Wolf Wiese, CEO of Golden Dawn Minerals Inc. (TSX-V:GOM)
(FRANKFURT:3G8A) (OTC:GDMRF) (the “Company” or “Golden Dawn”),
announces that a NI 43-101 Technical Report describing the updated
Mineral Resource Estimate for the J&L Project has been
completed by P&E Mining Consultants Inc. and filed on SEDAR.
The updated Mineral Resource Estimate (effective date January 23,
2018) contains 1.35 million gold equivalent ounces in the Measured
and Indicated categories and 1.08 million gold equivalent ounces in
the Inferred category (table below). J&L is therefore one of
the largest undeveloped gold Mineral Resources in western Canada.
J&L Mineral Resource Estimate at
C$110/tonne NSR Cut-Off (1-6)
Main Zone |
Tonnes(000’s) |
Au (g/t) |
Au(000’s oz) |
Ag(g/t) |
Ag(000’s oz) |
Pb(%) |
Zn(%) |
AuEq(g/t) |
AuEq(000’s oz) |
Measured |
1,337 |
6.19 |
266 |
63.3 |
2,721 |
2.21 |
4.12 |
9.69 |
417 |
Indicated |
2,778 |
5.42 |
485 |
49.8 |
4,450 |
1.75 |
3.16 |
8.14 |
727 |
Meas & Ind |
4,115 |
5.67 |
751 |
54.2 |
7,172 |
1.9 |
3.47 |
8.65 |
1,144 |
Inferred |
4,433 |
4.42 |
630 |
63.0 |
8,978 |
1.92 |
2.65 |
7.13 |
1,016 |
Hanging Wall Zone |
Tonnes(000’s) |
Au (g/t) |
Au(000’s oz) |
Ag(g/t) |
Ag(000’s oz) |
Pb(%) |
Zn(%) |
AuEq(g/t) |
AuEq(000’s oz |
Indicated |
280 |
0.91 |
8 |
57.1 |
515 |
2.59 |
5.93 |
5.33 |
48 |
Inferred |
33 |
0.24 |
0 |
77.7 |
83 |
3.16 |
5.89 |
5.11 |
5 |
Footwall Zone |
Tonnes(000’s) |
Au (g/t) |
Au(000’s oz) |
Ag(g/t) |
Ag(000’s oz) |
Pb(%) |
Zn(%) |
AuEq(g/t) |
AuEq(000’s oz |
Inferred |
319 |
4.04 |
41 |
25.9 |
265 |
0.54 |
0.47 |
4.77 |
49 |
Yellowjacket Zone |
Tonnes(000’s) |
Au (g/t) |
Au(000’s oz) |
Ag(g/t) |
Ag(000’s oz) |
Pb(%) |
Zn(%) |
AuEq(g/t) |
AuEq(000’s oz |
Indicated |
764 |
0.09 |
2 |
62.8 |
1,544 |
2.61 |
9.98 |
6.42 |
158 |
Inferred |
23 |
0.12 |
0 |
55.5 |
41 |
2.67 |
7.75 |
5.38 |
4 |
TotalAll Zones |
Tonnes(000’s) |
Au (g/t) |
Au(000’s oz) |
Ag(g/t) |
Ag(000’s oz) |
Pb(%) |
Zn(%) |
AuEq(g/t) |
AuEq(000’s oz |
Measured |
1,337 |
6.19 |
266 |
63.3 |
2,721 |
2.21 |
4.12 |
9.69 |
417 |
Indicated |
3,823 |
4.03 |
495 |
53.0 |
6,509 |
1.98 |
4.73 |
7.60 |
934 |
Meas & Ind |
5,160 |
4.59 |
761 |
55.6 |
9,231 |
2.04 |
4.57 |
8.14 |
1,351 |
Inferred |
4,808 |
4.35 |
672 |
60.6 |
9,367 |
1.84 |
2.55 |
6.95 |
1,075 |
1) Mineral Resources which are not Mineral Reserves do not
have demonstrated economic viability. The estimate of Mineral
Resources may be materially affected by environmental, permitting,
legal, title, taxation, socio-political, marketing, or other
relevant issues.
2) The Inferred Mineral Resource in this estimate has a
lower level of confidence than that applied to an Indicated Mineral
Resource and must not be converted to a Mineral Reserve. It is
reasonably expected that the majority of the Inferred Mineral
Resource could be upgraded to an Indicated Mineral Resource with
continued exploration.
3) The Mineral Resources in this estimate were calculated using
the Canadian Institute of Mining, Metallurgy and Petroleum (CIM),
CIM Standards on Mineral Resources and Reserves, Definitions and
Guidelines prepared by the CIM Standing Committee on Reserve
Definitions and adopted by CIM Council.4) The following
parameters were used to derive the NSR block model cut-off values
used to define the Mineral Resource:
- Dec 31, 2017 US$ two year trailing avg. metal prices: Pb
$0.95/lb, Zn $1.13/lb, Au $1,253/oz, Ag $17.08/oz
- Exchange rate of US$0.76 = CDN $1.00
- Process recoveries of Pb 74%, Zn 75%, Au 91%, Ag 80%
- Smelter payables of Pb 95%, Zn 85%, Au 96%, Ag 91%
- Refining charges of Au US$10/oz, Ag US$0.50/oz
- Concentrate freight charges of C$65/t and Smelter treatment
charge of US185/t
- Mass pull of 5% and 8% concentrate moisture content.
5) The NSR cut-off of CDN$110 per tonne was derived from $75/t
mining, $25/t processing and $10/t G&A.
6) AuEq= Au g/t + (Ag g/t x 0.011) + (Pb %
x 0.422) + (Zn % x 0.455)
J&L is an advanced stage project located 35
km north of Revelstoke, BC, and consists of mineral tenure claims
and crown granted claims that total 3,150.74 hectares. Huakan
International Mining Inc. owns 100% interest in the J&L
Property (the “Property”) and assets without any underlying
royalties. Golden Dawn announced signing a three-stage option
agreement on December 18, 2017 to earn 100% interest of J&L
from Huakan subject to an NSR Royalty. The option agreement is
subject to regulatory approval.
The Property has been explored by a number of
mining companies by trenching, tunnelling and drilling. There are a
total of 315 drill holes completed on the property from 1983 to
present (41,075.9 metres). The 830 drift and related cross-cuts
total 3.1 kilometres exposing the Main Zone for approximately 0.8
kilometres. The 550 metre long 832 trackless drift provides year
round underground access to the 830 drift. Other assets include a
rail siding and load-out facility for the Canadian Pacific Railway
in Revelstoke, and a fully functional 40-man camp as well as a
large shop and office facility located at the property, as well as
a fleet of previously utilized underground mining equipment.
The J&L Property lies at the northern end of
the Kootenay Arc which is known for its Irish-type carbonate hosted
Zn-Pb, volcanic-hosted massive sulphide (VMS) deposits (Goldstream)
and Sedimentary Exhalite (Sedex) deposits. The two main deposits on
the J&L Property are the Main Zone and the Yellowjacket
Zone. Geologists who have worked on the Main Zone in the past
have proposed a Sedex model, a VMS model, a replacement model and a
shear hosted model. Huakan geologists interpret the
Main Zone to be a shear-hosted sheeted sulfide replacement
deposit that lies in a thrust zone and post-dates the Yellowjacket
Zone mineralizing episode. The Yellowjacket Zone has a close
affinity to Irish-type carbonate hosted Zn-Pb deposits. However,
core examinations point to a contact replacement model with
pervasive silica flooding.
The Main Zone is a sheeted gold-silver sulphide
vein system composed of arsenopyrite-pyrite-sphalerite-galena
mineralization. It has a surface trace of over 3 kilometres
strike length, and is traced by drilling for 1.5 kilometres strike
length and 0.8 kilometres dip length. In addition, it is speculated
that the Main Zone is linked to the Roseberry Prospect and also to
the former Mastodon Mine, which would suggest a collective
potential strike length of 9 kilometres. The Main Zone
generally dips approximately 60 degrees to the northeast with an
average true thickness of 2.5 metres; however, it can reach up to
15 metres in true thickness. Extensive drilling has indicated
a traceable continuous plane with virtually no fault offsets,
cut-offs or fault drags zones. As such, there remains
excellent potential for additional resources on the Main Zone; it
remains open up and down dip, and along strike to the northwest and
possibly to the southeast.
Sub-parallel intermittent footwall and hanging
wall zones occur proximal to the Main Zone. One hanging wall zone
(HM1) (named HW Zone in the Mineral Resource Estimate) lies
approximately 5 metres to the hanging wall of the Main Zone.
A footwall zone (FM1) (named FW Zone in the Mineral Resource
Estimate) zone lies approximately 5 metres to the footwall of the
Main Zone. Other zones include a second hanging wall zone
(HM2) that lies approximately 20 metres to the hanging wall of the
Main Zone, and a second footwall zone (FM2) that lies approximately
20 metres to the footwall of the Main Zone (Mineral Resources have
not been defined on these secondary zones).
The Yellowjacket Zone is silver-lead-zinc-rich,
and is composed of multiple parallel siliceous sphalerite-galena
bearing zones. The individual zones making up the Yellowjacket Zone
occur as lenticular bodies each up to 8 metres thick at the contact
between alternating units of volcanics and limestone. The
Yellowjacket Zone sub parallels and is in the immediate hanging
wall of the Main Zone. The Yellowjacket Zone has higher silver,
lead and zinc values than the Main Zone but no notable
gold.
Underground bulk samples have been taken from
the Main Zone to conduct metallurgical test work. The Main Zone is
a complex polymetallic deposit high in arsenic values which create
a challenge in the production of saleable zinc and lead
concentrates and the economic recovery of gold. Extensive
metallurgical testing between the mid 1980’s and 2014 have
considered various options and have produced numerous effective
options for acceptable recoveries of gold, silver, zinc and lead by
making 3 separate concentrates, including using heavy media
separation. Based on the current envisioned circuit and
corresponding laboratory test response, the overall process
recoveries for the Main Zone are expected to be approximately 93%
Au, 70% Ag, 74% Pb, and 80% Zn. Limited metallurgical test
work from drill core has been performed on the Yellowjacket Zone,
which appears to have less complex metallurgy than the Main Zone.
The expected process recoveries for the Yellowjacket Zone are 94%
Ag, 88% Pb, and 93% Zn.
On February 6, 2018, Golden Dawn reported that a
legal action has arisen between Armex Mining Corp. (“Armex”) and
Huakan whereby Armex claims that it has a valid letter of intent
with Huakan covering Huakan’s J&L property. Huakan has notified
the Company that it intends to defend the Armex action. The
legal action has not been resolved at this time. Huakan has filed a
compelling defense and has initiated a substantial counter claim.
Huakan’s legal counsel Dentons LLC and Golden Dawn’s legal counsel
are confident of a favourable outcome for Huakan International
Mining Inc.
Assuming a resolution in Huakan’s favour, Huakan
and Golden Dawn could proceed with the recommended Phase 1 program.
Subsequent to the May 2012 PEA, 45 additional drill holes
were completed resulting in a sizeable increase to the Mineral
Resource Estimate. The metal prices and US$ exchange rate have
changed considerably since the May 2012 PEA as well. It is
therefore justifiable and recommended to update a PEA for J&L.
The cost of updating a PEA is estimated at $250,000. Once
completed, the results can drive the next steps of advancing the
Project. Assuming the results of the updated PEA are
favourable, a Phase 2 program to advance the J&L project
through a Pre-Feasibility Study would be appropriate at an
estimated cost of $800,000. Associated with the Pre-Feasibility
Study additional recommended work includes metallurgy, geotechnical
site assessment drilling and some currently incomplete
environmental studies. These additional studies are estimated to
cost an additional $800,000. A drifting and drilling campaign to
expand Mineral Resources would be a sizable program and could cost
several million dollars.
Conditional on a resolution in Huakan’s favour,
Golden Dawn is committed to updating the Preliminary Economic
Assessment (PEA) to fulfil the first phase of the terms of its
option agreement. The Company has no further significant
obligations under the terms of the option agreement until a
decision is made to proceed with a Pre-Feasibility Study. Golden
Dawn intends to manage the J&L Project on a stand-alone basis
and finance it on the foundation of an economically robust
Pre-Feasibility Study.
DISCUSSION:
In other news, the Greenwood Precious Metals
Project milestones are being met in a timely manner. As recently
reported (news release January 18, 2018), de-watering of the
Lexington Mine is now complete and current work is progressing
towards start-up of operations within the next few months.
Technical disclosure in this news release has
been approved by Eugene Puritch, P.Eng., FEC, CET of P&E Mining
Consultants Inc., who is a Qualified Person as defined by NI 43-101
and is independent of Golden Dawn Minerals Inc.
On behalf of the Board of Directors,GOLDEN DAWN
MINERALS INC.
Wolf Wiese, President & CEO
For further information, please
contact:
Corporate Communications604-221-8936
allinfo@goldendawnminerals.com
This press release was prepared by management,
who take full responsibility for its contents. Neither the TSX
Venture Exchange nor its regulation services provider (as that term
is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release. This
document contains certain forward looking statements which involve
known and unknown risks, delays, and uncertainties not under the
Company’s control which may cause actual results, performance or
achievements of the Company to be materially different from the
results, performance, or achievements implied by these forward
looking statements. We seek safe harbor.
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