Positive drill intercepts expand Turquoise Hill

Vancouver — Ivanhoe Mines’ (IVN-T) ongoing drilling campaign at the Turquoise Hill (Oyu Tolgoi) project in Mongolia has expanded gold-and-copper mineralization in the Central zone.

Drilling now indicates that the primary gold-copper porphyry mineralization appears to surround a core of secondary copper-rich covellite and chalcocite mineralization that lies beneath a near-surface, supergene-enriched chalcocite blanket.

“This discovery of a second zone of primary gold and copper porphyry mineralization at Central Zone is very good news and significantly enlarges the scale of the project,” said Douglas Kirwin, Ivanhoe’s executive vice-president. “Given the strength and extent of the induced polarization survey that stretches all the way to the Far North Oyu target, there is excellent exploration potential to expand this discovery."

Ivanhoe believes that the previously identified covellite-chalcocite mineralization at Central Oyu represents a separate mineralizing event that overprinted and replaced the primary chalcopyrite mineralization. The covellite-chalcocite mineralization may grade outward and at depth into more primary gold-bearing chalcopyrite mineralization.

To date, the primary chalcopyrite mineralization in the Central Oyu Zone has been intersected by ten wide-spaced holes over a distance of 1 km in an east-west direction and up to 800 metres in a north-south direction. Ivanhoe speculates that as drilling moves north, the Central zone may merge into the North Oyu geophysical target.

Highlights from the Central zone of primary mineralization include;

• Hole OTD187 cut 102 metres averaging 1.40 grams gold per tonne and 0.84% copper, starting 334 metres down-hole.
• Hole OTD196 encountered 156 metres grading 0.43 grams gold and 0.84% copper, starting 294 metres down-hole.
• Hole OTD202 intersected 136 metres grading 0.58 grams gold and 0.89% copper, starting 280 metres down-hole.
• Hole OTD211 cut 16 metres grading 0.49 grams gold and 0.69% copper followed by 28 metres grading 0.58 gram gold and 0.56% copper starting 470 metres down hole. These intercepts occurred after the hole had cut an initial 262 metres grading 0.08 gram gold and 0.89% copper in the overlying covellite-chalcocite mineralization.
• Along the north flank of the covellite-chalcocite zone, hole OTD226, collared 200 metres north of OTD211, cut 58 metres of chalcopyrite mineralization grading 0.42 gram gold and 1.90% copper, starting 264 metres down-hole. This was followed by an additional 58 meters grading 1.32 grams gold and 1.02% copper, starting at a down-hole depth of 532 metres.

Ivanhoe states that the two mineralized intervals in OTD226 indicate that primary chalcopyrite mineralization extends to the north flank, and may continue beneath the covellite-chalcocite zone. The gold-bearing chalcopyrite zone remains open laterally as well as to depth. Currently Ivanhoe is drilling step-out hole, OTD243, 200 metres north of hole 226, in order to test the down-dip extent and grade of these targets.

The Central zone is defined by a 1 km-by-500 metre induced polarization geophysical anomaly which lies north of the Southwest and South zones. To date, 16 holes have been drilled in the Central zone this year in an attempt to delineate copper and gold resources below the chalcocite-rich mineralization that was partially delineated by the company’s reverse-circulation drill program in 2000.

In the centre of the gold-bearing chalcopyrite mineralization in the Central Oyu zone lies a tabular zone of secondary covellite and hypogene chalcocite copper mineralization. This mineralization is known to be about 200 metres wide and 600 metres along strike with a vertical extent of 300-to-400 metres.

Significant drill intercepts in this zone include;

• Hole OTD211 cut 262 metres grading 0.89% copper and 0.08 grams gold, starting 64 metres down-hole. This included a 114 metre interval that averaged 1.33% copper and 0.11 gram gold.
• Hole OTD216 cut 268 metres averaging 0.70% copper and 0.07 gram gold, starting 142 metres down-hole.
• Hole OTD 217 intersected 124 metres grading 1.20% copper and 0.07 gram gold, starting 160 metres down-hole.

Scoping work is currently underway with the drilling of large-diameter metallurgical core holes for leaching and concentrate test work. Large-diametre drilling is planned to measure the quantity of ground water near the project site. To date, the company has completed about 50,000 metres of core drilling at the project.

Drilling in between the Central and Southwest Zones has identified strong chalcopyrite, covellite and chalcocite mineralization along the footwall of a large northeast-trending structure that extends northeast from the Southwest Discovery area. Highlights of drilling in this area includes;

• Hole OTD219 intersected 392 metres grading 0.77% copper and 0.04 gram gold, starting from 208 metres down-hole. This included 152 metres grading 1.06% copper and 0.04 gram gold.
• Hole OTD227, collared 120 metres to the southeast and up dip of OTD219, cut sediments overlying the mineralization.
• Hole OTD240, a scissor hole of 227, penetrated the sedimentary contact with the underlying mineralization in OTD219 at a down- hole depth of 284 metres and encountered moderate-to-strong bornite-chalcocite-covellite mineralization to the bottom of the hole at 539 metres.

At last report the Southwest zone alone hosts 13.8 million oz. gold and 6.9 billion lbs. copper within an estimated inferred resource of 821 million tonnes grading 0.52 gram gold and 0.38% copper. This is based on a cut-off grade of 0.30% copper equivalent.

The Southwest Zone hosts a higher-grade core zone of 120 million tonnes grading 1.55 grams gold and 0.70% copper. Four nearby, related, mineralized zones – Central, North, South and Far Southwest – were not included in the resource estimate. Ivanhoe plans to release an updated resource estimate, incorporating the latest drilling results, later this quarter.

Ivanhoe holds mineral rights to more than 51,600 sq. km in Mongolia, most of which is within the South Gobi porphyry belt. Exploration drilling is underway at the company’s gold and copper discovery porphyry at Kharmagtai, 120 km north of Turquoise Hill, and at a sediment-hosted gold prospect at OV3, approximately 15 km west of Kharmagtai.

Other high-priority targets within the belt that Ivanhoe plans to drill-test this year include Shuteen, Oyut Ulaan, Chandman Uul, Oyut Ovoo and Saran Uul. Additional drill rigs are being sourced from Australia and Canada.

By the end of the summer, Ivanhoe expects to have 18 drill rigs working on its Mongolian exploration program.