During the first phase, which consisted of 102 core holes (28,000 metres), Manhattan discovered a near-surface, flat-lying oxide gold resource of 1.3 million oz., plus a silver resource of 12.4 million oz. At the same time, the underlying TG-1 massive sulphide deposit was expanded and a potentially larger, albeit lower-grade, sulphide body was discovered at the TG-3 anomaly.
The oxide gold deposit represents a good portion of the prestripping required to mine the underlying sulphides, as well as substantial early cash flow.
MRDI Canada, a division of AGRA Simons, estimates the cap contains an inferred resource of 8 million tonnes grading 5.2 grams gold and 48 grams silver per tonne, based on a cutoff grade of 0.5 gram gold. High-grade values were cut to 25 grams gold and 300 grams silver. A preliminary pit design indicates a low stripping ratio of 1.2-to-1.
Preliminary metallurgical tests indicate recoveries in excess of 90% for gold and 75% for silver.
The oxide cap remains open to the north and presents an excellent opportunity for expansion in that direction. A hole previously drilled outside the limits of the sulphides, about 100 metres to the north, intercepted an oxidized 19-metre interval averaging 4.54 grams gold and 54 grams silver, starting at a depth of 20 metres.
Manhattan has proposed drilling 35 holes to chase the limits of the oxides to the north, the objective being to increase the current resource to more than 2 million oz. This proposal requires government approval as Manhattan would be drilling within the town limits of Tambo Grande.
The underlying TG-1 sulphide resource is within a 125-million-tonne pyrite-dominated body. Using a cutoff grade of 1% copper-equivalent, MRDI estimates an expanded inferred resource of 64.2 million tonnes averaging 1.7% copper and 1.4% zinc, plus 0.7 gram gold and 31 grams silver at a preliminary stripping ratio of 1-to-1. Metallurgical tests are being carried out on the sulphides at the labs of Lakefield Research in Ontario.
A resource calculation for the TG-3 polymetallic massive sulphide deposit is being prepared.
The second phase of drilling will consist of 50,000 metres. Initially, one drill rig will concentrate on the northern extension of the oxide gold cap, while two rigs attemtp to upgrade the TG-1 sulphides to the status of reserves. The drilling will likely be followed by a prefeasibility study in June 2000.
In addition, drilling will continue on TG-3 and other anomalies.
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