Placer Dome to buy Kerr copper-gold deposit

Earlier this year, Western Canadian Mining retained Wood Gundy to find a buyer for its interest in Sulphurets and in the Kerr deposit. A total of 26 companies are reported to have expressed interest in the offer.

Although subject to the usual conditions and regulatory approvals, Placer Dome will acquire its interest by buying 7.64 million shares of Sulphurets for 95 cents per share payable in cash, for a total value of $7.26 million. Also, Placer Dome is expected to make a follow-up offer to minority shareholders of Sulphurets.

William Thompson, Placer Dome’s manager of corporate communications, said the project will be actively worked in the 1990 season.

“It is still an early stage project, but it’s one with considerable promise that warrants additional exploration,” he said.

The Kerr deposit is in a rugged and remote area which cannot be reached by road and does not have power supply. But the British Columbia government is expected to make a decision this fall on a proposed access route into the nearby Iskut River region. If realized, that would have positive benefits for the development of the Kerr deposit.

Meanwhile, Sulphurets intends to continue its current exploration program on the Kerr property and on the adjacent Tedray property where it is earning a 50% interest from Newhawk Gold Mines and Granduc Mines.

The focus of the current program is to expand the geologic reserve of 66 million tons averaging 0.86% copper and 0.01 oz gold that was outlined (based on 12 holes) at the end of the 1988 program. The deposit dips to the west and appears to be mineable by open pit methods at a strip ratio estimated to be less than 2:1.

This season the company has drilled a total of 17 holes to test the deposit along a strike length of 5,200 ft, with the zone still open to the north, south and at depth. Down dip drill intersections have so far indicated a width of 800 to 1,000 ft.

The emphasis lately has been to expand the deposit to the north where the strip ratio appears to be more favorable. This drilling has so far extended the deposit some 500 ft onto the Tedray property.

Robert Hewton, vice-president of Sulphurets, said these holes are confirming the continuation of the mineralized zone identified by the low resistivity, high chargeability anomaly outlined in a recently completed geophysical survey.

The anomaly follows the same alteration underlying the known deposit and is believed to have good potential for reserve expansion.

Results from recent drilling include: 175 ft grading 0.79% copper and 0.008 oz gold; 243 ft of 0.62% copper and 0.009 oz gold; 777 ft of 0.38% copper and 0.006 oz gold; 196 ft of 0.90% copper and 0.01 oz gold; 682 ft of 0.58% copper and 0.008 oz gold, including 310 ft of 0.86% copper and 0.010 oz gold.

More recent results are: 253 ft of 0.80% copper and 0.006 oz gold; 728 ft of 0.47% copper and 0.006 oz gold; 549 ft of 0.54% copper and 0.01 oz gold and 413 ft of 0.43% copper and 0.005 oz gold.

The company also intends to drill test the width of the deposit which is contained within the large alteration zone.

Hewton said the company’s work to date has shown the deposit to have good continuity, though the nature and variety of minerals found on the property often make it difficult to predict grade from visual examination of drill core.

Copper mineralization consists of chalcopyrite, tennantite, bornite, primary chalcocite, some secondary chalcocite and traces of native copper occurring as fine disseminations or in veinlets. The host unit is a quartz sericite schist that is well foliated and broken by faulting.

The Kerr and adjacent Tedray property also contain a number of precious metal exploration targets.

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