YTC Resources (ASX: YTC) has intersected strong lead-zinc mineralisation in the target zone over 200 metres north of the existing Resource at its wholly owned Hera Gold Deposit in New South Wales' Cobar Basin.
The latest results were from the first drill hole testing the down hole electromagnetic target off the northern end of the Hera deposit, with intersections including a 6.4 metre down hole zone hosting bands of semi-massive lead-zinc sulphides.
The discovery highlights the exploration upside at Hera with the mineral system shown to remain completely open to the north.
Meanwhile, drilling has also extended economic grade mineralisation to over 150 metres south of the Hera Resource and shows the system to be open to the south along plunge.
Assays of 14 metres at 2.4 grams per tonne (g/t) gold, 22g/t silver and 6.6% lead plus zinc from 628 metres, including 6 metres at 4.54g/t gold, 15g/t silver and 5.3% lead plus zinc, were returned from one hole drilled to test a strong down hole electromagnetic target to the south of Hera.
A wedge hole was completed around 60 metres above the intersection and has recorded a strong sulphide intersection from about 566 to 578 metres down hole, which confirms the vertical continuity of the mineralisation.
Rimas Kairaitis, managing director, commented: "These results have really opened up the Hera mineralisation to both the north and south.
"To see such strong mineralisation in the northernmost drill hole starts to excite us as to how large the Hera system may become."
Drilling continues at Hera with follow on holes to test above the strong intersection in the northern section and below the strong results in the southern section.
A second rig is being sourced to begin drilling on the down hole electromagnetic targets generated at Nymagee, with the second rig expected to commence within the week.
Path to development
YTC has received New South Wales Government approval for its Hera Gold Project, which is set to generate gross revenues of around A$510 million in Stage 1 at very low costs of just $395 per ounce after lead and zinc credits.
The approval provides conditions for the construction and establishment of an underground mine and surface processing operations.
Hera, which could be in development by late 2012, has been confirmed as a financially and technically robust project, with a Definitive Feasibility Study already completed.
Importantly, final approval conditions are within YTC's expectations and no adjustment to the DFS capital expenditure is anticipated.
The Hera development has a pre-production capital requirement of A$73.5 million.
With a Reserve of 423,471 ounces gold equivalent at 7g/t, and a Resource of 677,200 ounces gold equivalent at 8.6g/t, around A$510 million in revenue is forecast to be generated in Stage 1 - with a minimum 7.3 year mine life.
Hera is also open to the north and south, providing the potential for future discoveries which could deliver additional ounces - extending the mine life and improving the economics.
With YTC expecting to fast track gold revenues from Hera, the establishment of processing infrastructure allows for the integration of the bigger Nymagee copper deposit, which is located just 4 kilometres away.
The Nymagee resource hosts 8.1 million tonnes containing 96,000 tonnes of copper, 2.3 million ounces of silver, 27,000 tonnes of lead and 53,000 tonnes of zinc, for an estimated 125,000 tonnes of copper equivalent.
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