Flagship Minerals eyes big resource boost from old Chilean gold dataset

High-grade hits from the outcropping Rosamaria quartz vein, pulled from Flagship Minerals’ newly acquired Pantanillo dataset in northern Chile, have handed the company plenty to chew on.

Flagship Minerals (ASX: FLG) has tapped into a treasure trove of gold at its Pantanillo project in Chile’s legendary Maricunga belt, with a reawakened dataset now peeling back the true scale of the deposit.

The company says the ongoing review of old results at the 1.05-million-ounce foreign estimate project has uncovered a string of drill holes that finish in gold mineralisation, along with several newly identified juicy, shallow high-grade zones.

The fresh data points to a 500-metre-wide mineralised corridor packed with thick intercepts, many of which are still open at depth, suggesting this golden monster may only just be waking up.

The massive 32GB dataset, which was recently acquired from Anglo American, has already uncovered several stunners. One hole returned a whopping 142m grading 0.74 grams per tonne (g/t) gold from just 58m and ending in mineralisation, while another registered 192.6m running at 0.63g/t starting from only 4m downhole.

Intriguingly, many of the holes punched straight through mineralisation and kept going, hinting at a significantly bigger gold orebody at depth, which has yet to be fully chased up. For example, a third hole coughed up 189m grading 0.56g/t gold from 54m, ending in mineralisation, while a fourth delivered 174m going at 0.54g/t from 76m, including a final 14m section grading 1.19g/t right at the bottom of the hole.

In addition to the broad hits, Flagship has also sniffed out shallower, higher-grade zones with some silver in the mix.

One standout hole ripped through 10m at 2.9g/t gold and 16g/t silver from just 35m, including a blistering 6m hit at 4.71g/t gold and 26g/t silver. Another nearby hole lit up with 3m at 4.09g/t gold and 21g/t silver from 37m.

The company believes these hits sliced into the Rosamaria quartz vein, which has been mapped for more than 400m at surface and is still wide open both down-dip and along strike to the west.

The higher grade zones are generally open at depth, providing attractive drill targets for down dip extensions, particularly in the central to eastern portions of the mineralised zone where we are seeing silver in association with higher grade gold. There is potential for the discovery of significant mineral resources in the central to eastern portions of the mineralised zone.

Flagship Minerals Managing Director Paul Lock

Flagship’s priority is to convert its existing foreign estimate into a formal JORC-compliant resource. The company also believes it can materially boost the tonnage and grade with minimal new drilling by integrating an additional 21 holes and reinterpreting the extensive historical dataset.

Much of the information acquired in the dataset was generated by heavyweight predecessors such as Anglo American, Kinross Gold and Orosur Mining. In total, the drill hole database consists of 183 holes for 30,370m of drilling and nearly 19,000 assayed samples.

Flagship has also pocketed a hefty 14,000m of diamond drill core, along with pulps and rejects, meticulously stored by Anglo in Copiapó and now ready for fresh assays.

The entire data library cost the company just under $3 million, which is a fraction of the estimated $30 million and five years it would have taken to drill Pantanillo from the ground up and hands the company a significant head start at the project.

Once a JORC-compliant resource has been posted, the company says it will get to work on development scenarios based on open-pit mining.

Metallurgical test work has already shown good recoveries, and the bulk of the mineralisation is oxide or mixed oxide-sulphide. This is perfect feedstock for low-cost heap leaching and could deliver an annual production profile of 100,000 ounces of gold over a 10-year mine life.

On a broader scale, Pantanillo sits smack in the middle of Chile’s Maricunga gold belt - a district already dripping with more than 65 million ounces of the yellow metal. The neighbourhood is stacked with giants, including Newmont-Barrick’s jaw-dropping 27-million-ounce Norte Abierto deposit, just 40 kilometres southwest.

Boosting the region’s credentials, Kinross’ 10.7-million-ounce Maricunga project lies 25km west of Pantanillo, while Hochschild Mining’s 11-million-ounce Volcan deposit is virtually next door at 10km northwest.

With a growing vault of historical data, multiple high-impact drill targets and a clear development vision, Flagship could be on the verge of rewriting the script at Pantanillo by turning a dusty Chilean legacy into the Maricunga belt’s next major gold play.

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