Black Dragon Gold Corp. (ASX/TSX-V: BDG) ('Black Dragon' or
the 'Company') is pleased to announce an updated NI 43-101
Mineral Resource Estimate for its Salave Gold Deposit
(‘Salave’) in northern Spain.
The updated estimate follows 2,217 metres of core drilling
completed in 2018 and based on a revised interpretation of the
Salave Deposit. The updated combined Measured and
Indicated Mineral Resource now totals 8.21 million tonnes grading
4.58 g/t Au, containing 1.21 million ounces of gold, plus inferred
resources totalling 3.12 million tonnes grading 3.47 g/t Au,
containing 348,000 ounces of gold.
The new Mineral Resource estimate has yielded a small increase
in average grade and for Salave represents a 28% increase from the
944,000 combined Measured and Indicated ounces defined in the
Company’s previous resource estimate at the same cut-off grade of
2.0 g/t Au, released in March 2014 and restated on 2 February
2017.
Mineral Resource Estimate for Salave at
2.0 g/t Au Cut-Off Grade1
Category Tonnes Au
Mt
g/t koz Measured
1.03
5.59 185 Indicated 7.18 4.43
1,023 Measured & Indicated 8.21 4.58 1,208
Inferred 3.12 3.47 348
1. Notes:
- Rounding may cause apparent
discrepancies
- Resource estimate conducted by CSA
Global of Perth Australia (“CSA”) with an effective date of October
22, 2018 and will be supported by a technical report to be filed
within 45 days of the date of this news release
- Mineral Resources that are not Mineral
Reserves do not have demonstrated economic viability
- The quantity and grade of reported
Inferred resources in this estimation are conceptual in nature and
there has been insufficient exploration to define these Inferred
resources as an Indicated or Measured resource. It is uncertain if
further exploration will result in upgrading them to an Indicated
or Measured resource category, although it is reasonably expected
that the majority of the Inferred resources could be upgraded to
Indicated Mineral Resources with further exploration
Black Dragon has initiated a Preliminary Economic Assessment
(‘PEA’) that will incorporate the increased new Mineral
Resource and a new underground mine plan. The overall goal of the
2018 PEA is to develop an economically robust mine plan that has a
minimal footprint by focusing on the highest-grade portions of
Salave’s updated Mineral Resource model. The Company’s management
is committed to and confident that we will be able to develop a
mine plan that fits in with the local community’s expectation of a
responsible and environmentally respectful mining operation.
CEO and Managing Director of Black Dragon, Paul Cronin,
commented: "In addition to the material increase on the previous
resource estimate, today’s news marks yet another significant
milestone in the advancement of Salave. We believe there is an
excellent opportunity for further expansion of the Salave resource
because the 2018 drilling program and updated resource model have
identified other areas for follow-up drilling and the potential
expansion of the Salave Deposit. The work completed over the past
12 months to update the historical data at Salave is proving a good
investment and, with additional drilling planned for 2019, we are
confident that we can further grow Salave resource base. In the
meantime, our preliminary economic assessment is under way and we
are looking forward to sharing the results before the end of the
year."
Not only has the 2018 drilling confirmed and infilled areas of
gold mineralization within the previous resource model, they
intersected high-grade intervals of gold mineralization outside of
the previous resource model, at depth and down dip to the west. The
2018 drilling was logged using oriented drill core. This
information will be used to complete a detailed structural study
over coming months to assist with the interpretation of the
structural setting that is controlling the distribution of
high-grade gold zones amenable to underground mining.
The Mineral Resource cut-off grade of 2.0 g/t Au was
chosen to capture mineralization that is potentially amenable to
underground mining and flotation processing to a sulphide
recovery for off-site refining. This cut-off grade was selected
based on a gold price of USD$1,300/ounce, a gold recovery of 92%, a
mining cost of USD$50/tonne, a processing cost of USD$18/tonne, and
a G&A cost of USD$6/tonne. The reported resources occur in
bodies of sufficient size and continuity to meet the requirement of
having reasonable prospects for eventual economic extraction. Due
to the necessity to maintain a surficial crown pillar in a
potential underground operation, all material from the present
surface to a depth of 40 meters is not included in the Salave
resources.
Alternative cut off grades returned the following results.
1 g/t Cut-Off Grade
2 g/t Cut-Off Grade
5 g/t Cut-Off Grade
Category
Tonnes Au Tonnes
Au Tonnes
Au
Mt
g/t koz
Mt g/t koz
Mt g/t koz
Measured
1.51 4.27 207
1.03 5.59 185 0.40
9.43 120
Indicated
13.31 3.05 1,307
7.18 4.43 1,023
1.61 9.47 489
Measured & Indicated
14.82
3.18 1514
8.21 4.58 1,208
2.01 9.46
609
Inferred
10.94 1.96 690
3.12 3.47 348 0.43
7.45 103
GEOLOGY AND GEOLOGICAL INTERPRETATION
The Salave Deposit consists of a series of stacked horizontal to
shallow west dipping lenses of mineralization associated with
altered (advanced sercitization and albitization) fracture zones
within the Salave Granodiorite. The Salave Granodiorite is a large
northwest-trending, approximately 500 m wide, steeply dipping
sill-like intrusive body overlain by metasediments on the western
flank of the deposit. The contact between the metasediments and the
Salave Granodiorite trends approximately northeast and dips gently
to the northwest, approximately parallel to the dip of the regional
thrust faulting and the Salave Deposit. The mineralized lenses that
form the Salave Deposit pinch and swell and at time these lenses
appear to coalesce or are connected by steeper structures, which
may act as feeders to the mineralization within the shallow dipping
lenses. As you move deeper through the deposit, the lenses appear
to offset and step down to the west and collectively form a tabular
zone immediately below and roughly parallel to the contact with the
overlying metasediments.
Gold mineralization at Salave is related to hydrothermal
alteration of the host granodiorite. The highest gold grades are
associated with intense albite-sericite alteration with
fine-grained arsenopyrite, commonly disseminated as fine needles,
pyrite and stibnite. Destruction of the original texture is a major
feature of the most intensively altered and mineralized
granodiorite. Quartz veins, and quartz-carbonate
molybdenite-bearing veins present in the deposit do not contain
gold and represent a separate mineralizing event.
Geological data has been collected in a consistent manner that
has allowed the development of geological models to support the
Mineral Resource estimate. Gold mineralization is strongly
controlled by alteration types, which were logged for all
holes.
A full model of alteration was developed, and the block model
was domained accordingly.
Interpretation of the deposit mineralization was based on the
current understanding of the deposit geology. Each cross section
generally spaced 20 m apart was displayed in Micromine
software together with drill hole traces colour-coded according to
gold values. A nominal cut-off grade of 0.47 g/t Au was
selected for interpretation based on the results of classical
statistical analysis.
A block model constrained by the interpreted mineralized
envelopes was constructed. A parent cell size of 4 m(E) x
4 m(N) x 4.5 m(RL) was adopted with standard sub-celling
to 1 m(E) x 1 m(N) x 0.9 m(RL) to maintain the
resolution of the mineralization and alteration domains. Samples
composited to 1.5 m length were used to interpolate gold
grades into the block model using Ordinary Kriging interpolation
techniques. The block model was domained using alteration codes,
which were grouped into eight main types. The alteration types were
interpolated into the model using an indicator approach and
Ordinary Kriging algorithm. Each alteration domain was estimated
separately using corresponding grade composites. Block grades were
validated both visually and statistically and all modelling was
completed using Micromine software. Density measurements were taken
from 80 holes (631 samples) and interpolated into each alteration
domain of the block model. The Mineral Resource has been classified
as Measured, Indicated and Inferred based on the guidelines
contained in the CIM. The classification level is based upon an
assessment of geological understanding of the deposit, geological
and grade continuity, drill hole spacing, quality control results,
search and interpolation parameters, and analysis of available
density information.
SAMPLING AND SUBSAMPLING TECHNIQUES
Sampling techniques:
The 2018 drilling completed by Black Dragon Gold Corp. (BDG)
consists of seven holes for 2,217 m. All core is cut (quarter
core) with a diamond saw and sampled at 1.5 m intervals for
assaying.
The historical drilling database contains 342 DD holes and 29 RC
holes. Various sampling intervals were adopted, including 3 m, 1 m
and 1.5 m. Of the 342 DD holes and 29 RC holes included in the
database and completed prior to the 2018 drill program, 265 holes
(250 core, 13 combination core RC and two RC holes) were used to
generate the previous MRE by MDA.
The 2018 drilling is PQ to the oxide fresh rock interface
(16-61m) and then HQ in fresh rock. Sampling is half quarter core
over 1.5 m and quarter core is sent for analysis. Both core
sizes methods produced a representative sample.
Historical sampling used split core (using either hammer and
chisel or diamond saw), including BQ (36.5 mm), NQ (47.5 mm), HQ
(63.5 mm) and PQ (85 mm) intervals.
Diamond drilling was used in 2018 to obtain 1.5 m quarter core
samples from which was pulverized to produce a 50 g charge for fire
assay, and a 0.25 g charge for near total four-acid digest for (S,
As, Sb).
Historical analysis spans 1970–2005 with explorers analyzing
with various analytical techniques, but primarily fire assay.
Confirmatory drilling completed from one explorer to another
appears to confirm the general magnitude of the grades.
Subsampling techniques:
Current drilling: All core is cut in half and quartered, and
quarter core is assayed. Quarter core samples were collected which
is considered acceptable by the Competent Person. Additional
subsampling of quarter core is carried out to demonstrate sampling
precision. A second quarter core sample has been collected as field
duplicates. QAQC sampling of the quarter core is representative of
the in-situ material. No results have been returned as yet to
evaluate.
Historically, core was cut in half and assayed. Not all core was
assayed particularly at the collar and intervals interpreted to be
barren. All barren intervals were populated with 0.005 g/t gold
grades. There is no record of the historical sampling of RC
drilling and with the exception of two RC and 13 combination
RC/core holes, the remaining RC drilling was not used in the
current resource estimate. Subsampling protocols were generally
consistent with historical samples taken. Each subsample is
considered to be representative of the interval.
Considerable sampling for metallurgical testwork was carried out
by Rio Narcea, Anglo, Newmont and Lyndex. The results confined the
tenor of the drill hole grades.
Sample sizes area considered appropriate to reasonably represent
the material being tested.
DRILLING TECHNIQUES
Current (2018) drilling commenced with PQ reducing to HQ
standard tube and core is orientated using a standard spear method.
Historically, drill core diameter typically commenced with either
HQ or NQ and all holes reduced core size at varying downhole
depths. The smallest diameter at the end of hole was BQ. Core
recovery from 2018 drilling is estimated using the driller’s
recorded depth marks against the length of the core recovered.
There is no significant core loss from holes drilled in 2018.
Historical drill core recovery data for 70% of the intervals has
been sighted with an average recovery of 95% within a range of
80–100%.
The ground conditions are reasonable and standard single tube
coring techniques results in good sample recovery. There appears to
be no potential sample bias as there was no regular or excessive
loss of core.
DRILL HOLE DENSITY
Drill hole density across the project (including all drilling)
is approximately 20–40 m x 20–40 m closing in to better
than 10 m x 10 m in places.
The data spacing, and distribution is sufficient to establish
the degree of geological and grade continuity appropriate for the
Mineral Resource classifications applied.
SAMPLE ANALYSIS METHOD
BDG used ALS in Seville, Spain, a fully accredited laboratory
using the following methods:
- Au-AA26 Au by fire assay and AAS (50 g
pulp sample) for gold.
- PREP-31CY for sample preparation fine
crushing – 70%; <2 mm, split sample – Boyd rotary splitter,
pulverise 1,000 g to 85% <75 um.
- ICP 61 – near total four-acid digest
for (S, As, Sb).
ESTIMATION METHODOLOGY
The MRE is based on surface drilling results using Ordinary
Kriging (OK) to inform 4 m x 4 m x 4.5 m blocks. The
block model was constrained by one wireframe modelled for the
mineralized zone of the deposit. Sectional interpretation was
carried out for all sections of the deposit. The OK interpolation
was carried out separately for each alteration domain of the
deposit. The alteration domains were interpolated into the model
using indicator approach and OK interpolation method, using all
available alteration logging. Hard boundaries were used between the
interpreted mineralization and host rocks, as well as between
alteration domains. The drill hole data were composited to a target
length of 1.5 m based on the length analysis of raw intercepts.
Grade estimation was validated using visual inspection of
interpolated block grades vs. sample data, alternative
interpolation methods and swath plots.
CUT-OFF GRADE(S), INCLUDING THE BASIS FOR THE SELECTED
CUT-OFF GRADE(S)
A cut-off grade of 2 g/t Au was used to report the Mineral
Resources. The selected cut-off assumed underground mining
method.
MINING AND METALLURGICAL METHODS AND PARAMETERS, AND OTHER
MATERIAL MODIFYING FACTORS CONSIDERED TO DATE
Mining is assumed to be by underground methods. Considerable
metallurgical testing of drill core has been completed on Rio
Narcea, Anglo, Newmont and Lyndex core intervals. These data
provide the bulk of the data verification for the deposit. All the
tests reported have drill hole sample weights so that the drill
hole assays can be compared to metallurgical test head assays and
calculated heads.
QUALIFIED PERSONS AND COMPETENT PERSONS STATEMENT
The information in this announcement that relates to the updated
Mineral Resource estimate for the Salave Gold Project is based on
and fairly represents information and supporting documentation
prepared by Dmitry Pertel MAIG, of CSA Global, is the Independent
Qualified Person as defined by National Instrument 43-101 and is
responsible for the updated Mineral Resource Estimate reported
herein. Douglas Turnbull, P.Geo. Mr Turnbull is a member of the
Association of Professional Engineers and Geoscientists of the
Province of British Columbia, Canada (Engineers and Geoscientists
BC), a recognised professional organisation for the purposes of the
JORC Code. Douglas Turnbull is the President of Lakehead Geological
Services, and a consultant to the Company. Douglas Turnbull has
provided his prior written consent as to the form and context in
which the updated mineral resource estimate and supporting
information are presented in this announcement. Santiago Gonzales
Nistal, EurGeol., a Qualified Person as defined by National
Instrument 43-101 and consultant to Black Dragon, supervised the
2018 diamond drilling program at the Salave Gold Project, has
reviewed and approved the scientific and technical disclosure in
this news release.
BLACK DRAGON GOLD CORP.1000 Cathedral Place925 West Georgia
StreetVancouver, BC V6C 3L2, Canada,T- +44 20 79934077 F- +44 20
71128814info@blackdragongold.comwww.blackdragongold.com
ABOUT BLACK DRAGON GOLD
Black Dragon Gold "BDG" is the 100% owner of one of the largest
undeveloped gold projects in Europe, the Salave project. Salave is
situated in the North of Spain in the province of Asturias. The
Salave project has an updated combined Measured and Indicated
Mineral Resource of 8.21 million tonnes grading 4.58 g/t Au,
containing 1.21 million ounces of gold, plus Inferred resources
totalling 3.12 million tonnes grading 3.47 g/t Au, containing
348,000 ounces of gold. A full technical report summarizing the
Mineral Resource estimate completed by CSA Global is in progress
and will be completed and posted on SEDAR and the Company’s website
within 45 days. In addition to the current Mineral Resource,
historical exploration work suggests there is the potential for
additional mineralization within Black Dragon’s landholdings.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20181024005442/en/
Paul CroninCEO & Managing DirectorP: +44 20
79934077E: paul.cronin@blackdragongold.comorPeter
KlingerCannings PurpleP: +61 (0)411 251 540E:
pklinger@canningspurple.com.au
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