Kilometre 88 a teaser for juniors

Several years ago, Venezuela’s Kilometre 88 district was the place to be for junior companies hoping to discover a premier gold deposit.

To date, however, new finds of the size and importance of Placer Dome’s Las Cristinas project have yet to be realized. But some progress is being made, and drilling programs have enabled several of the more lucky juniors to begin reporting a geological resource on their properties.

This summer, Vengold (TSE) announced results from drilling on its Oro Uno and Sor Teresita concessions in the Kilometre 88 district. The company drilled 69 holes totaling 11,000 metres on the two projects, including 43 holes on Oro Uno.

Eight of the Oro Uno holes were focused on the Tapaya pit, where a geologic resource equivalent to 6.2 million grams (200,000 oz.) gold equivalent was outlined. Typical of the results was a 73-metre intersection averaging 2.05 grams (gold equivalent) per tonne (1.15 grams gold and 0.64% copper). While the company viewed these results as encouraging, market watchers were not as impressed. Vengold had paid US$37.6 million for the Oro Uno concession, and results did not match the high expectations of Vengold’s shareholders, who bid down the company’s share price.

Exploration is continuing on the Oro Uno and Sor Teresita properties and is being focused on the mineralized zones identified to date. Work in the second half of this year will involve auger drilling, trenching and geological mapping, followed by a second phase of drilling in the fourth quarter. Sor Teresita is a joint venture with Carson Gold (VSE), which has several other concessions in the Kilometre 88 camp. Drilling began this summer on the Carson’s Reya concession, which was previously worked by local miners. Carson’s holdings total 23,200 hectares, 60% of which has been geochemically sampled to date. Under the Carson-Vengold joint venture, Vengold is required to pay for the acquisition, exploration and development costs through feasibility on the Bloque A, B and C, Sor Teresita and La Reya concessions. Not far away, on the Albino concession held by Crystallex International (VSE), a gold mill is starting up. The facility will process both surficial material and tailings from past mining activities and is expected to produce 186,620 grams (6,000 oz.) gold per month once fully operational. A legal dispute is continuing among certain companies seeking to establish ownership of the Brisas del Cuyuni concession in the Kilometre 88 region. Gold Reserve (TSE) and TVX Gold (TSE) are the two parties vying for the prospective concession.

Partners Canarc Resource (VSE) and Consolidated Magna Ventures (VSE) have reported results from a first phase of drilling on the Guarimba property in Kilometre 88. A 14-hole, 1,600-metre program was carried out between January and May of this year.

The drilling occurred on the northeastern corner of the property where extensive workings by illegal miners and a deep auger drill program by Magna indicated widespread surficial gold mineralization.

Most of the holes (12) intersected either low gold values or anomalous gold values over narrow widths that were not of economic interest. Better results were reported from Hole 94-6, which intersected a gold zone 29.4 metres wide grading 0.22 grams. The target occurs within a broad shear zone containing a stockwork of quartz-pyrite-calcite-chlorite veinlets crosscutting andesite tuffs. The company views this setting as favorable for large-tonnage, low-grade, open-pittable gold deposits.

Another hole, 94-7, returned a 6-metre-wide interval assaying 18.7 grams within the near-surface saprolite, or weathered bedrock. This gold zone is parallel to the first gold zone and the companies believe it may be related to the same bulk-tonnage gold prospect.

The two gold zones intersected by drilling are open along strike to the north and south, and Magna is planning a second phase of drilling.