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Xanadu nails early copper-gold recovery rates in Mongolia

Updated: Apr 23

Xanadu Mines has recorded promising early results from metallurgical testing at its Kharmagtai copper-gold project in Mongolia. Credit: File

Xanadu Mines (ASX: XAM) says it has recorded early metallurgical recoveries of up to 98 per cent copper and 95 per cent gold from rougher flotation testwork on ore from its Kharmagtai project in Mongolia.

Management says the results are in line with or better than previous scoping study assumptions and show a potential value uplift in final prefeasibility study (PFS) recoveries. Cleaner recovery and oxide leach testing is already underway, with results expected before the end of the financial year.

The test program was conducted at the ALS laboratory in Perth and included head grade analysis and rougher flotation recovery testwork on 26 samples taken from core drilled at Xanadu’s Stockwork Hill, White Hill and Copper Hill deposits at the project. The results were recorded at head grades of up to 1.6 per cent copper and 2 grams per tonne gold.

Last year, the company completed two phases of its strategic partnership with China’s giant Zinjin Mining Group, providing access to funding for its recent exploration blitz at the operation. The deal saw Zijin invest US$35 million (AU$52 million), which will also be used to complete the Kharmagtai PFS.

A 50:50 joint venture (JV) has been created between the two partners at a project level, with Xanadu to be the operator on the ground. The partnership has allocated 18 months to knock over the PFS, which is expected to be completed this year, while an earlier scoping study identified several upside opportunities that could materially upgrade the economics of the project.

Strong sulphide rougher flotation results were expected given the clean mineralogy of the deposits at Kharmagtai, and it is very pleasing to have this confirmed here. These results are only part of our metallurgical test plan, and we look forward to future announcements including cleaner flotation and an even larger potential value uplift from our oxide leach program being investigated by MPS labs in Perth.
Xanadu Mines chairman and managing director Colin Moorhead

In December, the company tabled a staggering resource estimate upgrade for Kharmagtai, jumping to 1.3 billion tonnes with 3.4 million tonnes of contained copper and 8.5 million gold ounces. The updated estimate represents a 12 per cent increase in tonnes, a 15 per cent surge in contained copper and a 9 per cent jump in contained gold.

Xanadu also has a 100 per cent share in its Red Mountain project in southern Mongolia where early exploration has defined broad zones of strong quartz stockwork, veining and associated high-grade gold mineralisation of about 0.5g/t gold to more than 5g/t and 0.3 per cent to 1.5 per cent copper.

Xanadu says Mongolia hosts significant, large-scale mining operations with two world-class mines to the south – the Oyu Tolgoi copper-gold project and the Tavan Tolgoi coking coal operation. The region offers ideal infrastructure to be able to deliver product next door to the world’s biggest copper and gold consumer, China.

In January, the company entered into a binding term sheet to earn up to 80 per cent of the Sant Tolgoi project in Mongolia that hosts multiple shallow copper-nickel targets through several kilometres of strike.

Management says Sant Tolgoi includes many advanced exploration targets and presents a real opportunity for the discovery of magmatic copper and nickel mineralisation. It says there are signs of several systems in both historical and recent drilling.

With funding security from its Zijin deal, a massive mineral resource and significant early results from metallurgical testwork, Xanadu is looking on track with its aim to become the next producing copper-gold operation in Mongolia.

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