More Alaskan high grade for NovaCopper

Since NovaCopper (NCQ-T, NCQ-X) started drilling the South Reef zone on its Bornite concession in northwestern Alaska this year, 16 of the 19 holes returned high-grade copper — a success rate of 84%. 

The mineralization is consistent over a northeast-trending zone 300-by-700 metres along strike and it remains open to the north, east and southwest, says the junior explorer, which was spun out of ­NovaGold Resources (NG-T, NG-N) earlier this year. 

The Bornite concession is one of three volcanogenic-massive-sulphide (VMS) deposits that make up the Upper Kobuk project, about 322 km west of Teck Resources’ (TCK-T, TCK-N) Red Dog zinc-lead mine. The other two concessions are called Arctic and Sunshine. The latter, a ­satellite polymetallic VMS deposit, is 12 km west of the Arctic deposit.

In July NovaCopper published a resource estimate for its near-surface Ruby Creek zone, just west of the South Reef zone, on the Bornite concession. Ruby Creek contains 6.8 million tonnes grading 1.2% copper for 179 million contained lb. copper in the indicated category, and 47.7 million inferred tonnes averaging 0.84% copper at a 0.5% copper cut-off, for 883.2 million contained lb. copper.

At South Reef, NovaCopper drilled 22 holes, or 15,500 metres, during its 2012 drill program. The most recent batch of assay results were released on Nov. 1, and three of the four drill holes intersected high-grade mineralization. The fourth hole, drilled 500 metres to the east of the South Reef zone, did not hit significant mineralization.

Hole 12-211 intersected four mineralized intervals for a combined 44.2-metre composite interval with a weighted-average grade of 6.06% copper. The hole consisted of 8.2 metres grading 7.91% copper, 5.3 metres of 4.08% copper, 17.5 metres of 5.10% copper and 31.2 metres of 6.96% copper.

Hole 12-212 intersected two mineralized intervals for a combined 16.8-metre composite interval with a 4.31% average copper grade. It was made up of 8.7 metres grading 4.95% copper and 8.2 metres grading 3.64% copper.

Finally, hole 12-213 hit one mineralized interval of 3.6 metres at 3.97% copper. The most recent assay results released on Nov. 1 include 8.2 metres carrying 7.91% copper. All of the results used a 0.5% copper cut-off grade.

NovaCopper hopes to complete a revised resource estimate for the Bornite property that will include the Ruby Creek and South Reef zone in the first quarter of next year.

Earlier this year, NovaCopper filed a preliminary economic assessment of its Arctic deposit, also part of the company’s Upper Kobuk project in Alaska’s Ambler mining district. The PEA envisions an underground mine with annual production of 67 million lb. copper and 80 million lb. zinc, including precious-metal credits. The 4,000-tonne-per-day operation would cost US$262 million to develop and have an after-tax net present value between US$500 million and US$1 billion, depending on metal-price assumptions.

For the nine-month period ended Aug. 31, the company reported a net loss of $23.2 million compared to a net loss of $9.7 million in the same period in 2011. The higher losses were primarily due to increased activities at the Upper Kobuk project during the 2012 field season, as well as general administrative expenses.

In Toronto NovaCopper was trading at $2.54 within a 52-week range of $1.62 to $5.16. The company has 47 million shares outstanding.