Lac prospects offer reserve potential

Exploration work in 1992 indicates three projects have the potential for substantial impact upon company gold reserves, Lac Minerals (TSE) reports.

At the Red Mountain property in northern British Columbia, drilling more than doubled the preliminary gold resource to more than one million ounces, it says.

At Tambo in the El Indio complex in Chile, a new satellite deposit, Wendy Norte, has been discovered adjacent to the present Wendy open pit. Currently, ore reserves in the Tambo area exceed one million ounces.

And, at the Nevada property in Chile, geological re-interpretation has indicated the presence of a large epithermal gold system, Lac says. Initial drilling has confirmed the model, encountering substantial thicknesses and grades of gold mineralization, it says.

At the 100% owned Red Mountain property 10 miles east of Stewart, B.C., an 11-hole, 13,000-ft. drill program tested a new structural interpretation of the Marc zone, and its northwest extension, the AV zone.

The new preliminary reserve estimate is 2.8 million tons grading 0.37 oz. gold per ton. The new resource was calculated using a 0.088 oz. cutoff and a minimum thickness of 10 ft. Preliminary metallurgical test work indicates acceptable recoveries.

Plans for 1993 include 40,000 ft. of surface drilling to confirm and extend the Marc and AV zones and for follow-up drill testing of other targets on the property. Plans are also being formulated to begin an underground exploration program that would reach these zones to allow for a bulk sample and detailed reserve evaluation.

Work toward obtaining regulatory approvals and environmental permits relating to underground exploration and bulk sampling is under way.

The Tambo operation at the El Indio complex produces ores primarily from two open pits, Kimberly and Wendy. The potential for significantly increasing the reserves was recognized both around the existing pits and in the immediate vicinity, which would support larger-scale gold production, Lac says. As a result of the 1992 exploration program, the total ore reserves have increased by 280,000 oz. to about 1.16 million oz. in the proven, probable and possible categories.

Near the Wendy pit, a new deposit, Wendy Norte, was discovered and delineated in 1992. Initial resource calculations indicate about 120,000 oz. While the resource is not large, it is the first deposit found in the district which does not outcrop on surface.

A 60,000-ft. drilling program is under way to delineate mineralization around and below the present operations, and initial results are encouraging. Recent drill results have confirmed the potential for a large-tonnage, open-pit minable gold deposit in a large epithermal system at the Nevada project. A US$2.2 million exploration program, which includes 39,000 ft. of drilling, commenced last October on the 45,000-acre project about 30 miles north of the El Indio mine at an elevation of 15,000 ft. The property is owned by Compania Minera Nevada, of which Lac indirectly, through its Chilean subsidiary, owns 80%, with the balance being held by the original Chilean owners.

The current exploration program is a follow-up of a surface mapping and trenching program completed between January and March, 1992. Recent drill results from the first eight drill holes have extended the mineralized zone to the south from the previous drilling. These drill holes have tested an area of about 990×660 ft. Results received to date show grades ranging from 0.014 oz. over 42 ft. to 0.287 oz. over 89 ft.

The mineralized zone is open to the southwest and stepout drilling is focused in this direction. Previous surface work has discovered mineralization outcropping about one mile to the southwest at the same elevation.