N. Dynasty tags new zones at Pebble

Large alteration halos associated with copper-gold porphyry deposits often host a wide array of mineralizing styles, and the 89-sq.-km Pebble system in southwestern Alaska is no exception: a 5,300-metre program of scout drilling by Northern Dynasty Minerals (NDM-V) has cut three distinct types of potentially economic mineralization south of the historic deposit.

Situated 380 km southwest of Anchorage, the Pebble deposit was discovered by Cominco, now part of Teck Cominco (TEK-T), in the late 1980s. The major initially set its sights on the gold potential of the area, but a review of regional geochemical results indicated greater prospects for “copper porphyry”-style mineralization. By 1993, the company had drilled more than 100 holes, defining the inferred resource of 1 billion tonnes grading 0.3% copper and 0.34 gram gold per tonne, with a higher-grade core containing 54 million tonnes of 0.54% copper and 0.46 gram gold.

In 2000, the management team behind the Hunter-Dickinson (HD) group of companies recognized the prospects for additional discoveries within the large alteration system associated with the Pebble deposit and inked a deal with Cominco. The group then staked additional ground southwest of the original claims and ran a geophysical survey, which expanded the existing anomaly to a 21-by-9 km area. The accumulated data enabled company geologists to define six large coincidental geochemical and geophysical target areas over the 258-sq.-km project. Pebble marks the largest and northernmost anomaly. With the ground tied up and the targets in place, HD assigned the project to Northern Dynasty late in 2001.

Under the deal, the junior can purchase the 36 claims covering the Pebble deposit by paying Teck Cominco US$10 million in cash or stock by Nov. 30, 2003, and purchasing HD’s 20% interest in shares at its independently appraised value. Once the purchase is complete, the junior can earn a half-interest in the surrounding property by completing 18,290 metres of drilling before Nov. 30, 2004. A 2-year extension is available at a cost of 100,000 shares per year. At that time, Teck Cominco can elect to enter into a 50-50 joint venture or sell its remaining half- interest to Northern Dynasty for US$4 million and a 5% net profits interest.

With a deal in place, the HD-led junior sunk 41 widely spaced holes into the alteration system, and four of these returned significant mineralization.

The first new discovery lies 12 km southwest south of the Pebble deposit, where hole 34 cut 64 metres grading 0.3% copper and 0.2 gram gold per tonne at a down-hole depth of 21.3 metres. Moving 450 metres to the north, hole 38 hit 160 metres grading 0.32% copper and 0.33 gram gold at 35.4 metres down-hole.

“The program was designed to find a new porphyry deposit within the overall system, and we achieved that,” says Robert Dickinson, co-chairman of the HD group.

Lacking sills

The holes show classic copper-gold-molybdenum porphyry-style mineralization but lack the sills and dykes commonly observed in the Pebble deposit.

“It’s a totally different beast,” Dickinson says. “This is batholithic in proportions, and there is k-spar and quartz vein sheeting, which should lead to a high-grade core.”

The drill hole next-closest to the discovery is 1.9 km to the east, making the target prospective for a large tonnage find.

Moving 5 km west of hole 38, hole 37 tested a 1-km-long gold-copper soil geochemical anomaly and cut a broad zone of chalcopyrite-pyrrhotite skarn-style mineralization, yielding 0.4% copper and 1 gram gold over 79 metres at 14.9 metres down-hole. Included in this section was a higher-grade portion running 1.7% copper and 3.6 grams gold over 6.5 metres.

“The skarn could be tied to the outboard of the new discovery,” adds Dickinson, “but clearly it is part of the same mineralizing system.”

Some 5 km south of the Pebble deposit, hole 25 tested an 800-by-800 metre gold-in-soil anomaly and returned an impressive 28.9 grams gold over 6.1 metres. The mineralization is hosted in a biotitic pyroxenite and lies 350 metres southwest of a previous Cominco hole, which returned 33.9 grams gold over 1.5 metres. The junior does not yet have a handle on the control or extent of the gold mineralization.

“It is not a vein, but it could be lithologically controlled,” says Dickinson. “At this point, we need to go back to the core racks and look at the two holes.”

All three styles of mineralization occur within a 22-by-6-km multi-phase intrusive corridor at the southeastern edge of the Kaskanak batholith and are associated with a late Cretaceous intrusive complex.

“There are lots of different intrusive phases,” says Dickinson, “from mafic pyroxenites through to rhyo-dacites.”

Based on the promising results, the junior aims to begin delineation drilling over the new discoveries early next month. Using two rigs, grid-style drilling will be completed over the copper-gold-molybdenum find, together with stepout drilling along the east-west geochemical anomaly covering the skarn zone. Field evaluations will be carried out over the high-grade gold area in order to develop a drill plan to delineate the extent of this zone.

Northern Dynasty has $1.2 million in working capital and 13.2 million outstanding shares.