New Pacific up 40% on HNK drilling

A new high-grade gold vein assaying well into the double-digits on New Pacific Metals‘ (NUX-V) HNK property in Guangdong province, China, pushed shares 40% higher today.

Hole ZK3001 intersected the new R1 vein, returning a 32.13-metre intersection grading 14.33 grams gold per tonne, including 8.13 metres grading 55.05 grams gold per tonne.

ZK3001 also intersected 30 cm of the V9 vein, grading 9.08 grams gold per tonne.

After the results were released, New Pacific shares jumped 80 to $2.80 apiece on a trading volume of 313,000 shares; the biggest trading volume the company has seen in months.

The R1 vein was intersected while the company was testing the limits of V9 vein. R1 is located about 120 metres to southeast of V9, which now has a strike length extending 1,500 metres and has been traced from surface to 280 metres at depth.

“We intersected V9 in three holes and as we go deeper the grades get higher,” says New Pacific director Lou Duarte.

Duarte says the company has a lot to learn about the R1 vein.

“We have no idea the orientation of the R1 zone, right now,” Duarte says. “We’re in the very early stages of trying to fully understand.”

The company has two drills in action at the project and will continue to further define the deposit where so far 19 holes have been drilled, totaling 5,523 metres.

On the V9 vein, drill hole ZK003 intersected a 1.94-metre intersection grading 46.06 grams gold per tonne extending to a depth of 280.2 metres.

ZK003, drilled on a different angle than the other two holes that hit V9, also cut through the R1 vein returning 4.43-metre intersection grading 99.91 grams gold per tonne as well.

V9 was intersected in hole ZK1001, which returned 3 metres grading 6.06 grams gold per tonne including 50 cm grading 32.5 grams gold per tonne while hole ZK1002 assayed 4.11 grams gold per tonne over 90 cm, reaching a depth of 298.49 metres.

New Pacific has already planned 10 more holes to follow up on the latest results and will also start an underground tunneling program of horizontal portals and decline shafts so it can access and explore the high grade R1 vein.

V9 mineralization occurs in a thick bedded sandstone and quartz sandstone of the upper part of the second section of Cambrian Shuishi formation. Mineralization is a grey coloured silicification associated with arsenopyrite, pyrite, sphalerite and pyrrhotite that is fine grained in the shapes of dots and veinlets.

R1 mineralization is located next to a small granodioritic stock but the extension and dipping direction is still unknown. New Pacific reports that the silicification associated with arsenopyrite and pyrite in R1 is much more intensive and wide.

New Pacific has found more than just V9 and R1.

“We’re finding many veins (in the area),” Duarte says. “The fact is, we have large-scale anomalies, we’ve done the drilling, we’ve traced what was on surface and now we’re drilling and finding that the source of these anomalies is a little bit deeper than on surface.”

Right now the focus is on the east side of the 56 sq. km property but New Pacific also has several targets that it will investigate later this year on the west side of the property, which has shown to have silver, lead and arsenic mineralization in addition to gold.

The company acquired HNK in 2006.

“What attracted us to this property was there were a lot of artisanal adits,” Duarte says.

He says the government stopped the artisanal operations in 2004 because they were using mercury to process the gold.

“We redid the soil geochem and found area was good for gold and other metals,” Duarte says.

New Pacific is 23.8%-owned by Silvercorp Metals (SVM-T, SVMFF-O), and is headed by the same president and CEO, Rui Feng.

New Pacific holds 100% of HNK and another property in Guangdong, called XSK, through an agreement with Silvercorp’s wholly-owned Chinese subsidiary, Yunnan Jin Chang Jiang Mining. The Chinese subsidiary holds the properties, totaling 160 sq. km, in trust for New Pacific.