Electromagnetic surveys discovered the extensions to the currently defined Resources at Jervois in the Northern Territory.
Conductors, indicating extensions, were located at all of the deposits - Marshall-Reward, Green Parrot and Bellbird - on which the surveys were focussed.
All conductors are in areas of no previous drilling and the company has started drill testing of the conductors and other priority targets has commenced immediately.
"The EM results follow the continuing reports of high grade assays from drilling at Jervois and the expanding areas of mineralisation," managing director Simon Milroy said.
"The conductor north of Reward suggests that the Resource extends 500 metres past the current known limit, and that alone has the potential to significantly increase the total Resource at Jervois.
"In light of this and other indicators, we must ensure that the current pre-feasibility study is based on the best total Resource figures available. We will reschedule the Resource Update from May to August to include results from the further drilling, and complete the PFS shortly after that."
This has the objective of generating a significant resource increase.
Electromagnetic Survey Details
At Reward a fixed loop (FLEM) survey located a strong conductor extending 500 metres north from the existing Reward and East Reward deposits.
The conductor is in line with the currently defined resources and is interpreted to be caused by copper sulphide mineralisation.
South of Green Parrot and east of Reward, short strike length conductors have been located that will require field follow up and possible drill testing.
At Marshall-Reward and Bellbird, down hole (DHEM) surveys have generated strong conductors that relate to the known copper and lead-silver-zinc styles of mineralisation.
The DHEM has also located off hole conductors beyond existing drilling both along strike and at depth. Hole KJCD034 generated a conductor 200 metres below the current resource indicating that the mineralisation extends well below the existing extent of drilling.
The success of both the 20,000 metre resource extension drilling program concluded in February and the electromagnetic surveys has caused KGL to commence a second phase drilling program immediately.
Extension drilling had intersected a new second zone of copper mineralisation just 50 metres east of the existing Reward resource.
The Phase 2 drilling will:
- Test targets at Marshall-Reward and Bellbird generated during the first phase of drilling;
- Focus on the northern extension of Reward as delineated by the EM survey, and on the newly discovered East Reward deposit 50m to the east;
- Follow up the massive lead-silver-zinc sulphide intersected at Reward in KJCD042 and KJCD048 - the DHEM survey indicates that the high grade mineralisation extends beyond the limits of current drilling and may improve; and
- Aim to generate initial Inferred Resources at the Cox's Find and Rockface prospects.
KGL Resources is looking at a potential significant increase in total resource at Jervois as a result of the electromagnetic surveys discovering extensions to the currently defined Resources which would be a catalyst for a re-rating.
As an indication of how prospective the survey results and earlier drilling had been, the company has immediately kicked off a second phase of drilling and has decided to reschedule the Resource Update from May to August in hopes of generating a significant resource increase.
Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX "Small and Mid-cap" stocks with distribution in Australia, UK, North America and Hong Kong / China.