Marathon on its way to a new resource

Marathon, Ont. — In the Port Coldwell mafic complex in north-central Ontario, exploration by Marathon PGM (MAR-V, MRPGF-O) is showing that the old-fashioned practice of banging on rocks can still be in style.

Marathon’s two years of exploration at its Marathon copper-palladium-platinum deposit has expanded an established resource while using geological insight and a willingness to follow up on old showings to outline new mineralization in an area that has already seen plenty of exploration.

Surface copper showings have been found northeast of the town of Marathon since the 1920s. The area saw its first systematic exploration in 1963, when Anaconda Copper — then one of the “Big Six” copper companies in the United States — drilled off a large, low-grade copper deposit in the Port Coldwell intrusive complex. “Large,” though, is very much in the eye of the beholder, and in a company that had beheld Butte and Chuquicamata, the Marathon deposit wasn’t compelling. Anaconda worked on the metallurgy until the early 1980s, but ultimately saw no future for Marathon; in 1985, it optioned the property to a Vancouver junior, Fleck Resources.

Fleck was one of the big junior stories of the mid-1980s, at a time when platinum prices were peaking at around US$600 per oz. Fleck’s plan was to re-assay Anaconda’s 36,000 metres of core for platinum group metals and establish a new economic picture for the deposit. Fleck drilled another 3,600 metres of its own, bulk-sampled the property and ran pilot tests.

In 1986, a feasibility study gave the project a low internal rate of return; later that year Fleck signed Teck, now Teck Cominco (TEK.SV.B-T, TCKBF-O), to an option agreement under which Teck had to provide a feasibility study. Teck’s early results were no different, and the company dropped its option. The next year, Australian-based Euralba Mining took up a similar option deal, but a prefeasibility study in 1989 — by which time platinum prices had cooled again — was negative.

Fleck shelved the project, which by then, had a resource estimate of 29 million tonnes grading 0.36% copper, 1 gram palladium and 0.26 gram platinum per tonne, and later changed its name to PolyMet Mining (POM-V, POMGF-O). The company is now is advancing the NorthMet copper deposit in Minnesota, another old Fleck project.

That set the stage for Geomaque Explorations to take up an option on the property in late 2000. Phillip Walford, now Marathon’s chief executive, led the project for Geomaque, and saw the deposit as a primary precious metals deposit with copper as a byproduct. Geomaque drilled another 3,200 metres and put together a measured and indicated resource of 21.3 million tonnes grading 0.4% copper, 1.3 grams palladium, 0.34 gram platinum and 0.12 gram gold per tonne, with a pit design that had a stripping ratio of 2.9:1. Geomaque also identified a series of drill targets well to the south of the known resource, mainly near-surface and around areas where Anaconda reconnaissance drilling in the 1960s and ’70s had picked up mineralized intersections.

But Geomaque’s Central American gold operations were caught in a cash crunch just as the gold price was hitting bottom; the Marathon project was a casualty. Geomaque was refinanced and became part of Defiance Mining before it was taken over by Rio Narcea Gold Mines (RNG-T, RNO-X).

PolyMet, its hands full with its Minnesota interests, sold the Marathon property to Marathon PGM for cash in 2004, a transaction that formed the basis for a public offering of Marathon shares. The new company raised just over $2 million and went to work, concentrating on those areas Geomaque had identified a couple of years earlier.

The technical success was almost immediate. In November 2004, drill holes into the BR Zone, about 700 metres southwest of the defined resource, and the Malachite Zone, 300 metres farther southwest, picked up significant widths of mineralization at grades comparable with the resource grade, all near the surface.

Drilling at the southern end of the resource extended its length by 75 metres, with some intersections cutting true widths of 20 to 45 metres.

The results of that first drill campaign translated into a new resource estimate, which showed 23.1 million tonnes grading 0.39% copper, 1.38 grams palladium, 0.34 gram platinum and 0.11 gram gold per tonne, all measured and indicated, and 8.4 million tonnes of inferred resources running 0.38% copper, 1.46 grams palladium, 0.38 gram platinum and 0.12 gram gold per tonne.

That was enough for Marathon to justify adding another 11 sq. km to the property, bringing its total size to 32 sq. km, and budgeting $1.5 million for exploration, including another 8,000 metres of drilling, in 2005.

Complex complexes

What is striking about the prospects is the extent of outcrop, which has made boot-and-pick prospecting the ultimate in exploration technology at Marathon. “Prospecting followed by trenching, and then drill,” Walford says. “That’s how we’re finding things.”

Intrusive complexes are called “complexes” for a reason: the multiple pulses of magma leave behind a mishmash of textural and compositional phases that — while they may be coherent over a broader scale — are often hard to map on a smaller scale without good exposure. Hence, trenching and stripping have played a big role in exploring the southern zones at Marathon.

It’s no knock on the old-timers, either, that prospecting works at Marathon. The overburden is thin enough that the bedrock is weathered, and while that helps distinguish different rock types, it hides the disseminated sulphide mineralization.

“When you cut it and see fresh rock, that’s when you know if you’re in the money or not,” Walford says.

Thanks to the shallow overburden and the need to expose unweathered rock, channel samples — located precisely using global positioning systems — have assumed more importance. “Because of the control, we can use these as horizontal drill holes,” says project manager Rick Middaugh.

The other side of the coin is that geophysics and geochemistry have shown only limited use. Walford says induced-polarization was “not as useful as we had hoped.” Mobile-metal-ion geochemistry “told us where the Main Zone was,” Middaugh says.

Magnetic mapping has been useful in showing how thick the gabbro is, but even the magnetite-rich gabbro doesn’t have a strong magnetic signature: it crystallized during a reverse-field magnetic epoch, and shows up as a magnetic low on the maps.

More broadly, the Port Coldwell gabbros can be divided into an earlier Eastern Gabbro with magnetite and olivine-rich layers, and a later gabbro, the Two Duck Gabbro, that intruded along structurally weak zones and which represents a later, volatile-rich magma body.

Academic research dating back to the Fleck days (done under David Watkinson at Carleton University in Ottawa) recognized that the Marathon mineralization wasn’t a purely magmatic creature. In the Two Duck gabbro, fluid phases allowed sulphide minerals to concentrate, and those sulphides are thought to have settled to the lower contact of the intrusive rock, where it meets the older andesites and felsites that are the country rocks of the whole intrusion. That makes the intrusive contact a primary target zone for the exploration program; Marathon geologists recognize a 4-km-long corridor of mineral occurrences and imagine it may extend another 3 km to Highway 17.

“The whole horizon is the one to chase,” Middaugh suggests.

Marathon’s efforts at chasing that horizon continued to bear fruit in 2005, as one hole drilled to the west of the Malachite Zone late in the summer intersected the highest grades of platinum group elements yet seen on the property. Another hole in the same area intersected a 52-metre core length grading 1 gram palladium and 0.4 gram platinum per tonne, plus 0.1 gram gold and 0.1% copper.

More drilling in the Southern Resource Zone int
ersected extensions to the known mineralization, often over true widths of 7 to 30 metres and showing palladium grades of 0.5 gram to about 2.5 grams.

Most recently, Marathon has gone back to the Main Zone, drilling infill holes to bring inferred resources into the indicated category. In general, the results have been a pleasant surprise, showing true widths in the 10- to 30-metre range and palladium and platinum grades above the resource grade. Hole M05-103, drilled beneath Two Duck Lake, intersected 22 metres grading 0.31% copper, 0.6 gram palladium, 0.16 gram platinum and 0.07 gram gold per tonne.

Marathon’s goal is to outline 30 million tonnes meeting a cutoff grade of 0.8 gram palladium per tonne, and take that resource to the feasibility stage. A bullish outlook for platinum and palladium would help, but “we don’t need a high palladium price for this to work,” says James Frank, Marathon’s chairman.

“It’s a polymetallic deposit,” says Walford. “You have to look at all the metals — they give us some strength.”

To see more pictures of James Whyte’s trip to Marathon, Ont., please visit www.northernminer.com/gallery