Xanadu Mines Ltd (ASX:XAM) (TSE:XAM) (FRA:02X) contractor CSA Global visited the tri-listed company’s majority-owned Kharmagtai Copper-Gold Project area in Mongolia during September 2018, finding last month the data was acceptable to use for a mineral resource update.
Site visitor, CSA principal geologist Warren Potma, co-authored a technical report shared with the market with CSA Global resource manager and principal geologist Dmitry Pertel and AGP Mining Consultants Inc partner and principal process engineer Andy Holloway.
READ: Xanadu Mines reveals major resource upgrade for Kharmagtai
The CSA Global report dated December 2018 found, “Review and analysis of both the historical and recent quality assurance, quality control (QAQC) data, procedures and protocols indicate that the quality of data is acceptable to allow a mineral resource to be reported in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) guidelines.
“The risk associated with the quality of the data is believed to be low.”
In late October 2018, the company released an interim resource update to use in the underway open-pit scoping study it is preparing for a starter project.
The update increased copper tonnages by 400% and gold by 249% at Kharmagtai in the South Gobi region.
The interim upgrade to the Kharmagtai resource estimate results in a total of 1.936 million tonnes of copper and 4.311 million ounces of gold.
CSA Global’s report backed the October update, with each author writing their sections “fairly and accurately” supported by the company’s October 31, 2018 news release.
Xanadu’s managing director & CEO Dr Andrew Stewart was pleased with the finding, saying in December 2018, “We are extremely pleased to release the technical report supporting our recent mineral resource upgrade for Kharmagtai.
“This resource upgrade and report represents another step forward for our flagship project Kharmagtai.”
Stewart said at the time of the release, “With a 400% increase in contained copper, we are confident that the upcoming scoping study will show a financially robust open-pit starter project that will pave the way for Kharmagtai to develop into another high-quality Mongolian mining operation.
“With the discovery of Zaraa and mineralisation intersected down to 1,200 vertical metres and still open, we believe there is an opportunity for a very large-scale system.”
Stewart highlighted the company’s discovery costs for copper was 1 cent a pound, rather than the global average of about 4-7 cents a pound.
Xanadu listed on the Toronto Stock Exchange in October 2018, with its reporting now to follow Ontario Securities Commission, Toronto Stock Exchange and CIM Canadian reporting parameters.
CSA Global’s technical report, shared with the market last month, takes this into account.
The report which used Micromine pit optimisation modelling featured optimal pit shells and a pit optimisation base case with ore mining and waste mining costs of $2.49 a tonne.
CSA Global viewed the ‘optimal’ discounted pit shell for the base case was “2,370 metres-long and 1,600-metres wide and approximately 940-metres deep for the combined Altan Tolgoi and Tsagaan Sudal deposits, and it was 630-metres long and 410-metres wide and approximately 240-metres deep for the Zesen Uul deposit.”
The pit shell was used to code a block model so the mineral resources could be divided for open pit and underground mining methods.
SOURCE: PROACTIVE INVESTORS
DATE: JANUARY 14, 2019