Dec 3 2014
Kaizen Discovery Inc. announced today that it would begin a diamond-drilling program at the Fairholme copper-gold project in central New South Wales, Australia, early this month. The 2,300-metre drill program is designed to test several induced polarization (IP) chargeability anomalies generated by a Typhoon three-dimensional IP survey completed by High Power Exploration (HPX) between June and August 2014.
"This will be the first significant test ever conducted on the large area that hosts the chargeability cluster, which never has been the focus of deep drilling," said B. Matthew Hornor, Kaizen's President and Chief Executive Officer.
"We are on the verge of drill testing these porphyry copper-gold target areas of the Fairholme mineral system because the use of Typhoon's 3-D IP has enabled our team to map chargeability beneath a significant amount of conductive cover, which in the past has inhibited conventional IP surveys."
The Fairholme Project consists of two contiguous exploration licences covering a 169-square-kilometre area located 360 kilometres west of Sydney and 160 kilometres west of the town of Orange. The project is located in the highly prospective Macquarie Arc, a well mineralized Ordovician-Silurian belt that includes several important copper-gold deposits, including the world-class Cadia deposit.
The Fairholme area has been explored by various companies since the 1970s. The most significant work was completed by Newcrest, which conducted an extensive exploration program over the Fairholme Igneous Complex between 1993 and 2005. It is estimated that Newcrest spent more than A$4 million on the project during this period. A total of 701 aircore holes (55,614 metres), 30 reverse-circulation holes (4,810 metres) and 17 diamond holes (6,575 metres) have been completed, most drilled by Newcrest within the present property boundary. Newcrest partly delineated three significant altered and mineralized zones (Boundary, Dungarvan and Gateway), with drill intercepts of up to 0.20% copper and 0.71 grams per tonne (g/t) of gold over 37 metres at Boundary (DR039, 220-257 metres), and 0.14% copper and 0.15 g/t gold over 50 metres at Dungarvan (DR046, 485-535 metres).
The recently completed IP survey at Fairholme utilized 61 transmitter positions and an array of 123 line kilometres of receivers over 31 square kilometres. The IP data were of extremely high quality, with the error of the apparent chargeability measurements estimated at 0.016 mV/V, or 0.8%. The data are the most accurate collected with the Typhoon system to date. Ten chargeable IP anomalies were defined by the survey, three of which (T1 to T3) form a large (2 x 2 kilometre) chargeability cluster between the Boundary, Dungarvan and Gateway prospects. A nearby chargeable anomaly (T5) is associated with geochemical anomalies at the Dungarvan prospect. The initial, three-hole drill program is designed to test the central chargeability cluster and anomaly T5 to a depth of 700 metres.
Funding for the drill program will include up to A$198,750 provided by the New South Wales state government under its New Frontiers program.
The Fairholme Project is being operated by Clancy Exploration Ltd. (ASX:CLY), based in Orange. Kaizen earned a 49% interest in the Fairholme Project on December 31, 2013 and has the right to increase its interest to 65% by funding an additional A$4 million in exploration prior to December 31, 2015, with the aim of delineating a scoping study. Kaizen can further increase its stake to 80% or 85% by funding a prefeasibility study (depending on the cost of the study). Kaizen will have the option to earn up to a 95% interest through additional, staged programs leading to a feasibility study.
Under a January 2014 framework agreement, ITOCHU Corporation will be provided preferential rights to fund any future exploration programs contemplated at Fairholme. The framework agreement between Kaizen and ITOCHU Corporation established a collaborative working arrangement under which both companies agreed to evaluate opportunities to explore and develop selected, high-quality, international mineral projects.