Sunridge adds deposit to Asmara

Controlling a district rich with volcanic massive sulphides (VMS) has its advantages.

Sunridge Gold (SGC-V) proved the point with the release of a resource estimate for yet another deposit at its Asmara project in Eritrea. For those that are counting, that brings the company’s tally up to five deposits with a compliant resource estimate within Asmara’s property boundaries.

Sunridge has been proving up the project since 2003, having drilled over 200,000 metres over that time and outlining proven and probable reserves of 57.3 million tonnes grading 0.72% copper — enough to produce 804 million lbs of copper, 1.79 million lbs of zinc, 415,000 oz. of gold and 11 million oz. of silver by the company’s estimates.

The four deposits that already have resource estimates are Emba Derho, Gupo Gold, Adi Nefas, and Debarwa.

A pre-feasibility study that considered production from those four deposits generated a base case net present value of $555 million using a 10% discount rate and an internal rate of return of 27%.

The latest addition to its suite of deposits is known as Adi Rassi. While at this stage it is less impressive in terms of size and grade — with inferred resources of 15.8 million tonnes grading 0.54% copper, 0.33 grams gold, and 1.5 grams silver — it will still likely serve as an asset that can bring feed to a future mill.

Of the outlined inferred resources Sunridge says 14.9 million tonnes, with an average grade of 0.54% copper and 0.30 grams gold, falls within its conceptual optimized open pit shell.

Then there is a small, higher-grade portion of the deposit of 800,000 tonnes grading 0.67% copper and 0.89 grams gold that would be mined via underground methods.

The estimate was based on 26 diamond drill holes that traced the deposit over a 450 metre strike length. The deposit remains open to the north, south and at depth, with the current resource going down to a depth of 360 metres.

Unlike Sunridge’s neighboring Emba Derho, Adi Nefas, and Debarwa deposits, Adi Rassi is associated with a steeply dipping shear zone that measures over 3 km long and 40 metres wide.

Debarwa, the most southerly of the other four deposits, sits 10-km northwest of Adi Rassi.

“Adi Rassi has the potential to provide supplemental mill fee and/or extend the Asmara project’s life past the 15 year mine life detailed in a May 2012 prefeasibility study” wrote Haywood Securities analyst Stefan Ioannou in a research note.

Sunridge recently completed a $10.8 million equity financing that it says will allow it to complete a feasibility study on Asmara, while continuing with exploration drilling through early part of next year. It plans to have the feasibility study done by next April.

In Toronto on Dec. 4, the company’s shares were off a half a penny to 19¢ on 42,500 shares traded. Over the last 52-week period the company’s shares have fluctuated between 19¢ and 52¢.