The flagship Crater Mountain Project is a potential multi million ounce gold deposit located in the eastern highlands of PNG. Significant gold mineralisation has been discovered on the surface and at depth in drilling.
High Grade Zone
Gold Mining to commence at HGZ Project
Crater Gold Mining Limited is set to become a gold producer following the grant to its PNG subsidiary Anomaly Limited of a Mining Lease for the High Grade Zone gold project
Following a rigorous environmental and social impact assessment process involving the PNG Department of Environment and Conservation and the Mining Advisory Council, the Minister for Mining, the Hon Byron Chan, issued the Mining Lease for the HGZ project.
The granting of the Mining Lease is a watershed milestone for the Company as it transitions from developer to gold producer.
A mill and gravity concentration circuit are already commissioned on site. The Company will commence gold mining shortly.
The High Grade Zone (HGZ) is an area of recent artisanal gold mining in which an estimated 15,000 ounces of gold was produced by local miners largely from shallow underground workings and simple gravity processing between 2005 and early 2013.
A decision was made by the Company early in 2013 to assess the potential of the HGZ for fast-tracking small to medium-scale gold production, with the strategy of reinvesting profit into the on-going exploration of the Nevera Prospect’s larger-scale potential.
The Company has been developing the HGZ since August 2013 through the development of an underground adit and cross cuts and an ongoing drilling program. This development has passed through a wide zone of intense brecciation containing numerous narrow gold bearing mineralised structures correlating well with surface artisanal gold workings.
The veins of relevant interest are those recording significant grades and which can be extracted using small scale, highly selective, narrow vein mining techniques.
The Company believes that in the first year, production of 10,000 gold ounces is achievable.
Maiden Inferred Resources
A maiden inferred JORC compliant resource of 24Mt @ 1.0 g/t Au using a 0.5 g/t Au cut-off for 790,000 ounces has been defined ; this includes 9.4Mt at 1.46 g/t using a 1.0 g/t Au cut-off for 440,000 ozs (this inferred resource is open laterally and perhaps to depth, following down a possible steep plunge to the northeast) Importantly, the estimate does not include the High Grade Zone or the porphyry intrusion " feeder zone " at depth
Only considers part of Main Zone at Nevera
Main Zone still open
High grade zone identified within Main Zone
Significant upside potential yet to be drilled
Results indicate the potential for multiple major mineralisation events at Nevera, and highlight the pervasive nature of gold mineralisation through the overlying Nevera volcanics.
There is strong potential for further gold and copper discoveries at the adjacent prospects to Nevera.
Croydon Polymetallic Project
The drilling results at the A2 prospect are of particular interest, with discovery hole A2-001 returning a 5m massive sulphide intercept containing a weighted average of 8% Zn, 180g/t Ag, 0.58% Sn and 0.57% Cu (gold equivalent of approximately 9.9g/t Au1
). Similar high value massive sulphide filled fracture zones are present in six of the other holes and all nine holes contain thick intercepts of strong Zn-Ag anomalism indicating the presence of a large mineralizing system (see table 1 and figure 5). Mineralisation is hosted by Proterozoic
sediments (banded siltstones) and commences at approximately 130m vertical depth near an unconformity with overlying Mesozoic cover rocks.
A vertical projection plot and cross sections of the more important massive sulphide zones from drilling at A2 show that the intercepts align in linear patterns with an east-west strike and apparent vertical dip. The hole spacing and pattern suggests a possibility for strike-dip continuity of the zones. The present hole spacing of 200m is too wide for certainty, but if proven the massive sulphide zones could represent a sizable polymetallic-tin deposit analogous to the Dajing deposits of Inner Mongolia that have been major producers of base metals, silver and tin for over 40 years.
Croydon Graphite Project
In July 2004 the Company, when named Gold Aura Ltd, undertook preliminary assessment of a large graphite deposit located at the Golden Gate mine. The graphite deposit was systematically drilled as part of a regional gold exploration program in the late 1980’s by Central Coast Exploration (CCE). Three vertical reverse circulation holes were later drilled by the Company between 2005 and 2007 that confirmed a thick graphite zone was present at Golden Gate.
Croydon Gold Project
Gold mineralisation at Croydon occurs in planar quartz veins, stockworks and breccias . The largest producer in the Croydon Gold Field, the Golden Gate Lode (480,000 ounces of gold) is located within EPM18616 and EPM9438, tenements owned 100% by the Company.
The acquisition of EPM18616 by Crater Gold consolidates the length of the Golden Gate lode within tenements held by CGN. Five priority exploration targets along the trend of the Golden Gate lode have been identified . These areas were selected as having potential for gold mineralisation under shallow cover. Future exploration will involve ground geophysics (IP & EM surveys) across target trends followed by drilling.
The Fergusson Island Project is owned by Crater Gold Mining Limited incorporates the Gameta and Wapolu gold deposits which are approximately 30 kilometres apart and lie a short distance inland from the northern coastline of Fergusson Island in the D’Entrecasteaux Island Group of Milne Bay Province, Papua New Guinea.
The Gameta Deposit lies within EL 1972. It is located on the northeast coast of Fergusson Island. The Wapolu Deposit lies within EL 2180
The two properties have been explored for gold since the early 1980’s during which time a total of 195 reverse circulation (“RC”) holes (10,179m) and 33 diamond holes (4,181m) have been drilled at Gameta and 296 RC and air core holes (11,646m) and 97 diamond holes (6,401m) have been drilled at Wapolu
Gameta Resource Estimate
In 2010 H&S Consultants developed a JORC-compliant Inferred Mineral Resources estimate for the Gameta Deposit that differs from their above 2005 estimate based on additional diamond drilling that extended mineralisation below the shallower RC holes, and also on the downward factoring of RC gold grades based on an element of uncertainty regarding the information on the RC drilling. The Inferred resource using multiple indicator kriging and a 1.0 g/t Au cut-off grade was 5.1 Mt at 1.8 g/t Au for 295,000 ounces of gold
1 The gold equivalent value is calculated using metal prices from the London Metal Exchange quoted on the 23-1-13 and will vary as the metal prices rise or fall.