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Xanadu chases Mongolian copper-gold resource jump

Updated: Apr 23


Xanadu Mines’ Kharmagtai camp site in the South Gobi Desert of Mongolia. Credit: File

Xanadu Mines is pushing to enhance the current resource at its Kharmagtai project in Mongolia after a new zone of high-grade copper-gold emerged from infill drilling at the company’s White Hill deposit.


Management has four diamond drill rigs focused on infill drilling at the operation, with 27,000m of a planned 30,000m campaign completed at its Stockwork Hill and White Hill deposits.


Kharmagtai already hosts an impressive mineral resource estimate of 1.1 billion tonnes for 3 million tonnes of contained copper and 8 million ounces of gold, with the newly-identified core at White Hill showing the potential for an upgrade.


Drilling highlights from Xanadu’s latest assays show a massive 544m interval at 0.40 per cent copper equivalent from 273.4m that includes a 63m hit grading 1.03 per cent copper and 0.23 grams per tonne gold from 634m, including 28m going 1.61 per cent copper and 0.32g/t gold from 645m.


A second hole at White Hill recorded 654.5m reading 0.34 per cent copper equivalent from 172m, including an 8m section at 0.63 per cent copper and 0.29g/t gold from 494m, in addition to a deeper high-grade hit of 8m going 1.17 per cent copper and 0.5g/t gold from 651m.


The company says its recent assays show results equal to or better than the grades used in 2021 to define its current resource.


Both drill holes KHDDH638 and KHDDH634 have effectively intercepted the top of a previously undefined high-grade core at White Hill. Both Stockwork Hill and Copper Hill deposits feature these higher-grade zones (core), and previous drilling at White Hill has suggested such a zone may be present there also. However, this is the first time we have observed significant intervals spanning greater than 50m of mineralisation at grades greater than 1% eCu at White Hill. Xanadu Mines chairman and managing director Colin Moorhead

Assay results from Stockwork Hill released last month show a 294m intercept grading 0.32 per cent copper and 0.26g/t gold from 122m, including a 12m section going 0.77 per cent copper and 1.82g/t gold from 145m and a deeper 34m hit at 1.1 per cent copper and 0.1g/t gold from 285m. Another hole at the deposit recorded 22m at 0.95 per cent copper from 411m, including 4.1m reading a solid 3.82 per cent copper.


Based on Xanadu’s scoping study predictions for the first five years of production, Kharmagtai shows a diminutive strip ratio of just 0.9 to 1 and an average milled copper grade of 0.29 per cent. The company expects to produce an annual average of 37,000 tonnes of copper.


Earlier this year, the company completed two phases of its strategic partnership with Chinese copper giant Zijin Mining, giving it access to funding for its current round of exploration.


The deal saw Zijin invest US$35 million (AU$52 million), funds which will also be used to complete the Kharmagtai prefeasibility study. A 50-50 joint venture has been created between the two partners at a project level, with Xanadu the operator on the ground.


The partnership has allocated 18 months to knock over its PFS, while an earlier scoping study identified several upside opportunities that could materially upgrade the economics of the project.


Xanadu says that given the success of its ongoing infill campaign, the company has earmarked both the Stockwork Hill and White Hill deposits for potential follow-up drilling to test for further extensions.


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