In a significant development, Australian-headquartered mining and exploration firm, Kingwest Resources Limited (ASX:KWR) has recently announced an updated MRE (Mineral Resource Estimate) for the Pericles Prospect at its Menzies Gold Project or MGP.
The Company has reported the new estimate as 0.78 [email protected] g/t Au (Inferred Resource) and 0.63 Mt @ 1.8 g/t Au (Indicated Resource) for a combined total of 1.4Mt at 1.8 g/t Au (79.5K ounces of gold). This indicates a significant increase of about 87 per cent in contained Au metal over its prior estimate reported in March 2016.
New Estimate Contains Higher Contained Au Metal
The new February 2020 estimate for Pericles (across the globe) contains considerably higher tonnages and contained gold ounces at lower grades than the previous February 2016 estimate.
In March 2016, Intermin Resources Limited reported Pericles Resource Estimate under JORC (2012), which was completed by CoxRock Pty Ltd utilising inverse distance cubed interpolation, with gold grades top-cut to 15 g/t Au.
No inferred resources were reported in the previous estimate, and all resources were classified as indicated.
Below table shows Pericles February 2016 Resource Estimate:
The difference between 2016 and 2020 estimate can be attributed to differences in classification, additional drilling and domaining and differences in bulk density values used.
The Company underlined that Pericles is not the only JORC resource in the MGP, while numerous other deposits have the potential for resource estimates to be calculated. The total near surface resources at Menzies now is 3.29 Mt at 2.0 g/t Au for 208,300 ounces.
Resources at Yunndaga, Bellenger and Warrior deposits bring the total to 208,300 oz @ 1.96 g/t Au (see figure below).
Pericles is the first of numerous deposits to be reviewed as potential near term open pit exploitable resources by Kingwest, and the Company is in the process of reviewing the existing and potential resources at MGP.
Moreover, the Company continues to focus on proving up high-grade deeper mineralisation at deposits, including Yunndaga and Lady Shenton, at which the existence of high-grade mineralisation at depth has been validated this month.
Latest MRE Relies on KWR’s 2019 Drilling
The Company notified that the new MRE has been reported and prepared in line with JORC Code (2012) and is based on the latest drilling conducted by Kingwest in 2019, along with remodelling and re-evaluation of the deposit.
A consultant to Kingwest Resources, Don Maclean completed the new geological interpretation and resource estimate. Moreover, the MRE depends on the geological assay data from 5 diamond core and 182 RC drill holes finalised up to December end 2019.
The Company added that the RC drilling was finalised by previous project operators, while it drilled five diamond holes, which were RC pre-collared and then diamond tailed using NQ core. The geological modelling utilised Leapfrog Geo 3D software, developing a 3D geological model, which was used to guide the mineralisation interpretations.
The Pericles resource block model was compiled using Leapfrog Edge resource modelling software, and grade estimation was done through ordinary kriging of one metre downhole composites.
The Company highlighted that gold was the only element estimated due to its economic significance as the primary metal. For preparing the resource estimate, it was assumed that mining and processing can be economically undertaken using conventional CIL/CIP processing and open pit mining methods.
As no metallurgical test work is available for Pericles, it is the geological continuation of the Lady Shenton open pit, located 200m to the south, which was successfully processed and mined in the late 1990s using conventional CIL/CIP.
Below table demonstrates February 2020 Resource Estimate, reported at an 0.5 g/t and 1.0 g/t Au cut-off grades which are expected mining cut-off grades reliant on the scale/style of open pit mining extraction.
Besides Pericles, the Company is in the process of updating other existing near surface Menzies resource estimates and assess new resource estimates for other near surface deposits.
Kingwest has planned to conduct economic studies and pit optimisation of Pericles in the first half of 2020 to gauge the potential for open pit mining. Its core focus is on drilling of and proving up high-quality gold mineralisation fit for potential underground mining.
KWR ended the day at $0.2 on the ASX, with a significant rise of 17.6 per cent on 14th February 2020).