Ivanhoe tests Turquoise Hill

Ivanhoe Mines (IVN-T) has launched a 16,000-metre drilling campaign on the 238-sq.-km Turquoise Hill project in southern Mongolia.

The holes are aimed at testing the hypogene potential of the Southwest Oyu, Central Oyu and South Oyu zones, where Ivanhoe recently cut wide intercepts of high-grade copper and gold mineralization to depths of almost 500 metres below the surface.

Previous drilling tested the Southwest Oyu zone to a depth of 590 metres. Hole 150 averaged 1.17 grams gold and 0.81% copper per tonne over 508 metres (starting at 70 metres below surface). A 278-metre section (from 188 metres) ran in excess of 1% copper and 1.5 grams gold.

Some 1.2 km to the northeast, hole 159 recently tested the Central Oyu zone to a depth of 450 metres and cut a separate system with different mineralogy and geochemistry. The hole encountered 375 metres (from 47 metres) grading 0.69% copper, including 30 metres (from 47 metres) grading 1.5% copper and 0.22 gram gold per tonne.

The hole was a twin, and a deeper re-drill, of hole 94, which was a 130-metre-deep, reverse-circulation hole. The results extend economic copper grades to a depth of at least 422 metres below surface. The hole cut copper mineralization in chalcocite and covellite, which Ivanhoe notes is potentially amenable to the solvent extraction-electrowinning (SX-EW) process to produce cathode copper. This enhances the project’s economics.

Three rigs are drilling and two more are on their way as Ivanhoe hopes to delineate a high-grade resource at Southwest Oyu.

Based on a preliminary extrapolation of all drilling to date, Ivanhoe believes that the Turquoise Hill porphyry system has the potential to host more than 1 billion tonnes of copper, gold and molybdenum mineralization. The company says the Southwest Oyu zone alone may contain more than 500 million tonnes of copper and gold mineralization.

Ivanhoe has the conditional right to acquire the Turquoise Hill project by spending US$6 million on exploration and paying BHP-Billiton (BHP-N) US$5 million. The project contains four other known porphyry zones that cover an area measuring 3 km by 2 km.