Vancouver — A $9-million funding agreement sets the stage for
The 290-sq.-km project is in the Quesnel trough, a belt of favourable geology hosting numerous copper-gold mines and deposits in north-central British Columbia. Accessible by paved roads from Prince George, the project is 40 km from a hydroelectric power line.
Teck Cominco will provide $1.5 million under a convertible note to fund and direct this year’s exploration program, to be operated by Eastfield. After year one, the major can exercise an option to spend another $7.5 million by the end of 2010, at an annual rate of at least $1.5 million, in order to earn a 51% interest. This can be increased to 60% by completing a feasibility study, thereby giving each of the junior companies a 20% interest, and then to 65% by arranging or providing financing.
If Teck Cominco elects not to exercise the option after 2005, or subsequently relinquishes the option, then a previous option agreement allowing Eastfield to earn up to a 75% interest from Lysander will apply.
Lysander President Donald Mustard describes the agreement as “an excellent deal” for all parties. “This is a huge project that needs major-company participation.”
The Jayjay project has an exploration history dating back to the late 1940s. Initial drilling tested the Lorraine copper target, which occurs in a large intrusive complex called the Hogem Batholith. Previous operators, such as Kennecott, a unit of
Lysander had a similar goal in the mid-1990s when it acquired the project from Kennecott and outlined a resource at Lorraine. A copper-gold resource of 19.6 million tonnes averaging 0.68% copper and 0.18 gram gold per tonne was delineated in three zones; however, this estimate pre-dated National Instrument 43-101.
Lysander President Don Mustard says the project took on a new dimension in 1996 after geology professor Jay Hodgson examined the regional magnetics of Lysander’s initial properties and noticed a large ring structure about 10 km in diameter.
Satellite imagery and subsequent magnetic surveys applied to the topography confirmed the ring structure, which is bounded by the deep Pinchi fault to the west and by other major structural features. The centre of the ring occurs under an overburden-filled valley.
Lysander then expanded its holdings in the region to 250 sq. km to cover what is now called the “Jayjay ring,” as well as most of the Duckling Creek syenite complex, which intrudes the Hogem Batholith and is the most significant unit for copper, gold and occasionally platinum-group-metal mineralization.
The expanded property was dubbed “Jayjay” to reflect Hodgson’s contribution, as well as the contribution of Ja Hat Koo, who challenged the conventional view of the local geology in a 1964 thesis study. Koo proposed that the unique rocks observed at Lorraine “consist of metasomatic syenites or fenites formed by the metasomatism of the fractured Hogem diorite.” The unique and intensely metamorphosed rocks are believed to be the result of intense alteration around an alkali complex.
Based on the concept of a buried complex and the major annular magnetic structure, Lysander revised its exploration strategy to encompass geological models beyond the conventional copper-gold porphyries found in the region.
Mustard believes the Jayjay property is particularly prospective for iron-oxide copper-gold deposits associated with rift faulting, as found elsewhere in the world. “It’s a case I’m still trying to make, though not everyone agrees with me,” he says.
The recent change in emphasis at Jayjay has resulted in the discovery of new targets other than Lorraine, and these will be further explored in this year’s program. The targets include several areas of copper-gold-silver mineralization and some large geochemical anomalies.
Mustard says major-company participation is critical to the advancement of the Jayjay project. “It’s a big beast and it’s going to take time.”
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