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WPG Resources Identifies 14 Prospects At Tunkillia For Priority Exploration

WPG Resources (ASX:WPG) has identified 14 priority exploration prospects within its Tunkillia exploration tenements in South Australia that could result in further gold discoveries.

The prospects were selected from 33 targets generated from a major review of historical data compiled by previous explorers and are all located within EL 4812, which hosts the Tunkillia 223 gold deposit.

High priority prospects include:

- Three new prospects - Cooper, Hatchet and Chainsaw.
- Area 51, which is favourably located in the Yarlbrinda Shear Zone (YSZ) along strike from the Tunkillia 223 deposit and is rated as a "walk up" drill target.
- Tomahawk Extended, where there is a target with a potential 700 metre strike length.

Follow-up work will include systematic close spaced calcrete sampling to follow up poorly defined anomalies, geophysical modelling and evaluation of potential geophysical targets in the regional data sets as well as rotary air blast, aircore and reverse circulation drilling.

The Tunkillia 223 deposit has a contained resource of 558,000 ounces of gold and 1.48 million ounces of silver.

Previous Exploration

The historical exploration data in the region has been based on extensive calcrete gold geochemical sampling and it is estimated that a total of 12,084 calcrete samples have been collected and analysed over the area of the Tunkillia tenements.

Previous explorers then defined prospects through follow-up of spot high sample results with closer spaced calcrete sampling and then testing the ensuing anomalies with either RAB or aircore and RC drilling.

This method led to the discovery of the large Tunkillia gold deposit at the 223 prospect.

The historical data that was acquired by WPG also includes detailed aeromagnetic, TEMPEST airborne EM and in-fill gravity surveys completed over parts of the Lake Everard tenement (EL 4812) mostly focussed on the Yarlbrinda Shear Zone.

Further data includes gradient array IP, biogeochemical sampling, CHIM/MMI geochemical sampling and spectral scanning of reverse circulation chips.

The major detailed data review carried out by WPG was designed to establish the validity of the selection criteria previously used and to determine if further exploration was warranted.

The initial 14 prospects now targeted for further exploration have resulted from this analysis.

Tunkillia Gold Project

WPG acquired 70% of the Tunkillia Project in May 2014 from Mungana Goldmines Limited (ASX:MUX). It subsequently acquired the remaining 30% from Helix in November.

Tunkillia consists of three exploration licences that cover a combined area of 1,606.6 square kilometres.

Mineralisation was first discovered by Helix in late 1996, during a drilling program to test an extensive surface geochemical anomaly defined from calcrete sampling.

The gold-silver mineralisation at the Tunkillia 223 deposit lies in the north western part of the Tunkillia tenement block, and a mineral claim application has been lodged over this area.

The 223 deposit has supergene oxide and primary components. Primary mineralisation is hosted within a NW-trending shear zone cutting Proterozoic granites.

A broad corridor of low-grade mineralisation is present, in which higher-grades are typically associated with greater intensity of steep to moderately dipping quartz veins.

Analysis

The 14 priority prospects identified from a major review of historical data compiled by previous explorers presents WPG Resource with the opportunity to make further gold discoveries.

Any discovery will add value to the project, which already hosts the main 223 deposit and its resource of 12.3 million tonnes at 1.41g/t gold and 3.7g/t silver.

The company is currently conducting an in depth review of the potential development scenarios including optimisation studies.

Results will set the platform for WPG to redefine the project parameters and advance a new exploration and development strategy

Proactive Investors has a price target of $0.085 within 9-12 months.

WPG has cash and fixed term bank deposits of $3.48 million as at 31st December 2014.

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