Their objective (as per 22/11/06 AGM presentation) is 3MT of base metal resource – which would be enough for a small mine – or 0.5M Oz Gold. This doesn’t mean they’ll achieve it of course. Turner River is a VMS style of deposit (Volcanogenic Massive Sulphide) containing Zn, Ag, Pb, Au, Cu. Generally these deposits occur in clusters of 4 to 11 (Golden Grove is an example). LME Zinc stocks are only 100Kt at the time of writing. More normal levels are 750Kt. From 2007 a zinc supply deficit is forecast.
Initial drilling was by RAB, this has been followed up with RC and most recently, DD drilling. The most recent DD (diamond) drilling got 3.85m @ 19.4% Zn equivalent in hole WADH003. This hole is 140m west of a previous RC hole which also had grade. This is good stuff. For comparison CBH are mining a grade of 6.8% Zn, 4.1% Pb, 51g/t Ag. The strike extent of the mineralised horizon has been shown to be 20km from RAB drilling (quick & cheap but low quality drilling technique). Other hits are WARC049 2m @ 7.95% Zn, 246g/t Ag, 4.78% Pb, 1.2g/t Au, 0.57% Cu from 88m depth (open pittable depth). There are many other hits of this calibre. The grades would be economic even at much lower metals prices. All they have to do now is prove up some tonnes by getting enough drilling density to calculate a JORC resource. Also in the most recent DD programme hole WADH005 got 6m @ 45.8g/t Au and 66g/t Ag from 193m. Highest grade to date WADH012 (announced on 20/12/06) returned: 4.90m @ 12.7% zinc, 331g/t silver, 7.31% lead, 2.54g/t gold and 0.35% copper from 514.4m (4.9m @ 20.3% Zn equivalent). This hole was 210m down dip of a previous ore-grade intersection. Mineralisation remains open at depth, to the west and stretches 130m east to another high-grade hole drilled previously.
179m shares on issue (market cap 26m @ 14.5c). Presentations etc can be seen at the company’s website http://www.degreymining.com.au/
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