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Saturday, October 21, 2017

Interpreting my Bad Resources

In the last post I did a guesstimate calculation for Tina's South Ayawilca deposit, and I've received a few e-mails about how to interpret this data.







I also have 2 tables.



Occasionally, I make some excel errors, if you find some, please send me some abusive e-mails!







Tinka Update

I'm going to do a different spin on the post, initially focusing on the results and then look at some areas that have been under-drilled to see where Tinka can go to add some tonnes to and/or improve the quality (category) of their resources.

Summary

  • Some good infill holes (A17-085 and 096) in the core of the system
  • System is getting weaker to the east (A17-093) and to the SE (A17-094).
  • Narrow, albeit high-grade zones drilled to the east of the West Ayawilca resource (A17-083 and 085)
  • A few holes were drilled in the Chaucha, Zone 3 and Valley targets, but to date, no significant mineralization was discovered. However, early days.... 

Results

We are now looking at a mature exploration project. Tinka are now drilling the periphery of the South Ayawilca system, so the mineralization is now narrow and deep.

Blue = Sept PR; Red = Oct 2nd PR; yellow = result pending

Here are some sections

Hole A17-087 - SW end of the South Ayawilca Deposit
We can see that mineralization is dying out to the SW.


A17-071 (left) SE extent of mineralization



Mineralization dying out to the NE, but there are a few gaps. Hole A15-041 (to the right) hit multiple zones of moderate zinc mineralization.

The effect that this drilling has had on my officially bad resources is:

Full breakdown of ZnEq resources
We actually see just a slight increase in tonnes, but a decrease in grade. This is due to the slightly lower average grade due to all of the different cut-off limits.

This may sound negative, but essentially Tinka have been drilling at South Ayawilca all year, and have defined a new, deposit at Ayawilca. It will be interesting to see when a new technical report is released.

Opportunities

However, I have a question: Where are Tinka going to drill now? The drilling to date seems to have closed off the South Ayawilca deposit, where are they going to generate future intercepts and grow the resource.

There are 3 areas where they can focus:
  1. Infill drilling - designed to increase the confidence of the resource (increase the amount of M&I resources and reduce the amount of Inferred)
  2. Expansion - drill around the edges and between known mineralized zones.
  3. Green-fields - drilling of new targets
Each of these have a different risk vs reward levels, and I've spent a few days compiling as much of the drilling data as possible from technical reports and old press releases.

They have already started drilling some of the pother regional targets, but unfortunately, so far the results haven't been very positive, but we need to remember that they have only drilled 6-7 holes on them, so it is early days.

So, I will focus on the first two. Where are there: 
  • Under-drilled areas
  • Where some intercepts haven't been followed up on.
NOTE: there may be reasons certain areas haven't been explored (e.g. access issues, topography, hydrology etc.). I'm going to ignore these in this post as I'm not intimately familiar with the project.  

Unfortunately, I'm lazy. Fortunately, Leapfrog can all of the hard work for me. I drew a slice through the project, along the main zinc horizon.




I got leapfrog to create 50m and 100m (radii) buffers around each drill-hole.

Pink = under explored areas
I always do this as it shows me very quickly where there are un- and under-explored areas of a project, and as a simple geologist, I like to put holes in areas where they have a good change of getting high-grade zinc mineralization, like here:


Gaaaaaaapppp

That area is ripe for reaming. This is a perfect area for dumb exploration, simply whack a hole between 'em and you have an easy win! The area to the right of hole A12-008 could also do with a few holes as well, you'll get some decent grades for your PRs there.

However, this raises and interesting question for Tinka. Do they focus on drilling the known mineralization or start exploring the property for more deposits?

If they focus on drilling to improve the confidence in future resource calculations or keep looking for new deposits, and maybe even the BMF?






Thursday, October 19, 2017

Solgold Leapfrog project

I've received a few e-mails from people asking for the full Leapfrog project for Cascabel.

To open the project you need to have the saltest version of leapfrog Geo. You can download an evaluation copy from here - link

You can download the full Leapfrog project from here - link (145MB)

You can download the source drill-hole and surface contour data from here - link (10.8Mb)

I've also created a Leapfrog View containing all of the data I used - link (29.8Mb)

The viewer file can be open using the FREE Leapfrog Viewer program that can be downloaded from here - link

For anyone interested in Leapfrog, I'm working on compiling the Paca project data (as it has everything) into a training data set.

Thursday, October 12, 2017

Sol Gold Update - dark clouds on the horizon?

DISCLOSURE: I own shares in Sol Gold.

Sorry, I've been a bit snowed under with work, here is a quick update with the new drill holes released by Sol Gold a couple of weeks ago (link) and last week (link).

I've also done a complete rebuild of the model to make sure that it matches SolGold's maps as accurately as possible.

Summary

  1. Lots of grade smearing in latest PR
    • Hole 023R-D1 - 254m @ 1.16% Cu and 1.93 g/t Au, surrounded by material grading less than 1% CuEq
    • Hole 024-D1R - 512.9m @ 0.53% CuEq, in reality is 160.8m @ 1.19% CuEq surrounded by materail grading less than 0.5% CuEq
  2. High-grade (>1% CuEq) mineralization restricted to very narrow zones - SolGold even tell us that these zones are 2-4 times narrower than the reported intervals
  3. Bulk of the rock at Alpala grades <1%CuEq, which is probably uneconomic to mine
  4. I haven't updated my calculations as I don't have sufficient data quality (due to grade smearing) to produce an accurate number.

Background 

Just a quick summary on how the model was created and how the data was extracted, I know this is probably repeating a lot of what you already know, but it is important as it shows how results can be skewed.

All data is from the public domain (i.e. SolGold Press releases and presentations).

This means that I have to estimate hole locations (I georeference the plan maps), direction and dips. They are moderately accurate, but not perfect. there is a lot of guess work to make the hole line up as closely as possible.

The assay data comes from the Press releases, and I run it through Corebox's excellent Drill Hole Interval Calculator tool (link) to back calculate the residual grade of the rocks that surround the high-grade intervals. This is done to see how much of the grade is in that narrow high-grade zone, and if the surrounding rocks actually contain enough metals to be mined.

You can download the latest 3D viewer file from here (link), but you'll need to download the latest Leapfrog Viewer program to be able to open it.

When you look at the press releases for the Apala drilling you need to be thinking the following:

  1. How are the results being presented in the best way possible
  2. How will the deposit be mined

To be logical, let us start with point 2 - how are they going to get the crap out of the ground?

Here is a section through Alpala.



Decent mineralization starts at ~700m below surface, so if it gets mined, they will be doing it from underground. If used several images from a report written by Macquarie Research on Block caving (link).

Large scale underground mines have several 'unique characteristics'
  • They require a higher CAPEX than a similar sized open pit operation
  • Have higher operating costs
  • They take longer to develop and ramp up to full production
    • 5 years of underground development
    • 5-7 years to ramp up periods
As a result, they are much more sensitive to changes in metal prices and Capex. However, they can have better returns on invested capital compared to open pits.

However, Alpala is an exploration stage project, we don;t need to get bogged down by all that engineering crap. However, their repot had this figure.




Think of this as a reference diagram, plot on where Alpala should sit along the red lines.

Which line do you choose? Well, look at the assay tables in any of the press releases and you see how SolGold have calculated their CuEq grades



So, draw a line on it for US$1300/oz for Gold and $3/lb for copper, and then a horizontal line back to the Y-axis (CuEq%) to see what grade Macquarie think you need for a viable underground block-cave greenfield project like Alpala.

Here is my version:



So ~1.5% CuEq for Alpala to be a standalone, viable project.

Point 1: The results 

Why don't we now look at the assay table from the latest PR, reporting the mineralized intervals from holes 023R-D1 and 024-D1R.



At first glance, everything looks awesome. Hundreds of meters of decent grade material. I mean EVERYTHING in hole 23R-D1 is ore, hole 024-D1R is less good....

However, there are some clues that not all is as rosy as being presented.


Why are they giving intervals at different cut-off grades?
To me, this mean that that they a narrow very high-grade zone surrounded by low grade crap.

Why don't we back-calculate the residual grade

Hole 023R-D1


They have decent stuff from 958m to 1212m, but the rest is crap.

Hole 024-D1R


Same story here, but then again, they drilled the same zone hit by hole 024

For these 2 holes, only a very small portion (36% for hole 023R-D1, and none of hole 024-D1R are good enough for an underground mine. Most of what they drilled in these 2 holes is mineralized waste.

They even tell us that the mineralization is narrow in the text below the table. it says: 



This means that SolGold's geologist believe that the true with of the intercepts are 2-4 times narrower than the interval length reported in the table, so:
  • 745.1m @ 1.29% CuEq mean that the true width of mineralization is between 186.3 to 372.55m wide.
How does this compare to the rest of the drilling? Do we see similar narrow, very high-grade zones surrounded by mineralized waste?



Very hard to see on the plan map in the press release, but fortunately with the power of Photoshop, we can lighten this image. I've chucked on my interpretations for fun.



The most consistent mineralization is around holes

Here is a zoomed in part of holes 15, 16 and 23 which is where holes 29, 29D1 are all heading, but that zone only has a 200m x 150m horizontal extents. The rest of the high-grade is quite scattered and look to be dikes.

horizontal distance between the 2 lines = 35m


We can see the individual assays, they are a bit blurry as I've zoomed in really close, but you can see the individual assays and you can see how quickly the grade drops off around the high-grade samples.

Look at the plan map, how when you look closely, most of the >1% CuEq mineralization is restricted to narrow zones, that are hard to join together. there doesn't appear to be a solid, high-grade core, just a lot of narrow high-grade dykes surrounded by mineralization that would be marginal if exposed at surface, but at >500m depths, it will never be touched.

I'm a bit disappointed, and gut feel is that the actual resource will be significantly lower than what the market expects, as these high-grade zones aren't consistent and don;t appear to join up.

However, I invested in SolGold for the other targets, I knew that Alpala was deep and probably not good enough as a standalone deposit. I want to see them drill somewhere else.

If you want the full Leapfrog project - e-mail me at theangrygeologist@gmail.com and I'll upload it for you





Tuesday, October 3, 2017

AntaKori - the results continue.....

We got some more drill results from Regulus (link), you can download the Leapfrog viewer file here (link).

Summary:

  • Arsenic is controlled by the High-Sulfidation event, the skarn mineralization appears to contain significantly lower As.
  • Hole AK-17-002 was OK
    • Upper interval was similar to the 2012 resource grade (0.36 g/t Au and 0.48% Cu (link))
    • Lower interval - deep and low grade (less than 0.5% Cu Eq at ~400m vertical depth isn't special)
  • Hole DHSF17-160 - a very interesting hole, 
    • Decent, thick intercept of good grades, especially the lower Skarn mineralization
    • Hole located in corner of Regulus Concessions. This could mean the best mineralization is off their ground.
Here they are:

table 1

table 2


I applaud Regulus for including the second table, with Arsenic (As) assays. This is a project with "As issues", so why don't we look at the data a bit more closely.

If we split the assays by mineralization type - High Sulfidation (HS) and Skarn, we can see that the HS mineralization contains much more As than the Skarn.



parts per million (ppm) Arsenic
We see similar patterns with copper and gold.



The high sulfidation event is introducing additional metals into the system or re-mobilization them.

The good news, the Skarn contains significantly lower As content than the HS mineralization, but are lower grade.

So, if there is a big skarn at AntaKori, As shouldn't be a problem.

Drill-results

Let us look at the drilling data in more detail.

Hole AK-17-002

Overall, I was a bit disappointed in this hole. We can split the mineralization into 2 zones.

  1. Upper Zone - the High Sulfidation system - nothing special, average grade dragged up by a high-grade breccia, the rest of the zone was a bit underwhelming, especially as hole SDH-037 hit 188.55m @ 1.07 g/t Au and 2.02% Cu was only ~80m away.
  2. Lower Zone - the Skarn zone - generally a bit crap, it was poorly mineralized (less than 0.25% Cu) and deep. 
Au

Cu



Hole DHSF17-160

This was much more interesting. A good, thick, decent grade skarn drilled where no skarn has been drilled before....

Some nice thick >0.5% Cu with a nice gold bonus. the drill-holes around it didn't hit anything.

Au


Cu


There is very little historic drilling in this area, and it suggests that potentially the core of the skarn mineralization could be located between holes DHSF-17-160 and 161, but this is where we start to run into the boundary problem, it suggests that the core (best?) part of the system is located on Coimolache concessions...




So, it will be interesting to see the results from holes AK-17-003 and DHSF17-161




Tuesday, September 26, 2017

Assay results

How long does it take to get anassay result?

Some companies can take months to release assays. We all know that these companies want to release those juicy numbers as quickly as possible, but sometimes, those evil pricks at the assay labs decide to screw everything up and deliberately go slow on those critical samples from that critical drill-hole from that critical project.

I mean, a Junior Exploration company would NEVER sit on assay results, especially if they aren't inline with market expectations/promises.

I need to take you on a trip, image that you are a little gold flake (or silver for weirdos), you've been lucky and managed to find yourself in a vein. If you've been lucky, you've ended up in a nice, warm location.

You've been there for millions (or longer) of years, an then, some dick-head geologist, probably a JAFA, whips out his Estwing, beats you out of place and then tosses you into a fine Sentry sample bag.

So, how long do you think it will take for this sample to go from the field, get crushed, analysed and the results e-mailed back to the incredibly talented exploration geologist?

(Note: I'm ignoring samples sent to mine laboratories, they have this weird think called 24 hour turnaround, that is way to little time to create an impressive story of your geological prowess).

There are 3 aspects in the life of a sample:

  1. How long it takes to get  the sample from the field to the prep laboratory
  2. How long the Prep lab take to dry, crush, pulverize and sieve the sample to create a pulp
  3. How long it takes the pulp to arrive at the analytical lab and be analysed and the results sent to the company.
These factors vary by work rotation, project location, and location of the labs.

So, I've been going through some of my old data, and on average:

Peru - 28 days
From field to prep lab = 7 days
Prep = 3 days
Analysis - including over-limits - 18 days

Chile - 31 days

From field to prep lab = 8 days
Prep = 2 days
Analysis* - including over-limits - 21 days


Mexico - 25 days
From field to prep lab = 3 days
Preparation = 2 days
Analysis* = 14 days

*the pulp samples were sent overseas to Peru/Canada for 4 acid digest

These are AVERAGE turnaround times from hundreds of sample shipments. So, if we factor in a week or two for the geologists to import, process and interpret the results, you can see that 5-7 weeks is a good upper limit to wait for results to be announced.

So, if you are waiting >2 months for the results, maybe you should ask why......

Note: The samples form Chile and Peru were a combination of Core and surface (rock-chip, grab and soil samples). The Mexican samples were surface samples only.

Thursday, September 7, 2017

Mexican Hat - dodgy numbers?

GMV's Mexican Hat project, we saw earlier how they like to add together their separate intercepts to make their gold zones look bigger.

This project has had a history of getting companies into problems with the BCSC.

The first was Capital Hill Gold (link):

oops...











And then it was the turn of Auracle Resources (link) :

darn....














We are told that the resource defined by Placer is:










So the gold is found is discrete zones?



Rock-chip sample data





Outcrop photos


Brown rocks - contain gold; grey = no gold


Drill-hole Data


Gold in narrow, discrete zones..

Sections


So GMV have managed to increase the project resources by a small 244% from Placer's original "geological estimation" of ~154,000 ounces of gold to >500,000 ounces?

Official Mexican Hat Resources, GMV resources Feb 2016

They must have drilled a crap load of drill-holes. Here are all the historic holes.

Black = Placer Holes
Here are all the holes drilled by GMV, but please be careful, as you may be amazed at how they have swiss-cheesed El Sombrero. Here are the 2016 drill-holes.

so, 15 holes?
Looks to be 18 holes in 2011 and 15 holes in 2016, and a few holes this year, so I'm sure that they hit massive thickness of high-grade gold. I assume that they forgot to put them in the PRs?

So, we have gold in discrete, narrow zones. A massive increase in resources, but without a huge amount of drilling? How does that work?

I'm sure there is nothing suspicious, but just a couple of questions:

  • When will GMV release the results from the 3 holes completed in May (link)? We had a bit of text in the July 12th release (link), could be get a table?
  • How has the rest of the drilling going? You Told us that drilling started in July (link), so no holes have been completed and no results? When will we get to see the results?
    • RC rigs can easily drill 200m a day (so should be completing a couple of holes a week)
    • You have an assay lab in Tucson just 72 miles away, a 1.5 to 2 hour drive
    • Labs normally take 2-4 weeks to process and analyze samples
  • You also told us back in May that you completed the 1st diamond hole in the 2017 drill program. When will we see the results from this hole, it has only been 4 months.
You should have a good chunk of the results, did you get any huge intercepts like those in the Feb 2017 PR (link)


This project smells of BS, and the company have demonstrated that they are more than happy to massage results to present a small, crap project in the best light possible.

























Thursday, August 24, 2017

Ankakori - the first hole

DISCLOSURE: I should have bought more

What a whopper! A great first hole from Regulus at Antakori (link). They have been very intelligent and the initial drilling is focused at filling in the gaps left by [insert name here].

You can download the 3D model from here (link) - please not that this file is big, I've included the topography and overlain the property boundary and some geophysics in the 2006 technical report.

Summary

  • Antakori is a complicated multi-phase mineral system. dominated by:
    • High-sulfidation Epithermal - Au, Ag, Cu and As rich
      • this is what is mined by the neighbors to the SW
    • Skarn/porphyry mineralization - Cu +/- Zn, Ag, Pb rich
  • Great first hole, plugged into a nice high grade zone identified back in 20XX
  • Mineralization is Epithermal (high-sulfidation) - hole will be Enargite (Cu-Au and As) rich
  • AK-17-001 didn't go deep enough to test the skarn/porphyry potential, but hole AK-17-002 will!
Hole AK-17-001, 002 and 003 have been drilled along the SW margin of the property, where it butts up against the Tantahuatay Mine.

my annotations - is that mag low to the north a porphyry?
 Hole AK-17-001 went smack between historic holes SDH-034 (120m @ 0.63 g/t Au and 0.67% Cu) and SDH-037 (188m @ 1.07 g/t Au and 2.02% Cu) drilled in 2012, and demonstrate that this zone appears to be quite high-grade and robust.

here is a cross section

pink = HS-epithermal domain; blue = skarn domain
You can see where hole AK-17-001 has hit, the copper grades are very good, but the gold is restricted to a narrow (23m core length or ~ 10m true width) zone grading ~ 7 g/t Au with a lower grade halo, suggesting that there could be some high-grade veins in the core of that hit.

And a long section with some distances on it.




Why don't we take a bit of time to look at the Antakori property. To steal a football pun, it is a project of 2 halves:

  1. High-sulfidation Epithermal deposit
  2. Skarn-porphyry deposit



HS-Epithermal Mineralization

This is what they are mining next door and looks like this:

Dickite, hehehe


The enargite is the issue here, it contains arsenic, and historically this project is regarded as having an arsenic issue. It does, but it is local, and it will be a problem for the neighbors if (when?) they start expanding the open pit into this area (with a nice NSR to Regulus is they do!).

The Skarn-porphyry mineralization

Simple formation model - Porphyry + limestone = skarn

Peru has a few big 'uns (Antamina, Las Bambas, Tintaya etc.) that produce a lot of metal. The historic drilling has hit some skarn, but it hasn't been drilled systematically, and this is where a lot of potential for AK is. I was a bit disappointed that hole AK-17-001 didn't go deep enough, but a minor grumble.

It looks like this:

doesn't look impressive, but can be big!

However, hole AK-17-002 should be going a lot deeper properly looking at the skarn potential at Antakori, and is the hole I'm interested in!

So, early days, but it is good to start the 2017 drilling with a nice hot hole. A bit of a cheat (focusing on infilling a known high-grade zone, but might as well test the lowest risk targets to get the juices going.
However, I have a few questions:

  • How much input do Regulus have in this drilling campaign, are they restricted by their partners?
  • Do they have permitting to explore the entirety of the project or are they restricted to specific areas?
  • Why are they drilling that gold project in the US?
This is going to be an interesting, developing story, I'm happy with the first results and would like to see some evidence of regional exploration (cheap, low-end stuff), and maybe some geophysics to see if there are other decent targets in the area.