Low grade deposit on Springpole bet

The Portage zone on the Springpole gold property being explored by joint venture partners Noranda (TSE) and Akiko-Lori Gold Resources (VSE) hosts geological reserves of at least 7.9 million tons grading 0.07 oz. gold per ton. That figure was reported in the 1989 annual report of Hemlo Gold Mines (TSE) which is funding Noranda’s share of exploration expenditures at Springpole.

Situated 70 miles east of Red Lake, Ont., the property has been the site of a 20,000-ft. winter drilling program, expected to reach completion early next month.

The partners have an option to earn a 70% interest in the claims from Gold Fields Canadian Mining, and a $400,000 cash payment is due to the latter company on March 31.

In the past, when faced with large cash payments on marginal exploration properties, Noranda has been known to drop its option if the project does not meet specific economic criteria.

Last year, for instance, Noranda halted underground exploration on the Tundra gold project in the Northwest Territories when disappointingly low-grade gold values were encountered.

The Portage gold deposit lies almost entirely under the waters of Springpole Lake which could prove to be an obstacle in any future development. The companies have been assessing the open pit potential of the Portage zone as well as attempting to outline a high-grade core which might be suitable for underground mining.

Although Noranda’s recent work has focused on the bulk tonnage potential of the Portage zone, four other significant gold zones are also known to exist on the 7,700-acre property.

The gold deposit occurs within the major Springpole Lake structural horizon which is bounded by a porphyritic volcanic complex. The geological setting is characterized by intensely fractured rocks and deep overburden.