Ivanhoe Australia posts initial resource on Merlin deposit

In the early 1900s high-grade, surface-enriched copper was mined from Mount Dore in northwestern Queensland but production to 1961 reached just 5.9 tonnes of copper.

Fast forward nearly fifty years and in December 2008, Ivanhoe Australia (IVA-A) completed an infill drilling program in the northern part of the Mt. Dore area that intersected significant molybdenum-rhenium mineralization. Ivanhoe called the new discovery the Merlin deposit.

Now Ivanhoe Australia, in which Ivanhoe Mines (IVN-T, IVN-N, IVN-Q) holds an 82.9% stake, has released its first National Instrument 43-101 resource estimate on Merlin based on 129 drill holes totaling 28,366 metres completed to June 30.

At a cut-off grade of 0.3% molybdenum, indicated resources are estimated to be 5.2 million tonnes at a grade of 1.0% molybdenum and 16 grams rhenium per tonne, for contained metal of 52,000 tonnes of molybdenum and 83 tonnes of rhenium. The inferred resource tallies 3.5 million tonnes at a grade of 0.8% molybdenum and 14 grams rhenium, for contained metal of 28,000 tonnes of molybdenum and 49 tonnes of rhenium.

Using a lower cut-off grade of 0.1% molybdenum, indicated resources would total 10 million tonnes at a grade of 0.6%molybdenum and 10 grams rhenium for contained metal of 58,000 tonnes of molybdenum and 97 tonnes of rhenium, plus additional inferred resources of 5.8 million tonnes at a grade of 0.5% molybdenum and 10 grams rhenium, for contained metal of 29,000 tonnes of molybdenum and 58 tonnes of rhenium.

Although Ivanhoe used other cut-off grades in its resource estimate calculation, the 0.3% and 0.1% molybdenum cut-off grades are the most relevant, it says.

A cut-off of 0.3% molybdenum, Ivanhoe explains, represents “a likely selective mining cut-off grade” and almost all of this material is captured within Merlin’s defined high-grade zone.

The 0.1% cut-off grade, represents material found inside a higher grade zone as well as in a medium-grade zone and it would make up a zone of continuity for less selective bulk mining.

At presstime,  Ivanhoe Australia was trading at A$3.75 per share.