New Pacific finds high-grade, narrow-vein gold

New Pacific Metals (NUX-V) has intersected high-grade gold in channel samples from a narrow vein on its 57 sq. km HNK project in Guangdong province, China.

The exploration program has entailed 1,300 metres of horizontal tunneling in four levels at depths of 260 metres, 220 metres, 195 metres and 180 metres. The tunneling is designed to follow the main mineralized vein, V9, which has been traced to a depth of 400 metres.

The latest discovery has cut mineralization with much higher gold grades than previous intercepts. It was found in a 28-metre-long drift cut along the V9 vein at the 180-metre-level tunnel. The average grade in channel samples taken over the 28-metre drift is 295 grams gold per tonne, 124 grams silver, 1.33% lead and 1.93% zinc, and the average true width is 0.37 metre.

The best intercept was in channel sample 170, which cut 0.5 metre (true width) of 621 grams gold, 181 grams silver, 2% lead and 3.8% zinc. Samples 177, 173 and 174 returned much lower grades, with gold between 2.2 and 5.7 grams, and widths between 0.3-0.35 metres. Samples 176, 175, 168, 171 and 172 returned 230-450 grams gold in 0.3-0.5 metre-wide intercepts.

To date, the company completed 51 drill holes totaling 15,000 metres. New Pacific is planning to complete another 2,000 metres of tunneling, drifting, cross-cuts and raises on the V9 vein to a depth of 300 metres in 40-metre depth intervals, and on the R1 vein on the 195-metre-deep tunnel.

The company would like to produce a resource or reserve estimate and to mine sufficient material for a bulk sample for a metallurgical test. The findings would be used to prepare a technical report and apply for a mining permit. Preliminary metallurgical testing using crushing and flotation have returned recoveries above 90% for gold, silver, zinc and lead.

New Pacific is 24%-owned by Silvercorp Metals (SVM-T, SVM-X), China’s largest silver miner. As the owner of the Ying silver mine, Silvercorp is no stranger to narrow-vein, high-grade mining.

On the news, New Pacific shares rose 19¢ to 80¢, with 27,000 shares changing hands. The company has 31.7 million shares outstanding, or 38.3 million shares fully diluted. The shares have been trading in a 30¢-$3.12 range over the past 12 months. On December 31, New Pacific had working capital of $11.8 million.