Stewart R. Wallace — 1919–2009 - Society of Economic Geologists

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EXPLORATION REVIEWS 44 SEG NEWSLETTER No 78 JULY 2009 ... from 43 Exploration Reviews (Continued) Mystery project in the Cape Smith nickel belt in the far north. Highlights from 8,162 m drilled in 2008 include up to 131 m at 0.8% Ni, 0.9% Cu and 3 g/t PGE, and 76.3 m of 0.9% Ni, 1.1% Cu and 2.9 g/t PGE. In diamond exploration, Stornoway Diamonds and joint-venture partner SOQUEM have received a positive economic assessment for the Renard diamond project on the Foxtrot property north of the Otish mountains area in central Quebec. Indicated and inferred resources now stand at 11.5M carats at 61.1 carats/100t. EUROPE Regional Correspondent: Paul W. Kuhn (SEG 1983) Metallica Mining AS Oslo, Norway E-mail (temporary): paulk@wegamining.com Contributing Correspondents: Evgeny Pluschev – Bulgaria Ozcan Yigit (SEG 2002 F) – Turkey Christina Lundmark (SEG 2006) – Sweden Pasi Eilu (SEG 2002) – Finland Peter Kodera (SEG 2002) – Slovakia Mac Canby (SEG 2003) Despite the continued economic downturn and the advent of worldwide recession, quality exploration and development projects continue to quietly move forward around Europe. Most of the positive news includes funding of good advanced targets, funding of mine development and construction, significant resource upgrades, positive permitting progress, and consolidation of smaller, perhaps cash-strapped companies, into larger, more economically viable entities. Funds for grassroots exploration are clearly limited, but money for more advanced stage exploration projects can be and has been found in the market. Economic downturn is also seemingly providing an unanticipated “silver” lining for mining companies in that the worldwide resource nationalism during the recent times of extremely high metals prices has begun to be superceded by resource pragmatism. Governments and mining companies are beginning to work together to find common ground in all facets of the mining business, allowing for projects to continue in a safe and environmentally and socially positive manner. New mining laws, fair to all stakeholders and properly enforced, are showing up in many places of exploration and mining interest. For those with future vision (plus good projects and access to financing!), investment now, in tough times, should reap great benefits in the more positive times ahead. Following is an extensive country by country review of the exploration business in Europe during the March-April- May time period. Not all news comes from the field… ALBANIA Tirex Resources announced the closing of two financings totaling ~C$ 2.4 million, to fund the ongoing exploration program on their Mirdita property. The underexplored Mirdita district includes a number of known VMS deposits and exciting potential for discovery of further, significant deposits. ARMENIA The most significant news from Armenia is the first independent resource announcement concerning the Amulsar high sulfidation epithermal gold deposit discovered by the Lydian International-Newmont Overseas Exploration joint venture. Lydian announced a mineral resource of 1 Moz of oxide zone gold at the Tigranes- Artavasdes prospect in the Amulsar project area. Exploration is ongoing at several more targets on the property. The project has the looks of becoming a new gold district. Lydian also announced that the government of Armenia had awarded the company a 25-year mining license for the Amulsar project, this being one of the first mining licenses granted under the new Armenian mining law. Lydian also raised approximately C$1.4M from the International Finance Corporation for continued ex - ploration at Amulsar by completing a previously announced private placement. The re-opening of the Shahumyan polymetallic mine at Kapan was announced by Dundee Precious Metals, Inc. Finalization of the agreement with the Armenian government on the extension of the mining license and a miningconcentrating optimization program clearly contributed to the restart plans. AUSTRIA Sandvik AB, the Swedish equipment manufacturer, is purchasing the Wolfram Bergbau und Hütten GmbH tungsten mine and processing plant in St. Martin and Mittersill, Austria. Sandvik is the mine’s largest customer for its tungsten carbide powder product. BULGARIA Dundee Precious Metals, Inc. completed a positive update to the Chelopech Cu-Au mine expansion plans feasibility, including a new reserve and resource estimate. The project is now moving forward after completion of an agreement between Dundee and the Bulgarian government on the joint construction of the copper-gold processing plant. FINLAND Activity related to gold exploration, development, and production remains positive in Finland, while relatively low base and ferrous metal, uranium, and PGE prices have curtailed or halted activity in those commodities. At the Kittila mine, Agnico Eagle has increased reserves to 3.2 Moz of gold, with planned annual production of 150,000 oz per year until at least 2023. Development of the mine continues, with commissioning of the autoclave ongoing and underground development continuing according to plan. Commercial production is expected by midyear. The company is currently working on an expansion study which should be completed by the end of 2009. Exploration at Kittila continues with 11 rigs working on the property, with focus on resource conversion below the Suuri and Roura deposits, and along strike. Dragon Mining continues to mine gold at Orivesi, while continuing to explore and expand the deposit. Pit optimization studies at the Jokisivu open cut mine have been completed, and Dragon is ready to open the mine. Exploration along the Hanhimaa shear zone, 10 km west of the Kittila mine in the Central Lapland greenstone belt, has resulted in the discovery of three gold-silver-base metal occurrences. Work is ongoing. Nordic Mines reports an upgraded resource of just over 1 Moz gold at the Laiva deposit in west central Finland. Endomines has announced an increase of 90% in resources to 200,000 oz for four of the gold deposits held by the company in the Ilomantisi greenstone belt in easternmost Finland. However, it is probable that both companies still need significant funding in order to become miners. GREECE Eldorado Gold Corporation is in the process of completing a pre-environmental impact assessment for its
JULY 2009 No 78 SEG NEWSLETTER 45 Perama Hill low-sulfidation oxide gold project in northern Greece. Approval of the document by the Greek government would lead to the submission of a full impact assessment in 2010 and possible final approval of the EIA in 2011. Under this schedule, mine construction could commence in 2011. Production continues at the Stratoni Pb-Zn-Ag mine in northern Greece, operated by European Goldfields Ltd. (EGO). The company is continuing with an ongoing development program at the mine and believes that the mine exploration program will replenish reserves mined each year. At the Skouries porphyry Au-Cu development project, located 35 km from Stratoni, European Goldfields has now received the basic engineering package for development of the mine. Procurement of long lead time processing equipment is underway and various engineering and architectural studies are moving towards completion. Finally, at EGO’s third project in Greece, the Olympias massive sulfide deposit, located 8 km from Stratoni, the company continues to sell gold from stockpiled pyrite concentrates. The company is working closely with the Greek Ministry of Environment to produce an acceptable EIA to treat the historical tailings from the old mine to extract the remaining gold and to clean up the Olympias Valley. EGO is also working with the authorities to produce a plan to mine the rest of the Olympias deposit. European Goldfields is actively exploring in northern Greece and has identified four new zones of potential massive sulfide mineralization near Stratoni, Olympias, and the Piavista massive sulfide deposit. EGO has identified two large targets in a 17 × 8 km belt of porphyry intrusive rocks. Porphyrystyle mineralization has been identified in the field, and the company plans to drill at these targets in conjunction with exploration work at Piavista. IRELAND Minco plc and JV partner Xstrata continue to drill on the Pallas Green project, located at the southern boundary of the Irish Midland orefield in County Limerick. Four drills are presently operating in the Northeast Extension area and in the southern extension of the Tobermalug zinc-lead massive sulfide deposit. Tobermalug is one of a cluster of sulfide lenses situated in a 25-kmlong and 2-km-wide west-northwest– trending alteration zone. The Galmoy mine, located in County Kilkenny and operated by Lundin Min ing Company, will cease mining operations during 2Q, 2009. Lundin reported that low zinc prices were the main reason for closure and that operations will wind down in an orderly fashion. Following closure, remaining rehabilitation of the mine site will be completed. Belmore Resources holds 11 exploration licenses in County Clare in SE Ireland. Lundin Mining recently signed an earn-in agreement with Belmore to operate the County Clare JV. Presently there are three rigs active on the Kilbricken discovery, and Belmore has already announced a 21+ m intercept of 15.8% zinc + lead and 94.4 g/t silver. KOSOVO Lydian International announced that they had completed a private placement with the European Bank of Reconstruc - tion and Development for approximately C$1.6M. The funds will help with the exploration of the Drazhnje Zn-Pb-Ag massive sulfide prospect. NORWAY London-based Avocet Mining has nearly completed a takeover bid for Oslo-based gold explorer and mine developer, Wega Mining ASA. Wega is constructing the Inata gold mine in Burkina Faso, while Avocet operates Penjom gold mine in Malaysia and the North Lanut gold mine in Indonesia. POLAND Adelaide-based Strzelecki Metals (formerly Primary Resources) provided an inferred resource for the Myszkow porphyry Mo-Cu-W deposit in southern Poland. The deposit contains 726 Mt of 0.12% Mo equivalent inferred resource, located within a larger envelope of 1,327 Mt of 0.096% Mo-equivalent mineralization. The deposit appears to be one of the largest known porphyry Mo deposits. The Polish Government originally outlined the deposit in the 1970s and 1980s. PORTUGAL Lundin Mining continues to replace and add reserves to the Neves-Corvo copper-zinc mine in the pyrite belt of southern Portugal. Copper reserves were largely replaced by infill drilling during 2008. Zinc reserve tonnage increased by 67%, largely from the Lombador South and Neves South deposits within the mine area. Zinc measured and indicated resources increased by 30%, with the majority of the mineralization coming from the recently discovered Lombador East deposit, which remains open both up- and downdip. The mine has been in operation since 1989. ROMANIA Gabriel Resources will raise approximately C$100M in a public offering and a concurrent private placement. The funds will be used for social and development work at Rosia Montana. The company reports that local and regional politicians are voicing strong support for the project to the new coalition government. Unemployment in the Rosia Montana area is over 80%. Is there a message here? European Goldfields announced completion of a definitive feasibility study for the Certej Au-Ag project, acceptance of the study by the government, the update of mining permits, and an extension of the potential mine life to 16 years. Permitting is in the final stages, and the company appears to be working well with all stakeholders. SLOVAKIA As reported in the last issue of SEG Newsletter, EMED Mining announced a 1.1 Moz resource at the Biely Vrch deposit in the Detva gold district. What is equally interesting is the potential for more gold and gold-copper deposits in the porphyry district. The Detva district has been explored and mined intermittently for past 1,000 years, but only now is being explored in a systematic manner. EMED has advanced at least four other prospects to drilling stage, or close to drilling stage. SPAIN Inmet Mining resumed mining operations and copper production at the Las Cruces VMS copper deposit, located near Seville at the eastern end of the Iberian pyrite belt. Mining had been suspended due to regulatory concerns over use of water in the mine. The Water Authority of Andalucia is now in the process of amending the water permit for the mine. Iberian Minerals completed an underwritten financing of C$40M. The funds will be used to complete construction of the Aguas Tenidas copper-zinc mine. The VMS deposit is located in the central part, northernmost limb of the Spanish portion of the Iberian PYRITE belt. The mine achieved start-up in both copper and zinc circuits, but had to curtail activity until acquisition of funding. The mining plan for the near future is to extract higher grade massive and stockwork copper ore, and explore and delineate easily accessible copper-bearing stock- to page work material. 46 ... EXPLORATION REVIEWS
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Stewart R. Wallace — 1919–2009 - Society of Economic Geologists

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