Vancouver-based Sunridge Gold Corp. (CVE:SGC) (OTCQX:SGCNF) unveiled Tuesday an initial NI 43-101 resource estimate for its Adi Rassi copper-gold deposit - the fifth deposit defined by the company on its Asmara project in Eritrea.
The junior mineral explorer reported an inferred mineral resource of 15.77 million tonnes at Adi Rassi, with an average grade of 0.54% copper and 0.33 grams per tonne (g/t) gold.
This translates to contained metal of 189.06 million pounds of copper, and 167,000 ounces of gold, with the resource area remaining open for expansion in most directions, the company said.
Further expansion drilling is planned next year, it added.
"The defining of a fifth deposit by Sunridge continues to show the prolific nature of the Asmara Project area," said president and CEO, Michael Hopley.
"We are pleased with this initial mineral resource estimate for the Adi Rassi deposit based on just twenty-two new drill holes by Sunridge and believe that further drilling will significantly expand and upgrade the mineralization."
Adi Rassi, which is less than 10 km from the Debarwa deposit and has paved road access, is the fifth mineral resource defined by Sunridge on the Asmara project.
In May, the company released a prefeasibility study on the other four deposits - Adi Nefas, Emba Derho, Gupo and Debarwa - that analyzed the optimum economic scenario to construct a single centralized processing plant near the Emba Derho deposit.
The economic analysis, using 5-year average metal prices and a 10 per cent discount rate, showed the project to have a pre-tax net present value of $555 million and an internal rate of return of 27 per cent.
A feasibility study is now underway for the project, and is slated to wrap up in April of next year.
The company said today that initial results from ongoing metallurgical testwork suggest that copper, gold and silver can be "successfully recovered" from the mineralized material at Adi Rassi using standard flotation methods, which is compatible with the recovery processes on the other deposits at Asmara being used in the feasibility study.
Adi Rassi's mineralization is distinctly different to Sunridge's four other deposits on the Asmara project, however. Three of the deposits - Emba Derho, Adi Nefas and Debarwa - are volcanogenic-massive sulphide (VMS) deposits, while Gupo is remobilized gold only.
The mineralization at Adi Rassi though is considered to be remobilized copper and gold from a distal source, possibly unidentified buried VMS mineralization, Sunridge said.
The mineralization at the fifth deposit is associated with a major shear zone, according to the company, which trends northeast for more than 3 kilometres. The resource estimate was based on mineralization that extends over a strike length of 400 metres, and a width of up to 80 metres, with a maximum vertical depth of around 360 metres.
The report was estimated using 26 exploration drill holes, 22 of which were diamond core holes drilled by Sunridge and 4 of which were drilled by a previous operator.
Aside from the Asmara project, Sunridge also has exploration properties in Madagascar.
The company recently closed a $10.8 million financing, which allows it to maintain work on the feasibility study at "full speed" and complete the work on schedule, it said last month.
Based on new metallurgical testwork, the feasibility study will now include early mining of the direct shipping ore (DSO) from Debarwa, and early heap-leaching of the surface gold material from the project, Sunridge said, allowing more revenue to be generated earlier.
As a result, cash flow is expected a year earlier than presented in the prefeasibility study, now anticipated in 2015.
Initial capital costs are also anticipated to be lower due to the new operating scenarios.
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