Condor Gold {AIM: CNR} announced more results from their continued drilling on the Mestiza Vein Set at the La India Project, Leon Province, Nicaragua.
The objective is to convert an historic Soviet mineral resource (2,392 kt at 10.2 g/t gold for 785,694 oz gold) to a Canadian NI 43-101 standard.
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Condor Gold Announces Drill Results on La India Project: Including 3.6 m at 23.3 g/t Gold and 3.1 m at 14.4 g/t Gold
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LONDON, June 29, 2017
Condor Gold {AIM: CNR} is pleased to announce more results from continued drilling on the Mestiza Vein Set at the La India Project, Leon Province, Nicaragua. The objective is to convert an historic Soviet mineral resource (2,392 kt at 10.2 g/t gold for 785,694 oz gold) to a Canadian NI 43-101 standard.
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The initial focus is on the Tatiana Vein, one of the 4 constituent veins and the largest portion of the resource. Results are excellent and have identified a high grade ore shoot in the area of a major dilational bend. The programme continues with two drill rigs and has now been expanded to 6,000 m in total.
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Highlights:
LIDC348 drill width 3.6 m (true width 2.3 m) at 23.3 g/t gold and 66.6 g/t silver from 160.5 m depth.
LIDC348 is 100 m vertically down dip of a previously reported drill hole (LIDC344; drill width 3.3 m at 28.3 g/t gold) and demonstrates a high grade ore shoot which extends to at least 150 m below surface and may have a strike extent of about 300 m.
LIDC360 drill width 3.1 m (true width 2.7 m) at 14.4 g/t gold and 29.2 g/t silver from 40.3 m depth.
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The 3,000 m drilling programme is now expanded to 6,000 m.
The Tatiana vein has excellent continuity for 1.5 km and is a 4-5 m wide mineralised structure. The average true width of the high grade portion, comprising mostly fault breccia, is approximately 2.5 m.
High recoveries have been achieved in the mineralised zone, including mineralised fault breccias that previous drilling failed to recover.
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Mark Child, Chairman and CEO comments “The drill result of 3.6 m at 23.3 g/t gold on the Tatiana vein is very encouraging because it is approximately 100 m below our previously reported drill intercept of 3.3 m at 28.3 g/t gold. This and neighbouring drill holes define a high grade shoot which is open down dip and along strike for approximately 300 m. In light of this, the drill programme has been modified from broadly 100 m centres, to include drilling some 50 m step out holes in this high grade zone.
The overall objective is to convert an historic Soviet-style mineral resource (2,392 kt at 10.2 g/t gold for 785,694 oz gold) to Canadian NI 43-101 standard. This will hopefully boost the current NI 43-101-compliant Inferred Mineral Resource at Mestiza (1,490 kt at 7.47 g/t for 333,000 oz gold)”.
Mestiza is excluded from the current mine plans in the PFS and PEAs. A successful resource conversion has the potential to add large, high grade, and relatively shallow resources to a future mine plan, thereby increasing the annual gold production, life of mine, and project economics. The Tatiana vein has excellent continuity for more than 1.5 km and we hope to identify further high grade shoots by targeting bends in the vein, which are more dilational and seem to have controlled gold grade.”
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Background
La India Project’s existing NI 43-101-compliant mineral resource is 18 Mt at 4.0 g/t Au (2.31 Moz gold). This consists of seven separate resources, most of them open along strike and at depth. It includes Mestiza, which hosts a NI 43-101-compliant Inferred mineral resource of 1,490 kt at 7.47 g/t (333,000 oz gold). Here, Soviet-backed drilling in 1991 estimated a Soviet-style mineral resource of 2,392 kt at 10.2 g/t gold (785,694 oz gold) (See RNS dated 22nd May 2017). The bulk of the resources are contained within the Tatiana vein, the largest of the four main veins on Mestiza.
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Current Drill Plan
Condor commenced drilling with one drill rig on Mestiza on 23rd March 2017, to test the Soviet drill intercepts and convert the high grade Soviet-style mineral resource estimate to Canadian NI-43-101 standard (See RNS dated 31st March 2017). The initial batch of drill holes assays was reported on 22 May 2017. It is expected that further drilling of about 3,000 m (total of 6,000 m drilling) will be required to convert the majority of the Soviet mineral resource to a NI 43-101-compliant Inferred Mineral Resource.
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Discussion of Drill Results
As reported in the last drill hole results released on 22 May 2017, mineralisation occurs within a 4-6 m wide mineralised structure crosscutting a major unit of welded tuff with conspicuous fiamme. The structure consists of:
A central high grade quartz vein, 0.5-1.0 m wide, with comb and drusy quartz and minor chalcedony. Textures of the vein vary between holes, from massive silica, to leaching textures with skeletons of former calcite, to locally colloform banded pale green chalcedony with fine streaks of sulphide mineralisation.
2.5 m of jigsaw and crackle hydrothermal breccia around the central vein. Drusy and comb quartz forms the matrix of these breccias, normally associated with lower gold grades.
Late fault breccias along the structure containing clasts of vein and hydrothermal breccia, which can contain significant high grade gold mineralisation.
Gold mineralisation is associated with the quartz vein and fault breccia over true widths of up to 3 m. The nature of the fault breccia, with variable amounts of gold mineralised vein clasts in a “difficult to recover” clay gouge, leads to high grade variability across the deposit. There is also a supergene effect as suggested by high grade silver spikes in some of the deeper historic holes (e.g., 0.7 m @ 356 g/t Ag from 198.1 m in LIDC030B).
A long section of the Tatiana Vein (Figure 3) plots the drill hole intercepts at the point at which they pierce the vein for all the historic and current drilling. Each point is described by a grade thickness factor, which is the downhole intercept length multiplied by the average grade. At the local scale this shows the highly variable nature of mineralisation, but at the larger scale shows that the vein is broadly well mineralised and forms high grade shoots separated by intervening areas of low grade where the mineralised zone is thinner.
A geological model has been developed which correlates high grade gold mineralisation with bends in the vein (see ‘Big Bend’ in Figure 1). These bends created more open space, allowing more hydrothermal fluid circulation, resulting in higher grade. The Big Bend high grade shoot, which appears to pitch almost vertically, extends over a strike length of approximately 300 m. It is open to depth and the deepest intersections, about 150 m below surface, remain in oxidised material. Deeper drilling, and drilling to infill untested ‘gaps’ in Big Bend, are underway with more closely spaced drilling, on 50 m centres, to better define the geometry and extent of the high grade shoot.
Drilling will continue on 100 m centres along the strike length of the Tatiana, Buenos Aires and Jicaro veins for resource definition purposes and to help identify new shoots.
Figure 3 Long Section of Tatiana Indicating a High Grade Ore Shoot
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Mestiza in the context of La India
Mestiza is significant for five reasons:
1. It already hosts a NI 43-101-compliant mineral resource (1,490 kt at 7.47 g/t; 333,000 oz gold). This is excluded from the current Pre-Feasibility Study (‘PFS’) and Preliminary Economic Assessment (‘PEA’) at La India Project.
2. The December 2014 PEA contains an open pit and underground mining scenario using a 1.6 Mtpa processing plant recovering 1,203 koz gold over the life of mine, with the first 5 years production averaging 138,000 oz gold pa.
3. The January 2016 Whittle Enterprise Optimisation to NPV of the above PEA materially increased the recovered gold and project economics. Using the same 1.6 Mtpa processing plant, recovered gold increases to 1,437 koz gold over the life of mine with the first five years of production averaging 165,000 oz gold pa.
4. All production scenarios to date exclude Mestiza, which is in close proximity to the La India and America vein sets (See Figure 4). There is a high possibility of bringing additional high grade gold from Mestiza into a future mine plan, feeding a centralised processing plant.
5. Importantly, Mestiza hosts a relatively shallow high grade, oxidised resource, which is currently viewed as a combined open pit-underground mining target. The average drill depth is 112 m for the 6,000 m resource conversion drilling programme. The existing resource is open along strike in both directions and at depth. The shallow, high grade nature of the resource suggests it could be added early on to the mine plan, enhancing the production profile and economics of the project.
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Competent Person’s Declaration
The information in this announcement that relates to the mineral potential, geology, exploration results and database is based on information compiled, and reviewed, by Mr Peter Flindell, Member of the Australian Institute of Geoscientists, Member of the Australasian Institute of Mining and Metallurgy and Member of the Society of Economic Geologists. Mr Flindell is a geologist with over thirty years of experience in the exploration of precious metal mineral resources. Mr Flindell is a non-executive director on the Board of Condor Gold plc who also provides technical leadership to the technical team in Nicaragua and has considerable experience in epithermal mineralisation, the type of deposit under consideration, and sufficient experience in the type of activity that he is undertaking to qualify as a ‘Competent Person’ as defined in the June 2009 Edition of the AIM Note for Mining and Oil & Gas Companies. Mr Flindell consents to the inclusion in the announcement of the matters based on their information in the form and context in which it appears and confirms that this information is accurate and not false or misleading.
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Technical Glossary
Assay The laboratory test conducted to determine the proportion of a mineral within a rock or other material. Usually reported as parts per million which is equivalent to grams of the mineral (i.e. gold) per tonne of rock Ag Silver Au Gold breccias A fragmental rock, composed of rounded to angular broken rock fragments held together by a mineral cement or in a fine-grained matrix. They can be formed by igneous, tectonic, sedimentary or hydrothermal processes. C1 C1 reserves are broadly equivalent to JORC indicated resources and have been estimated by a sparse grid of trenches, drill holes or underground workings. The quality and properties of the deposit are known tentatively by analyses and by analogy with known deposits of the same type. The general conditions for exploitation are partially known C2 C2 reserves are broadly equivalent to JORC inferred resources and have been extrapolated from limited data, probably only a single hole Chalcedony A variety of quartz formed by microscopic or submicroscopic crystals. In an epithermal environment, chalcedony is formed in low temperature and pressure conditions high in the system. Colloform banded A texture found in fine grained quartz (chalcedony) veins where crystals have grown in a radiating and concentric manner form a vein centreline to give a finely banded appearance Comb quartz A quartz vein texture describing masses of parallel long, thin crystals growing inwards from the vein margins produce a texture like that of a comb. Drusy quartz A coating of fine quartz crystals [https://en.wikipedia.org/wiki/Crystal] on a rock fracture surface, which may be an open space in the vein. Fiamme Fragments of volcanic [https://en.wikipedia.org/wiki/Volcano] ejecta, often pumice, that have been flattened by compaction to form flame-like shapes Geochemistry The study of the elements and their interaction as minerals to makeup rocks and soils Geophysics The measurement and interpretation of the earth’s physical parameters using non-invasive methods such as measuring the gravity, magnetic susceptibility, electrical conductivity, seismic response and natural radioactive emissions. Hydrothermal Hot water circulation often caused by heating of groundwater by near surface magmas and often occurring in association with volcanic activity. Hydrothermal waters can contain significant concentrations of dissolved minerals. Kt Thousand tonnes Mineral Reserve The economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined. Appropriate assessments and studies have been carried out, and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction could reasonably be justified. Ore Reserves are sub-divided in order of increasing confidence into Probable Ore Reserves and Proved Ore Reserves. Mineral Resource A concentration or occurrence of material of economic interest in or on the Earth’s crust in such a form, quality, and quantity that there are reasonable and realistic prospects for eventual economic extraction. The location, quantity, grade, continuity and other geological characteristics of a Mineral Resource are known, estimated from specific geological knowledge, or interpreted from a well constrained and portrayed geological model. NI 43-101 Canadian National Instrument 43-101 a common standard for reporting of identified mineral resources and ore reserves Phreatic breccias Fragmental rocks formed near the Earth’s surface by the interaction of hot rock and cold water, or vice versa. Commonly occur at the top of mineralized epithermal gold systems. Rock chip A sample of rock collected for analysis, from one or several close spaced sample points at a location. Unless otherwise stated, this type of sample is not representative of the variation in grade across the width of an ore or mineralised body and the assay results cannot be used in a Mineral Resource Estimation Soviet The former Soviet system for classification of reserves and Classification resources, developed in 1960 and revised in 1981, which divides mineral concentrations into seven categories of three major groups, based on the level of exploration performed: explored reserves (A, B, C1), evaluated reserves (C2) and prognostic resources (P1, P2, P3) Soviet GKZ The former Soviet State Commission for Mineral Reserves. Stockwork Multiple connected veins with more than one orientation, typically consisting of millimetre to centimetre thick fracture-fill veins and veinlets. Strike length The longest horizontal dimension of an ore body or zone of mineralisation. Vein A sheet-like body of crystallised minerals within a rock, generally forming in a discontinuity or crack between two rock masses. Economic concentrations of gold are often contained within vein minerals. Welded tuff A fragmental volcanic rock formed by sufficiently hot volcanic ejecta that the fragments weld together Zeolite veinlets Zeolites are hydrated aluminosilicates found in gas bubbles within basalts and in geothermal districts. They also found in the upper parts of gold-bearing epithermal systems.
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About Condor Gold plc:
Condor Gold plc was admitted to AIM on 31st May 2006. The Company is a gold exploration and development company with a focus on Central America.
Condor completed a Pre-Feasibility Study (PFS) and two Preliminary Economic Assessments (PEA) on its wholly owned La India Project in Nicaragua in December 2014. The PFS details an open pit gold mineral reserve of 6.9 Mt at 3.0 g/t gold for 675,000 oz gold producing 80,000 oz gold p.a. for 7 years. The PEA for the open pit only scenario details 100,000 oz gold production p.a. for 8 years whereas the PEA for a combination of open pit and underground details 140,000 oz gold production p.a. for 8 years. La India Project contains a total attributable mineral resource of 18.08 Mt at 4.0 g/t for 2.31 M oz gold and 2.68 M oz silver at 6.2 g/t to the CIM Code.
In El Salvador, Condor has an attributable 1,004,000 oz gold equivalent at 2.6 g/t JORC compliant resource. The resource calculations are compiled by independent geologists SRK Consulting (UK) Limited for Nicaragua and Ravensgate and Geosure for El Salvador.
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Disclaimer
Neither the contents of the Company’s website nor the contents of any website accessible from hyperlinks on the Company’s website (or any other website) is incorporated into, or forms part of, this announcement.
For further information please visit http://www.condorgold.com or contact:
Condor Gold plc
7th Floor 39 St. James’s Street London SW1A 1JD
Telephone +44-0207 493 2794
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Condor Gold plc
Mark Child, Executive
Chairman and CEO
