Vizsla

Vizsla Resources share prices have been rocketing up recently on the back of some very juicy drill results (link and link) from their Copala project in Sinaloa, but is there more to the story than just a few hot holes or have they managed to consolidate a world-class mining district?

TL:DR version - No

What really interests me is that Vizsla keep telling us this:

Never been systematically explored? We have these maps in Vizsla's own PRs and presentations:

We have 2 areas with historic resources and a long section of the Animas vein with >100 holes on it. Maybe the drilling was done by the mine operator? Fortunately, Vizsla give us a helping hand and tell us at the bottom of the Panuco project page (just before the photos).

So, I went over to Sedar and downloaded the report. A full 100 pages of geological fun, which gently summarized the historic, non-systemaic work done by Silverstone, who only managed to drill:

Thta's only 21,641m in 200 holes. I'm guessing that Vizsla forgot about these holes. My guess is that the core doesn't exist anymore, or that looking at the long section above a chunk of the Clemes/Muerto zone was mined, and if we have a look at them, we see:

That they are a bit shite! Silverstone only managed to drill >21km of drilling in 2 holes and defined a small, low grade resource. Why?

We have 2 options:

1. Silverstone were crap, and managed to drill all the shite areas again and again
2. The mineralization at Copala is hosted in very small high-grade ore-shoots

Let us not question the competence of Silverstone, and focus on the second point - small, inconsistent zone of mineralization. We can look for this in a number of ways:

Directly

• High-grade mineralization restricted to 1 or 2 holes surrounded by lots of nothing
• high-grade intervals not joining up - the vein's the same, but suddenly the silver and gold have gone on holiday to a narrow foot-wall or hanging-wall vein

Here is a long section from the Honduras vein at Copala

Look at the scale - holes AM-20-08 is only 50m from holes 09, 10, and 11. We go from good to nothing in 50m. 

We see the same at the Napoleon discovery

There are some good drill-holes here, and the drilling here is at its early stage, but we can see that the high-grade intercepts are jumping from structure. We can also see that the "F" and "G" veins don;t appear to be very continuous, as they aren't intersected by hole NP-20-07 just 20m away.

Indirectly

• "Missing" intervals - we see on a map or section "waiting assay results", but the results never arrive
• "Missing holes" - were have the results for holes 01, 02, 05, 09 - WFT happened to holes 03, 04 and 06 --> they hot feck all is what happened.

Missing holes can also be expanded into an entire drill program going AWOL - this means all the holes were crap, and the company doesn't want to hurt everyone's feelings.

So, going through the technical report (you can download it from here), there is a table of all the narrow, high-grade hits (table 13.1)

This is just the first few intervals, there are 3 more pages for you to look at, but they look very similar to what Vizsla are getting and this is what they got:

This is crap for an underground mine, 370Kt @ 370 g/t AgEq, you can't do much with that.I hope Vizsla do find some massive ore-bodies, but the data presented by Silverstone and what we're seeing in the initial 2020 drilling data is that the high-grade mineralization is found is discrete, small ore-shoots.

One final comment, we're told this on the website:

How much are the mines producing? How big is the mill? Surely Vizsla will have some historic production figures to support the $23M purchase price?

BTW - Vizsla - Fresnillo don't own the Zacatecas district. Pan American and Capstone have a good chunk and ~50% was just sold by Santacruz silver to Zacatecas Silver earlier this year. You may want to correct that.

Havieron, Greatland Gold

I apologize for the delay, basically I've been lazy and catching up with some personal projects during the 'ronavirus crisis.

Sticking with the Patterson Range, I've manage to compile the drilling data for Greatland's Haverion project, currently being drilled by Newcrest with 9 rigs.

An updated Leapfrog viewer file can be got from here (link)*, so you can have a look at the data in 3D.

At first pass, the data suggests that Greatland/Newcrest have found a good deposit, but we want to dig a little deeper to see:

1. Size and grade potential
2. Possible issues and questions
3. Regional upside

Geology

Feel free to ignore this section, it is dull.

Here is a long section of the deposit, showing the Au and Cu distribution



We can see that the mineralization is a long-way down. We have ~400m of post-mineral Permian cover rocks (young rocks for WA).

We can see that the highest copper grades are found at the contact with the Permian rocks (maybe some localized supergene enrichment?) whereas with gold you do get some high-grade (>2.5 g/t Au) throughout the deposit.

We can also see that the Au-Cu mineralization is restricted to a breccia with some high grade narrow intercepts related to sulphide veins, this appears to be similar to what is seen at Telfer, just with a big difference.

Figure from GSDRPT 97 by Govt of WA

At Telfer they had stratabound quartz-sulphide reefs, it would be interesting to see if the high-grade crescent sulphide zone is actually one of these stratabound zones or formed through the deformation of the breccia into the crescent shape shown on the plan map below?

It is a very busy map

From the plan map and mineral distribution we can see the core area, where we have thick intervals of high-grade mineralization and 2 narrow limbs of high-grade intercepts continuing to the NW. Core area, probably at the nose of fold/deformation zone, with 2 narrow, but high-grade (>1% Cu) limbs striking to the NW.

G&T

We've had lots of holes drilled into Havieron, at least 60 holes so far, so I'm expecting that we should see an initial resource estimate some time this year, so taking the available data, this is what I've come up with:

You can see that at Haverion there is a bit of copper, but essentially it is a gold project, depending on the cut-off grades used, I think 100Mt @ 1 g/t Au and 0.5% Cu is a good start. Is it a bit small to develop on its own, maybe, but it is only ~50km from Telfer that the ore could be transported to the Telfer mill for processing which would minimize CAPEX.

Potential Problems

Looking through the data, one thing that I saw was a lot of grade smearing, especially in the drill-holes that intersected mineralization peripheral to the Crescent zone.



The right-hand section is going through the core of the Crescent zone and left hand section is from the NW continuation of the breccia zone, with hole HAD066 reporting the PR banner intercept of 82.1m @ 2.4 g/t Au.

In the core of the Crescent zone, I'm less concerned and the UHG veins/zones are generally wide and often surrounded by breccias grading > 1g/t Au, but the biog issue I see, and one that to me, limits the size potential at Haverion is the continuation of wide zones of economic mineralization outside of the core Crescent zone, and drill-hole HAD-066 summarizes it quite well:

• HAD066 - 82.1m @ 2.4 g/t Au inc.
• 0.2 @ 59 g/t Au
• 1.5m @ 86 g/t Au

If we remove those narrow high-grade zones the grade of the surrounding breccias decrease from 2.4 g/t Au down to just 0.7 g/t Au, a 70% decrease. This suddenly changes HAD066 from intersecting a wide-zone of economic mineralization to just a couple of narrow high-grade hits in a sea of low-grade waste.

It appears to indicate that the breccias do continue to the NW, but they don't appear to be economic, and to me, limits the size potential of Haverion. It still appears to be a decent size, the mineralization appears to be open to depth (but will require very deep drilling).

Regional Exploration

Virtually all of the exploration to date has focused on Haverion but there do appear to be other interesting targets in the area that look interesting

The Haverion body is a nice magnetic high, and we can see several other similar features on the regional magnetic data shown in Greatland's presentation.

For me, Kraken looks very interesting. It has a similar magnetic anomaly to Havieron, , whereas London and Blackbeard appear, to me, to be picking out a folded magnetic unit with the metaseds of the Paterson Range rock package.

Summary

It is great discovery by Greatland Gold, there are potentially excellent synergies with Telfer, that, in my opinion, make this deposit an excellent take-over target for Newcrest. I'll be following the drill results closely and I would like to see a few holes stated to be drilled in the other targets to see if there are other breccia bodes in the area.

*thank you to Tumshie, I had accidentally made the 1-2.5 g/t Au grade shell invisible.

Winu - Exciting times in the Pilbara

As I'm still getting back into the swing of things, and I want to have a look at some of the recent discoveries being made in the Paterson Province in Western Australia.

If you want some background information on the geology and deposits of the area you can download an excellent summary on the geology and mineral deposits of that area (link) by the Geology Survey of Western Australia.

Compared to many areas of Australia, the Patterson Province is relatively unexplored. Its remoteness to the traditional gold belts and iron ore zones to the SW and W meant that semi-detailed exploration didn't really commenced in this area in the 1960s.

Early exploration in the 1970s and 1980s discovered 1 world-class deposit - Telfer Au-Cu mine (total production >10Moz Au) churning out >400Koz/year) and a couple of medium-sized copper deposits at Nifty (link) and Maroochydore (link).

So, it has been nice to read about a couple of the new, potentially large discoveries being made by Rio Tinto and Winu and Newcrest/Greatland Gold at Haverion.

We'll start with Winu, and I was surprised that Rio have been publishing a lot of exploration data from Winu (link and link), and so I've imported the data into Leapfrog to see what all the noise is about. You can get the Leapfrog model from here (link)

We have lots of impressive intercepts, including:

• 741m @ 0.45% Cu, 0.52 g/t Au
• 499m @ 0.4% Cu, 0.2 g/t Au
• 439m @ 0.42% Cu, 0.32 g/t Au
• 84m @ 0.62% Cu, 1.41 g/t Au

A nice high-grade core surrounded by lower grade mineralization. There appears to be some zonation, with an Au-rich core surrounded by more Cu dominant mineralization, with minor silver, but no-one cares about that.



We can also see that the mineralization is relatively shallow, ~100-150m depth, but with all deposits, it is important to get a sense of scale. We see so many projects that have great grades but all that quality is concentrated in a tiny package, here we don't have that problem!



Rio have drilled decent mineralization over a 2km strike length, that is impressive, we can even have stab and seeing how much Rio have found....

Pretty impressive, Rio appear to have found a large 500Mt, moderate grade ~0.5%CuEq Cu-Au deposit in the middle of nowhere. It is moderately deep (60-150m depth), there appears to be good potential to expand the mineralization to depth and along strike, so I will be see how this project evolves.

However, one big question to ask is - is this project big enough for Rio? I would expect that they would want something that is 2-3 times larger for development.

Next week - Havieron!

Some geology rubbish

In many other mineral districts companies have applied Zipf’s law to gauge their maturity - i.e. are there other deposits that have yet to be found.

A simple rule of thumb would be the 80:20 rule - 80% of the resources are found in just 20% of the deposits or 2-3 big deposits, a few medium-sized, and and loads of tiny ones.

Here are some examples from Davies el al (2018) - reference at bottom of post.

Yilgarn Au deposits

Some massive deposits, quickly dropping down

You can potentially use this plot to see if there are any gaps

Lets return to the Paterson Province



I've plotted on Telfer and Winu against a Zipf curve.

It is very interesting, if this area follows the Zipf curve, we can see that there could be a couple of 2-3Moz Au deposits and maybe 4-5 >1Moz Au deposits lurking around. Lets see how Haverion fits in.

It will also be interesting to see if someone will buy Telfer as Newcrest are open to offers (link)

References

Davies et al (2018) "Entering an immature exploration search space: Assessment of the potential
orogenic gold endowment of the Sandstone Greenstone Belt, Yilgarn Craton,
by application of Zipf’s law and comparison with the adjacent Agnew
Goldfield" in Ore Geology Reviews Volume 94, March 2018, Pages 326-350

Pretium - Brucejack production

So why should bad news be spread over a single post, we looked at the 'improved' resources, so now let us look at the mine production figures

Pretium have done an excellent job with the mill upgrade
 

It has been consistently producing 5-10% above nameplate capacity, and they ramped up throughput to 3800 tpd on schedule.

Recovery is still excellent:

However, we see that mined grade is still way off the original Feasibility Study, approximately half that calculated by Tetratech.

 Understandably, this has had a massive knock-on effect to the Au production.

We can see that it is way off, but why don't we plot on the latest reserve grades.

You can see now that the new reserve grades is very close to the actual mine grades. It will be interesting to see of they can keep at this level.

It will be interesting to see if Tetra Tech or Snowdon have any comments on why their 2013 and 2019 resource calculations were so different to mine production and latest resource estimates.

Pretium - Getting back into the swing of things

Sorry I've been away for so long, I've been working on a large project that has taken up all of my free time.

I'm going to run through a few old projects, just to get up to speed

1st up, that old favorite, Pretium Resources, we've had a lot of good times at Brucejack

• A resource update (link)
• 2019 operations update (link)
• CEO resigning (link)

Let us first look at the updated resources!

TLDR version

What a fucking disaster!

Long version

We'll start with the good news

Tonnage went up, apart from a small decrease in reserves!

That's it, everything else was a disaster!

Grade

A massive decrease, the latest resources are virtually half that in the original PEA

Almost exactly the same grade as the original resources calculated in 2013

Contained Gold

This has given a small, 3Moz decrease in contained gold