Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX:
MND, OTCQB: MNDJF) is pleased to provide an update on drilling
progress at its Costerfield operation in Victoria, Australia.
Further diamond drilling underneath the Youle
orebody has resolved the Shepherd Zone into five distinct veins.
These veins are grouped into the Eastern and Western horizons veins
as described within the previous Shepherd Zone update (see June 8,
2021, press release). The Eastern veining group has been extended
to the south and can be traced over 400 m of strike, and
approximately 100 m of vertical extent. The Shepherd system still
remains open to the north, south and at depth with the southernmost
drillhole showing persistent veining with significant gold and
antimony grade.
The Costerfield Deeps program has progressed
with another drillhole completed since the last update in 2020.
Drillhole CD002 and wedge hole CD002W1 were drilled under the
Cuffley and Augusta deposits and recovered quartz veining with
multiple visible gold intercepts within horizons not previously
encountered. The discovery of additional gold-bearing veins
down-dip of the Augusta Mine builds on previously reported
high-grade intercepts of the Sub-King Cobra deep drilling program
and lends weight to the Company’s expectation of a sizeable system
of significantly mineralized gold-bearing veins at depth below the
current development.
New Drilling Highlights:
Eastern Vein Group
- 399.0 g/t gold over true width of 0.11 m in
KD773;
- 61.8 g/t gold over true width of 1.66 m in
BC214;
- 24.6 g/t gold and 2.3% antimony over true width of 1.19
m in BC218A;
- 10.0 g/t gold and 2.3% antimony composited over true
width 8.2 m in BC239 including:
- 98.6 g/t gold and 18.5% antimony over true width of 0.31
m;
- 2.4 g/t gold and 1.7% antimony over true width of 0.74 m;
- 19.8 g/t gold and 8.3% antimony over true width of 0.26 m;
- 156.0 g/t gold and 19.1% antimony over true width of 0.17 m;
and
- 14.8 g/t gold and 11.6% antimony over true width of
1.76 m in BC241
Western Vein Group
- 155.0 g/t gold and 10.5 % antimony over true width of
0.11 m in BC234; and
- 66.6 g/t gold over true width of 0.25 m in
BC220
Note: Further intercept details including
significant intercepts within composite intervals can be found in
Table 1 in the Appendix to this document.
Dominic Duffy, President and CEO of Mandalay,
commented: “Despite a redirection of resources to other near-mine
targets while appropriate drilling platforms were established, the
drilling and interpretive work on Shepherd yielded excellent
results. Mandalay is very encouraged by the 150 m extension of
veining, which also includes one of the largest intercepts within
the system discovered to-date. As the resolution of data increased,
our understanding evolved around what was previously understood as
two veining horizons, which are now interpreted to be five distinct
veins.”
Mr. Duffy continued, “Further to the increased
veining and strike extension, the southern extension veins show
increased amounts of antimony alongside the gold bearing quartz
veins. Antimony is currently produced as a co-product with gold and
is considered a critical mineral by the Australia government. This
southern zone is rich in antimony and is still open to the south
and at depth with the upper vertical constraint (interaction with
Youle) rising as the vein progresses to the south.”
Mr. Duffy continued, “In conjunction with the
Shepherd drilling campaign, the ongoing Costerfield Deeps project
progressed further with two deep holes underneath the
multi-million-ounce Costerfield corridor. Excitingly, CD002 –
drilled underneath the Cuffley deposit – intercepted two instances
of visible gold within quartz veining at 998 m and 1,169 m
down-hole. This result taken along-side the initial high-grade
intercepts drilled in 2016, indicated that the system at depth (900
m below surface) is 500 m wide.”
Mr Duffy concluded, “Both the incremental steps
taken with the discovery of Shepherd and the step-out drilling
conducted within the Costerfield Deeps program is providing a
strong foundation for future growth at Costerfield, which is
currently one of the world’s highest grade gold mines and
Australia’s highest-grade antimony mine.
“A video has been prepared by Mr. Chris Davis,
Vice President of Operational Geology and Exploration, to further
explain the information in this release. The video can be found on
Mandalay’s website or by clicking here.”
The Shepherd Zone Extension and Infill
Since Mandalay’s last press release on the
Shepherd zone drilling (June 8, 2021), an additional 27 holes have
been drilled into Shepherd. From this drilling, 62 significant
intercepts have been sampled.
This latest round of drilling focussed on
building confidence in the northern and central portions of
Shepherd and extending the veining to the south. As continued
drilling and interpretation has refined the Shepherd model; the
previously interpreted Eastern and Western Shepherd veins have been
further defined into an array of two veins (named Shepherd and
Merino) grouped as the “Eastern Veining” and three veins (named
Suffolk, Dorper and Southdown) grouped as the “Western Veining”
(Figure 1).
The lateral and vertical extents of the Shepherd
zone veining is still not fully understood, as the southernmost
drilling shows the system is still within high grade. The new
interpretation of three veins continuing northward has demonstrated
that the northernmost drilling has not adequately tested the
veining. Mineralization at depth has been intercepted, however the
drill angles offered by existing infrastructure becomes acute at
depth. As such drilling to-date has been focused on lateral
extension with depth extension scheduled from drill horizons not
yet developed.
Figure 1. Inclined plan section of the Shepherd
vein system as currently interpreted, showing the positions of the
intercepts highlighted in this
release.https://www.globenewswire.com/NewsRoom/AttachmentNg/8711fe30-75a7-4be2-bb1b-e6fe3c2fa1a7
Eastern Veining
Approximately 150 m of strike has been added to
the south of the Shepherd vein, through intercepts obtained in
drillholes BC234, BC239, BC240 and BC241. Excitingly, alongside the
gold in quartz, veining is ubiquitous to the northern and central
portions of Shepherd, and the drilling shows strong and rich
stibnite (antimony ore) veining. This mineralization is
demonstrated in BC239 which intercepted 10.0 g/t gold and 2.3%
antimony over a true width of 8.2 m including 98.6 g/t gold and
18.6% antimony over 0.31 m and 156.0 g/t gold and 19.1% antimony
over 0.17 m. The southernmost intercept (BC240: 40.1 g/t Au and
13.5% Sb over true width of 0.30 m) still shows strong gold and
antimony present. Approximately 50 m above the southernmost BC240
is the intercept of BC241, which again shows high grade veining
with a composite of 14.8 g/t gold and 11.6% antimony over a true
width of 1.76 m (Figures 2 and 3).
Figure 2. Picture of the drill core recovered in
BC241 of the Shepherd intercept. Down hole lengths and grades are
shown in red. The light grey or metallic mineral is
stibnite.https://www.globenewswire.com/NewsRoom/AttachmentNg/c3cf9a56-c779-4aed-bdc6-487dea06ecce
The two newly defined veins of the “Eastern
Array” have differing orientations with the Shepherd shallow
dipping (75°) to the west in contrast to the sub vertical (85°)
Merino vein. This variance in orientation causes a convergence of
the structures and a localized upgrading along the north plunging
interaction. A key finding from the most recent iteration of
modelling is that the Shepherd vein is likely the structural and
mineralized continuation of the Youle orebody only in a steeper
orientation (Figure 1).
Figure 3. Longitudinal section of the Shepherd Zone Eastern Vein
Group (600, 605
veins)https://www.globenewswire.com/NewsRoom/AttachmentNg/08d2b5dd-b590-4842-9cbd-8e13dca3be53
Western Veining
Since the last update, the “Western Vein” has
been resolved into three distinct veins (Suffolk, Dorper and
Southdown). Drilling since the June release intercepted the Suffolk
and Southdown veins only. Many of the holes targeting the Western
veining in this reporting period were designed to infill large gaps
identified as interpretation progressed, and to extend these veins
down-dip. The Western veins to the North (Suffolk, Dorper) continue
to be dominated by gold-only mineralization, with stibnite often
undetected in these intercepts, such as BC220 (66.6 g/t gold over a
true width of 0.25 m) on Suffolk vein. The southern Southdown vein
shows both antimony and gold mineralization as intercepted in
drillhole BC234 (155 g/t Au and 10.5% Sb over a true width of 0.11
m). Current interpretation shows a change in strike between the
Suffolk and Southdown veins, and further infill drilling (between
6990 and 7040m) is planned to understand the strike change along
with the mineralization style from gold in quartz in the Suffolk
vein to the more stibnite and quartz with visible gold seen in the
Southdown vein.
Figure 4. Longitudinal section of the Shepherd Zone Western Vein
Grouphttps://www.globenewswire.com/NewsRoom/AttachmentNg/888feb0a-75c1-4531-b8c9-9422d6f5be07
Infill drilling, as well as extensional drilling
of Shepherd zone is ongoing with current programs due to see out
the remainder of this year. Additionally, drilling at depth will
again become a focus when further drilling horizons become
available as the decline progresses towards Shepherd.
Costerfield Deep Drilling
The Costerfield Deeps drilling program has been
designed to follow on from the exciting deep drilling program
started in 2015, which has resulted in many previously reported
high-grade intercepts (described below). With the continued success
at Cuffley, Brunswick and now Youle, Costerfield Deeps became a
lower priority until further litho-stratigraphic analysis (sparked
by the success of the neighbouring Fosterville mine) gave context
to the high gold grade results and the prospect of a significantly
larger target. Generally, the favourable setting sits at a depth of
0.8 to 1.2 km, so the current program to date has involved long
drill holes with wedges from those holes. Drillhole CD001
underneath Southern Youle was reported in 2020. Below is a summary
of the second hole in the series CD002 and wedge targeting at depth
to the south of the field.
Completed on July 30, 2021, drillhole CD002 was
drilled to a depth of 1,497 m and designed to test at depth below
the Cuffley and Augusta ore systems, down-dip of an area where
high-grade gold mineralization has been encountered in 2016’s Sub
King Cobra drilling campaign. The deepest significant results from
this program are:
- CSK007 – 47.5 g/t gold over a true width of 2.37 m (reported
January 19, 2016). Including 1,361 g/t gold over a true width of
0.08 m; and
- CSK012 – 344.7 g/t gold over a true width of 0.19 m (reported
July 25, 2016)
Geological modelling of this area, which
involved the integration of litho-stratigraphic and structural
information obtained from the 2019’s CD001 drillhole, inferred the
existence of a broad anticline dissected by the down-dip extension
of the west-dipping thrust faults that bound the currently mined
orebodies, hosting the same package of carbonaceous sandstones
targeted and encountered in CD001. The geochemical and rheological
contrast of these sandstones with the siltstone-dominated
lithologies of the Costerfield area were suggested as a favourable
environment for mineralization.
Figure 5. Cross section of Costerfield Deeps hole CD002, showing
the position of the mineralised veins encountered in relation to
the Brunswick and Cuffley / Augusta
mines.https://www.globenewswire.com/NewsRoom/AttachmentNg/db5e9251-c0b2-4aee-9f37-69c2bcfd5d59
CD002 found the interpreted anticline to be
present (Figure 5), and encountered two significantly mineralized
veins, both displaying visible gold:
- From 998.7 m – 0.7 g/t gold over a true width of 0.12 m;
and
- From 1,169 m – 7.9 g/t gold over a true width of 0.07 m.
The lower grade assay result of the first vein
(at 999 m downhole) was a subvertical east dipping vein, that is
atypical of veins containing visible gold at Costerfield and
highlights the significant “nugget effect’’ active during assay of
coarse gold material. This effect is mitigated in the Shepherd zone
by assaying the whole diamond drill core. The Costerfield Deeps
drill core is sawn in half before sampling, the other half retained
for archiving. Wedging was conducted to twin the mineralized
intercepts and increase the confidence of geological interpretation
around these zones. The assay results of these wedges are reported
in this release’s Appendix.
Figure 6. Photomicrograph of gold within veining at 998.7 m of
CD002.https://www.globenewswire.com/NewsRoom/AttachmentNg/f71cf22d-4295-4244-b1ad-5c6b75fc67f8
These mineralized intercepts continue the
at-depth prospectivity first identified with Sub-King Cobra
drillholes CSK007 and CSK012, hinting at the potential for economic
panels of mineralization to exist between the Adder and Blue-Ringed
Faults down-dip of the existing mine. With the new information
obtained from CD002, this mineralized corridor is now at least 500
m wide and of unknown strike extent. This area will continue to be
targeted for further drilling in 2022.
Drilling and Assaying
All underground drilling reported in this
document was completed using 2 x LM90 and 1 x LM30 Boart Longyear
diamond drill rigs operated by drill contractor Starwest Pty Ltd.
Surface drilling was completed using a Boart Longyear LM90 diamond
rig. All diamond drill core was logged and sampled by Costerfield
geologists. All samples were sent to On Site Laboratory Services
(OSLS) in Bendigo, Victoria, Australia, for sample preparation and
analysis by fire assay for gold, and Atomic Absorption Spectroscopy
(AAS) for antimony. Samples featuring coarse grained visible gold
were assayed using a variant of fire assay known as screen fire
assay. This method is routinely used to mitigate potential problems
associated with heterogeneity in the distribution of coarse gold
within drill samples. The procedure collects all heterogenous
coarse gold by screening at 75µm after crushing and pulverisation,
and subsequently fire assays the full resultant +75µm mass to
extinction. A mass weighted average of gold grade of the sample is
subsequently calculated from the +75µm fraction and 3 x splits of
the -75µm fraction of the sample. Site geological and metallurgical
personnel have implemented a QA/QC procedure that includes
systematic submission of standard reference materials and blanks
within batches of drill and face samples submitted for assay.
Costerfield specific reference materials produced from Costerfield
ore have been prepared and certified by Geostats Pty Ltd., a
specialist laboratory quality control consultancy. See Technical
Report entitled “Mandalay Resources - Costerfield Operation NI
43-101 Report” dated March 30, 2021, available on SEDAR
(www.sedar.com) for a complete description of drilling, sampling,
and assaying procedures.
Qualified Person:
Chris Davis, Vice President of Operational
Geology and Exploration at Mandalay Resources, is a Chartered
Professional of the Australasian Institute of Mining and Metallurgy
(MAusIMM CP(Geo)), and a Qualified Person as defined by NI 43-101.
He has reviewed and approved the technical and scientific
information provided in this release.
For Further Information
Dominic DuffyPresident and Chief Executive Officer
Edison NguyenManager, Analytics and Investor Relations
Contact:647.260.1566
About Mandalay Resources Corporation
Mandalay Resources is a Canadian-based natural
resource company with producing assets in Australia (Costerfield
gold-antimony mine) and Sweden (Björkdal gold mine), with projects
in Chile and Canada under care and maintenance, closure or
development status. The Company is focused on growing its
production profile and reducing costs to generate significant
positive cashflow.
Mandalay’s mission is to create shareholder
value through the profitable operation of both its Costerfield and
Björkdal mines. Currently, the Company’s main objective is to
continue mining the high-grade Youle vein at Costerfield, which
continues to supply high-grade ore, and also focus on extending
Youle’s Mineral Reserves at depth. At Björkdal, the Company will
aim to increase production from the Aurora zone in the coming
years, in order to maximize profit margins from the mine.
Forward-Looking Statements:
This news release contains "forward-looking
statements" within the meaning of applicable securities laws,
including statements regarding the exploration and development
potential of the Youle deposit (Costerfield). Readers are cautioned
not to place undue reliance on forward-looking statements. Actual
results and developments may differ materially from those
contemplated by these statements depending on, among other things,
changes in commodity prices and general market and economic
conditions. The factors identified above are not intended to
represent a complete list of the factors that could affect
Mandalay. A description of additional risks that could result in
actual results and developments differing from those contemplated
by forward-looking statements in this news release can be found
under the heading “Risk Factors” in Mandalay’s annual information
form dated March 31, 2021, a copy of which is available under
Mandalay’s profile at www.sedar.com. In addition, there can be no
assurance that any inferred resources that are discovered as a
result of additional drilling will ever be upgraded to proven or
probable reserves. Although Mandalay has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements.
Appendix
Table 1. Shepherd Drilling Composites
DRILL HOLE ID |
FROM (M) |
TO (M) |
DRILL WIDTH (M) |
TRUE WIDTH (M) |
AU GRADE (G/T) |
SB GRADE (%) |
AU (G/T) OVER MIN. 1.8M MINING WIDTH |
VEIN NAME |
BC214 |
58.38 |
60.96 |
2.58 |
1.66 |
61.8 |
0.1 |
57.1 |
Merino |
BC216 |
156.09 |
156.68 |
0.59 |
0.20 |
3.0 |
LLD |
0.3 |
Merino |
BC217 |
151.00 |
152.32 |
1.44 |
0.65 |
20.1 |
LLD |
7.3 |
Merino |
including |
151.98 |
152.32 |
0.34 |
0.12 |
84.2 |
LLD |
5.6 |
Merino |
BC220 |
129.44 |
129.79 |
0.35 |
0.29 |
4.0 |
0.1 |
0.7 |
Merino |
BC221 |
121.61 |
121.96 |
0.35 |
0.15 |
95.5 |
16.9 |
11.2 |
Merino |
BC222 |
121.85 |
122.36 |
0.51 |
0.12 |
65.7 |
6.6 |
5.4 |
Merino |
BC225 |
163.85 |
166.37 |
2.52 |
1.34 |
0.1 |
LLD |
0.1 |
Merino |
BC227 |
102.68 |
105.90 |
3.22 |
2.07 |
1.6 |
LLD |
1.6 |
Merino |
BC228A |
99.95 |
100.31 |
0.36 |
0.17 |
74.4 |
0.0 |
7.0 |
Merino |
BC231 |
90.02 |
90.94 |
0.92 |
0.74 |
22.0 |
LLD |
9.0 |
Merino |
BC232 |
105.84 |
106.68 |
0.84 |
0.45 |
16.4 |
0.0 |
4.1 |
Merino |
KD774 |
134.00 |
134.24 |
0.24 |
0.13 |
0.4 |
0.0 |
0.0 |
Merino |
BC214 |
56.00 |
58.38 |
2.38 |
0.66 |
14.8 |
0.5 |
5.9 |
Shepherd |
BC215 |
119.15 |
119.35 |
0.20 |
0.05 |
0.5 |
0.0 |
0.0 |
Shepherd |
BC218A |
173.00 |
174.93 |
1.93 |
1.19 |
24.6 |
2.3 |
19.8 |
Shepherd |
including |
174.24 |
174.93 |
0.69 |
0.47 |
66.7 |
6.5 |
21.3 |
Shepherd |
BC225 |
172.17 |
172.77 |
0.60 |
0.39 |
7.6 |
LLD |
1.7 |
Shepherd |
BC227 |
114.96 |
115.55 |
0.59 |
0.30 |
14.9 |
LLD |
2.5 |
Shepherd |
BC228A |
125.96 |
126.60 |
0.64 |
0.25 |
0.9 |
0.0 |
0.1 |
Shepherd |
BC230 |
103.70 |
104.04 |
0.34 |
0.26 |
0.4 |
LLD |
0.1 |
Shepherd |
BC232 |
114.66 |
115.16 |
0.50 |
0.23 |
114.0 |
0.0 |
14.6 |
Shepherd |
BC233 |
141.50 |
142.10 |
0.60 |
0.27 |
2.1 |
LLD |
0.3 |
Shepherd |
BC234 |
265.45 |
268.44 |
2.99 |
1.02 |
12.3 |
6.5 |
15.5 |
Shepherd |
BC237 |
142.93 |
143.56 |
0.63 |
0.22 |
91.2 |
0.0 |
11.2 |
Shepherd |
BC239 |
270.66 |
286.15 |
15.49 |
8.23 |
10.0 |
2.3 |
15.4 |
Shepherd |
Including |
270.66 |
271.40 |
0.74 |
0.31 |
98.6 |
18.5 |
24.4 |
Shepherd |
Including |
276.16 |
277.15 |
0.99 |
0.26 |
19.8 |
8.3 |
5.6 |
Shepherd |
Including |
285.83 |
286.15 |
0.32 |
0.17 |
156.0 |
19.1 |
18.9 |
Shepherd |
Including |
271.40 |
276.16 |
4.76 |
0.74 |
2.4 |
1.7 |
2.6 |
Shepherd |
BC240 |
328.10 |
328.55 |
0.45 |
0.30 |
40.1 |
13.5 |
11.9 |
Shepherd |
BC241 |
127.70 |
130.84 |
3.14 |
1.76 |
14.8 |
11.6 |
40.7 |
Shepherd |
KD773 |
93.06 |
93.18 |
0.12 |
0.11 |
399.0 |
0.1 |
24.4 |
Shepherd |
KD774 |
136.25 |
137.47 |
1.22 |
0.73 |
31.9 |
0.0 |
13.0 |
Shepherd |
BC218A |
267.73 |
268.27 |
0.35 |
0.22 |
23.2 |
6.1 |
4.6 |
Southdown |
BC234 |
349.98 |
350.13 |
0.15 |
0.11 |
155.0 |
10.5 |
11.0 |
Southdown |
BC214 |
103.08 |
103.23 |
0.15 |
0.10 |
0.3 |
LLD |
0.0 |
Suffolk |
BC215 |
146.68 |
149.05 |
2.37 |
1.46 |
0.2 |
LLD |
0.2 |
Suffolk |
BC220 |
102.96 |
103.24 |
0.28 |
0.25 |
66.6 |
0.0 |
9.3 |
Suffolk |
BC221 |
213.79 |
213.95 |
0.16 |
0.10 |
0.1 |
0.0 |
0.0 |
Suffolk |
BC222 |
218.84 |
219.00 |
0.16 |
0.10 |
58.4 |
0.0 |
3.2 |
Suffolk |
BC228 |
117.70 |
118.70 |
1.00 |
0.31 |
21.5 |
LLD |
3.7 |
Suffolk |
BC229 |
124.70 |
124.91 |
0.21 |
0.11 |
0.0 |
LLD |
0.0 |
Suffolk |
BC232 |
161.87 |
162.24 |
0.37 |
0.14 |
3.6 |
LLD |
0.3 |
Suffolk |
BC235 |
129.60 |
130.13 |
0.53 |
0.37 |
0.4 |
LLD |
0.1 |
Suffolk |
BC215 |
128.47 |
129.90 |
1.43 |
1.01 |
1.8 |
LLD |
1.0 |
Unnamed |
BC222 |
110.41 |
110.70 |
0.29 |
0.19 |
19.8 |
LLD |
2.1 |
Unnamed |
Notes1. The AuEq (gold equivalent)
grade is calculated using the following formula:
AuEq g per t = Au g per t + Sb% × (Sb price
per 10kg × Sb processing recovery) / (Au price per g × Au
processing recovery)
Prices and recoveries used: Au
$/oz = 1,760; Sb $/t = 12,800; Au Recovery = 93% and; Sb Recovery =
95%
2. LLD signifies an undetectable
amount of antimony. Detection limit for the analysis used is
0.01%
3. Composites that are not
interpreted to be connected to a named vein and are below 1 g/t
AuEq when diluted to 1.8m are not considered significant and are
not recorded here.
Table 2. Costerfield Deep
Drilling Composites
Drill Hole ID |
From (m) |
To (m) |
Drill Width (m) |
True Width (m) |
Au Grade (g/t) |
Vein name |
CD002 |
988.67 |
989.13 |
0.46 |
0.08 |
0.8 |
|
CD002 |
998.67 |
999.13 |
0.46 |
0.12 |
0.7 |
Upper
vein |
CD002 |
1169.24 |
1169.5 |
0.26 |
0.07 |
7.9 |
Lower
vein |
CD002W1 |
1034.83 |
1035.09 |
0.26 |
0.06 |
1.0 |
|
CD002W1 |
1046.95 |
1047.65 |
0.70 |
0.16 |
0.7 |
Lower
vein |
CD002W1 |
1211.33 |
1212.33 |
1.00 |
0.42 |
0.5 |
|
CD002W2 |
997.6 |
998.13 |
0.53 |
0.13 |
2.4 |
Upper
vein |
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