8 Jan 2020 07:00
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8 January 2020
Trans-Siberian Gold plc
("TSG", the "Company", or the "Group")
Mineral Resource Update - Asacha Gold Mine
Trans-Siberian Gold plc (TSG.LN), a low cost, high grade gold producer in Russia, announces an update of the Mineral Resource Estimate for the Asacha Gold Mine in Kamchatka, Far East Russia.
The mineral resource at Asacha occurs in two zones: Main zone (currently being mined) and East zone (not yet mined). The Main zone hosts six defined veins, with the majority of the resource contained in two of these, QV1 and QV2. Three veins have been defined in the separate East zone. The Main zone has a strike length of approximately 1,500m, whilst the East zone is approximately 400m.
The Mineral Resource Estimate ('MRE') for the Asacha Gold Mine was updated by Seequent UK Ltd ("SUKL") as at 01 December 2019. SUKL has updated the Asacha deposit's MRE at the end of every year from 2012. The purpose of these updates is to incorporate new data available from exploration, drilling, mining development and to account for mining depletion.
The focus of the MRE has been to incorporate new resource drilling on QV1 and QV2 in the Main zone and QV25 in the East zone. As reported on 19 September and 22 October 2019, preliminary internal estimates indicated that the existing in-situ resource may have been overestimated. A complete re-analysis of the MRE model inputs has now been undertaken, resulting in a reduction to the MRE, due to multiple contributing factors such as new drilling data, updated vein interpretations, revision of estimation parameters (in particular top capping), additional mine induced sterilisation and a change to reporting by linear cut-off grade. SUKL's full report is available on the Company's website at: www.trans-siberiangold.com
Alexander Dorogov, Chief Executive Officer of TSG, commented:
"I am pleased with the work that the team at Asacha has done to update the Mineral Resource Estimate. We have invested heavily in improving our understanding of the ore body through a significant drilling campaign which confirms our expectations and provides the basis for better mine planning out to 2024. The resource will be supplemented by additional ounces targeted in an accelerated exploration programme as well as existing stockpiles. A new drilling campaign of approximately 8,000m around Vein 25 in the East Zone is already underway. We are confident that we have the time, capital and skills to upgrade the mineral resource at Asacha. Formal guidance for 2020 will follow shortly, but at this stage we anticipate annual gold production to be in line with recent years."
Mineral Resource Estimate
The Mineral Resource Estimate, classified according to the guidelines of the JORC Code (2012), for the Asacha Gold Mine as at 01 December 2019 is shown in the following table:
Classification | Zone | '000 tonnes | Au (g/t) | Ag (g/t) | Au ('000oz) | Ag ('000oz) |
Measured | Main | 72 | 12 | 37 | 28 | 85 |
Indicated | Main | 124 | 10 | 48 | 40 | 193 |
Indicated | East | 43 | 31 | 39 | 42 | 54 |
Total M&I |
| 239 | 14 | 43 | 111 | 332 |
Inferred | Main | 101 | 14 | 30 | 45 | 98 |
Inferred | East | 211 | 23 | 36 | 157 | 245 |
Total Inferred |
| 313 | 20 | 34 | 202 | 343 |
Notes:
1. Resources are reported above 4m*g/t Au cut-off grade
2. Resources are reported after mining depletion
3. Tonnage and grades have been rounded to reflect an appropriate level of precision
4. Rounding may mean that columns do not sum exactly
5. Mineral Resources are classified according to the definitions of the JORC Code
Year-on-Year Comparison
The total (Measured + Indicated + Inferred) declared Mineral Resource Estimate has decreased from 553,000oz Au and 1,314,000oz Ag reported as at 31st December 2018 to 313,000oz Au and 675,000oz Ag as at 01 December 2019.
The following table illustrates the change in the gold estimates for the Main zone and East zone:
Description | Au (oz) |
Resource Estimate as at 31 December 2018
| 553,052 |
Mining depletion | -58,048 |
Sterilisation | -78,937 |
Rockfall | -2,522 |
Difference due to new data and interpretation | -84,448 |
Difference due to revised estimation parameters | -16,539 |
Resource Estimate as at 20 December 2019 | 312,558 |
Mining depletion, Sterilisation & Rockfall
The Main zone was depleted in the usual manner and consistent with previous estimates. Additionally, this included areas that TSG considered will not be mined due to stability issues and areas that are deemed uneconomic. In previous estimates, SUKL have included some remnant areas of mineralisation around the periphery of the upper levels of the mine. However, following the collapse of the older workings on Main zone there is no longer any realistic prospect that these areas of remnant mineralisation can be safely recovered due to geotechnical instability.
Difference due to data and interpretation (including drilling)
The mineral resource model has been updated to incorporate new diamond drilling on QV1 and QV2 in the Main zone and QV25 in the East zone.
On the Main Zone, 94 core drill holes for 6,894m were drilled underground from the 100m to infill below 100m, targeting vein extensions on both QV1 and QV2. This represents a large increase in the amount of drilling available on Main Zone targets below the 100m level. In addition, 329.8m of channel sampling in 136 separate channels were collected, mainly from the north end of the Main Zone on QV1 at the 100m level, and from the southwards extensions of development on QV2 between 100 and 150m. In the Main Zone, gold mineralisation is becoming weaker and more erratic with depth, with an increase in the presence of base-metals minerals. This vertical zonation is typical of epithermal systems.
On the East Zone, 21 diamond drill holes targeted two veins, QV18 and QV25. Infill drilling on QV25 consisted of 19 drill holes totalling 4,752.5m and on QV18 two drill holes testing along strike vein extents totalling 450m. QV25 is a priority for TSG, as it is regarded to have the potential for exploitation in the near future.
Summary of 2019 drilling campaigns:
Area | Target Veins | Hole Type | Hole Diameter | No. of holes | Total (m) |
East | QV25, QV18 | Diamond | HQ | 21 | 5,202.5 |
Main | QV1, QV2 | Diamond | HQ | 94 | 6,894.1 |
Main | QV1, QV2 | Channel | n/a | 136 | 329.8 |
Total |
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| 251 | 12,426.4 |
Figure 1. Long section looking west of 2019 drilling and sample data for Main Zone.
Notes:
1. Red collars indicate 2019 data, blue pre-2019. 2019 drillhole traces in solid purple originating from100m.
Figure 2. 2019 Drilling on the East Zone, red collars indicate 2019 campaigns.
Notes:
1. Red collars indicate 2019 data.
Figure 3. Long section view of QV25 showing true width and grade of intersections.
Notes:
1. 2019 drill hole traces in purple.
Difference due to estimation parameters
Top caps have historically been applied to the MRE to allow for the highly skewed grade distributions that typically occur in epithermal deposits, with annual reconciliation against production used to validate the choice of cap value. Over the previous 12 months, as mining progressed into less well drilled and lower grade parts of the Main Zone below the 150m level, more localized reconciliation against production sampling indicated that mineral resources were locally overestimated, likely due to insufficient constraint on high grade samples. A complete re-analysis of estimation parameters for all veins was undertaken, in particular the treatment of extreme grades through top-capping. Consequently, a more stringent top capping has been used for this estimate than in previous models.
Cut-off Grade
Previously SUKL have reported the in-situ resource using an Au grade cut-off of 4g/t. In the lower levels of the mine, veins are thinner, and it is more appropriate to apply a dual cut-off on both contained metal (linear grade=grade*thickness) and grade. The updated MRE is reported above a dual cut-off of 4m*g/t (vein thickness*Au grade) and 4 g/t Au. The effect of this change is minimal.
2020 Exploration
The Group will be conducting both underground and surface drilling campaigns during 2020. A total of approximately 22,000m of surface drilling will target the lateral extents of the Main zone and QV25. A further 2,000m of underground drilling will be conducted on the Main zone at depth.
SKUL have classified QV18 and QV25 as Exploration Targets[1] with the potential for ranges of:
·; QV18: 33,000t to 270,000t at a grade of between 3.5g/t and 5g/t; and
·; QV25: 30,000t to 60,000t at a grade of between 15 to 35g/t
The potential quantity and grade of the Exploration Target material is conceptual in nature, there has been insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource.
The low sulphidation epithermal style of mineralisation found at the Asacha Gold Mine is favourable for high-grade deposits. The Asacha licence area and the regional district more widely remains under-explored which the Company believes presents an opportunity to define local, near mine extensions to mineralisation and exploration targets. As such, the Company expects to increase the scope and scale of its exploration activities. Additional details of the Company's exploration plan will be published shortly.
Rodnikova
The Rodnikova deposit is not reflected in this Mineral Resource Estimate. The Company has engaged a different Competent Person to prepare a Mineral Resource Estimate to be reported in accordance with the JORC Code (2012), which should be complete in January 2020.
ENDS
Contacts |
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TSG |
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Stewart Dickson | +44 (0) 7799 694195 |
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Arden Partners plc |
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Paul Shackleton (Corporate Finance)Tim Dainton / Fraser Marshall (Equity Sales) | +44 (0) 207 614 5900 |
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Hudson Sandler (Financial PR) | +44 (0) 207 796 4133 |
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Charlie Jack / Katerina Parker / Elfreda Kent |
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About TSG
TSG is focused on low cost, high grade mining operations and stable gold production from its 100% owned Asacha Gold Mine in Far East Russia. The Group also holds the licence for the development and exploration of the Rodnikova deposit, one of the largest gold fields in South Kamchatka.
Additional information is available from the Company's website: www.trans-siberiangold.com
Qualified Person Review
The updated Mineral Resource estimate was prepared by Ms. Carrie Nicholls (Senior Evaluation Geologist, SUKL).
The information in this release that relates to the updated Mineral Resource estimate is based on, and fairly represents, information, which has been compiled by Ms. Nicholls.
Ms. Nicholls is a geologist with more than 15 years of experience in geo-statistical analysis, geological modelling and resource estimation. She has extensive experience in open pit gold mining operations in Africa and Venezuela and has undertaken geo-statistical and geological modelling work for a variety of deposits including gold, copper and niobium. She holds a B.Sc. (Hons) degree in geology from Bristol University, UK and a M.Sc. in Mineral Resources from the University of Wales, Cardiff, UK. She is a member of the AusIMM and Geological Society of London.
Ms. Nicholls has sufficient experience relevant to the styles of mineralisation and type of deposit under consideration and to the activity that is being undertaken to qualify as a Competent Person, as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms. Nicholls is a full time employee of SUKL and has consented to the inclusion of the matters in this announcement based on the information in the form and context in which it appears.
Technical Glossary
"Au" | the chemical symbol of gold |
"Ag" | the chemical symbol of silver |
"cut-off grade" | the lowest grade, or quality, of mineralised material that qualifies as economically mineable and available in a given deposit. May be defined on the basis of economic evaluation, or on physical or chemical attributes that define an acceptable product specification.
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"Exploration Target" | is a statement or estimate of the exploration potential of a mineral deposit in a de ned geological setting where the statement or estimate, quoted as a range of tonnes and a range of grade (or quality), relates to mineralisation for which there has been insufficient exploration to estimate a Mineral Resource.
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"g/t" | grams per tonne
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"Indicated mineral resource" | a part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed
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"Inferred mineral resource" | a part of a Mineral Resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality and reliability.
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"JORC Code" | the code for reporting of the Australasian Joint Ore Reserves Committee, which is sponsored by the Australian mining industry and its professional organisations. The code is widely accepted as a standard for professional reporting purposes for reporting of mineral resources and ore reserves.
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"Measured mineral resource"
| A part of a Mineral Resource for which quantity, grade (or quality), densities, shape, and physical characteristics are estimated with confidence sufficient to allow the application of Modifying Factors to support detailed mine planning and evaluation of the economic viability of the deposit.
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"Mineral Resource" | a concentration or occurrence of material of intrinsic economic interest in or on the Earth's crust in such form, quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories.
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"Mineralisation" | the process or processes by which a mineral is introduced into a rock, resulting in a valuable or potentially valuable deposit. It is a general term, incorporating various types; e.g., fissure filling, impregnation, and replacement. |
Market Abuse Regulations
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ('MAR'). Upon the publication of this announcement via Regulatory Information Service ('RIS'), this inside information is now considered to be in the public domain.
Disclaimer
This announcement contains "forward-looking statements" - that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance, and often contain words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "should" or "will." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For us, uncertainties arise from the behaviour of financial and metals markets, fluctuations in interest and/or exchange rates and metal prices; and from numerous other matters of national, regional and global scale, including those of a political, economic, business, competitive or regulatory nature. These uncertainties may cause our actual future results to be materially different that those expressed in our forward-looking statements.
1 Exploration Target values are not included in the Mineral Resource Estimate.