The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Drills discover large high-grade gold lode northwest of mine North of 60 Mining News – February 15, 2019
Since acquiring Pogo last fall, Perth-based Northern Star Resources has significantly expanded known mineralization and made an exciting new gold discovery near the mine.
A cross section depicting Northern Star's interpretation of the Central Lodes vein system's relationship with the main Pogo stacked veins.
A map of the underground extension and definition drilling completed at Pogo's Liese vein system during 2018.
When Northern Star Resources Ltd. acquired the Pogo Mine, the Perth-based miner believed it could apply its underground mining experience in Australia to increasing high-grade gold resource and boosting production at its new Alaska asset. Five months into its official ownership of Pogo, Northern Star's exploration is generating outstanding results which are oft exceeding the company's already high expectations.
"Pogo is fast turning out to be everything we expected and more," said Northern Star Executive Chairman Bill Beament. "Our policy of investing in exploration and productivity is generating results which are entirely consistent with our goal of growing Pogo's mine life, production and cashflow."
US$25 million program
When Northern Star first looked into buying Pogo from Sumitomo Metal Mining Company, the Interior Alaska gold mine had roughly 10.45 million metric tons of resources and reserves averaging 12.2 g/t (4.1 million oz) gold.
While calculated carefully, these resources and reserves where not compliant to reporting standards required for publicly listed mining companies in Australia (Australian Joint Ore Reserves Committee) Canada (NI 43-101).
One of Northern Star's first orders of business on competing a definitive deal to buy Pogo was to have a resource calculated that met the Australian standard.
The JORC-compliant resource for Pogo, published in October, outlines 8.8 million metric tons of total resource averaging 14.7 grams per metric ton (4.15 million ounces) gold. This includes 3.3 million metric tons of indicated resource averaging 15.7 g/t (1.67 million oz) gold; and 5.48 million metric tons of inferred resource averaging 14.1 g/t (2.48 million oz) gold.
This resource excluded 765,000 oz of gold contained in satellite deposits that was included in the Sumitomo calculation.
"It is also very satisfying to match the previous 4.1-million-ounce non-JORC resource without including the 765,000-oz resources contained in the satellite deposits which formed part of that original estimate. The upshot of this is we have already increased the in-mine resource by 24 percent," Beament said at the time.
And, according to the drill results from Northern Star's aggressive drill program at Pogo, the in-mine and outlying resources are likely to increase substantially when the Australian company recalculates the ounces of gold at the high-grade mine.
At AU$35 million, or approximately US$25 million, the 2018 exploration and infill drill campaign at Pogo was by far the largest mineral exploration program in Alaska last year.
The results from this 133,136-meter drill program are equally impressive – extending the zone of known gold mineralization and discovering an exciting new zone within 800 meters of the underground workings.
Expanding the original Liese veins
The Liese Vein system, which has provided the majority of the 3.6 million oz of gold produced at Pogo so far, was a primary target of 88,344 meters of underground drilling carried out last year at Northern Star's new Alaska gold mine.
The best intercepts from drilling the Liese veins include:
• 5.8 meters (roughly 4.8 meters true-width) averaging 59.7 g/t gold;
• 22.5 meters (roughly 5.8 meters true-width) averaging 33.8 g/t gold;
• 6.4 meters (roughly 3.5 meters true-width) averaging 42.7 g/t gold; and
• 2.9 meters (roughly 1.7 meters true-width) averaging 72.9 g/t gold.
In addition to bolstering the confidence inside the resource area, Northern Star said the 2018 drilling has extended two of the primary Liese Zone veins – L1 and L2 – to the north, east and west. This includes an approximately 250-meter western expansion of two L2 veins – L2-07 and L2-08.
New Pogo South veins indicated
The 2018 underground drilling also expanded South Pogo, which is interpreted to be a southern, offset block of the main Liese system. This extension of the Pogo Mine was first reached by underground working in 2018 and the first South Pogo ore was mined around mid-year.
Utilizing the new underground development, Northern Star set up drill platforms to further define and expand South Pogo.
Highlighted intercepts from South Pogo drilling include:
• 8.7 meters (approximately 6.1 meters true-width) averaging 17.5 g/t gold;
• 6.7 meters (approximately 3.2 meters true- width) averaging 28.6 g/t gold; and
• 2.8 meters (approximately 2.7 meters true-width) averaging 30 g/t gold.
In addition to the two stacked veins previously identified at South Pogo, Norther Star said this drilling indicates that additional gold-bearing structures are present in the area.
The X-Vein factor
Underground drilling also defined and expanded the North Zone and X-Vein, nearly vertical vein systems north of Liese that are a departure from the flat lying veins that are typical of Pogo.
In 2018, 92 holes were drilled to define and extend these high-grade gold veins, referred to collectively as the NZ-XV system. Significant intersections from this drilling at North Zone and X-Vein include:
• 3.1 meters averaging 40.7 g/t gold;
• 5.5 meters averaging 18 g/t gold;
• 3.9 meters averaging 23.9 g/t gold;
• 3.6 meters averaging 25.1 g/t gold; and
• 1.1 meters averaging 84 g/t gold.
All these drill widths at are estimated to the true-width of the NZ-XV veins intercepted.
Northern Star has commenced long-hole stoping production in the NZ area with further expansion drilling planned for 2019 as this underground development provides additional drill platforms.
Northwest expansion to Fun Zone
The most exciting and immediate expansions of the Pogo Mine is to the northwest of Liese. The first area in this direction is the Fun Zone, a relatively recent discovery made prior to Northern Star buying the mine.
First ore production from the Fun Zone veins began in 2018 and Northern Star's drilling there focused on defining reserves in this northwest expansion area.
This drilling hit widths and grades typical of Pogo and some shorter intercepts with much higher grades. Highlighted intercepts from the Fun Zone drilling include:
• 3.4 meters averaging 14.8 g/t gold;
• 2.8 meters averaging 16.9 g/t gold;
• 1.3 meters averaging 144.5 g/t gold; and
• 0.4 meters averaging 80.1g/t gold.
All these drill widths at are estimated to the true-width of the Fun Zone veins intercepted.
Exciting discovery further northwest
As exciting as the Pogo underground drill results are, the 44,792-meter surface program made the most intriguing discovery of 2018.
This discovery, known as Central Lodes, is a new vein system about 800 meters northwest of the Fun Zone underground development.
The 47 holes drilled at Central Lodes last year encountered at least five individual stacked vein structures that are interpreted to be Liese-style faulted vein that are offset by a fault.
Significant intersections from Central Lodes surface drilling include:
• two meters (1.2 meters true-width) averaging 175.3 g/t gold from a depth of 410.4 meters;
• 3.6 meters (2.6 meters true-width) averaging 50.6 g/t gold from 260.5 meters;
• 14.3 meters (10.9 meters true-width) averaging 6.1 g/t gold from 453.3 meters;
• two meters (1.8 meters true-width) averaging 35.1 g/t gold from 257.7 meters; and
• 3.4 meters (2.2 meters true-width) averaging 26.8 g/t gold from 37.3 meters.
So far, drilling has outlined the Central Lodes veins over a strike length of about 650 meter and down-plunge for roughly 500 meters and the zone remains open in all directions. With four surface drills turning, the company continues to expand this enticing new discovery in 2019.
Heavy exploration investment continues
When it comes to exploration, Northern Star is not letting up on the accelerator. In fact, the company plans to complete an additional 97,000 meters of underground drilling and 37,000 meters of surface drilling by the end of June.
Adding four rigs in January, the Australian gold miner now has eight underground rigs focused on upgrading and expanding the resources within the four main zones currently being mined – Liese, South Pogo, North Zone and X-Vein, and Fun Zone.
In addition to the eight core rigs, an underground reverse circulation drill has been sourced to fast-track resource definition ahead of mining.
The four surface drills will continue to focus on defining and expanding a resource for the Central Lode vein system.
Incorporating the results from drilling to mid-year, Northern Star plans to publish an updated resource and reserve estimate for Pogo in August, which is expected to have a maiden resource calculation for Central Lode.
Beament said Northern Star's heavy investment into drilling at Pogo bolsters the company's original view that the company's first Alaska mine hosts enormous gold potential beyond what was already known.
"Many of these exceptional drilling results come from outside the existing resource and clearly pave the way for a significant increase in the mineral resources," said the Northern Star Resources executive chairman. "And, the infill results show we are well on track for a substantial maiden JORC reserve."
As part of the drive to further expand the Pogo resources, Northern Star has already secured key exploration and production approvals. These approvals now cover the proposed production site at the Central Lodes and stretch to the edge of Goodpaster, another very exciting gold prospect further to the north.
Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.
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