KGL Resources hits more massive sulphides at Jervois
KGL Resources' (ASX: KGL) has discovered more massive sulphides at the Jervois copper-silver-gold project in the Northern Territory.
Diamond drilling at the Marshall-Reward deposit delivered: (KJCD045) 8 metres wide, 6.65% copper equivalent, zone of massive and semi‐massive sulphide containing visible copper, lead and zinc sulphide mineralisation.
Hole KJCD048 delivered: 57 metre extension of the 18 metre high grade zone in Marshall Reward with lower grade, 1.26% copper equivalent, mineralisation in the footwall.
Results from the end of 2013 include (KJCD048): 18 metres at 0.88% copper, 19.63% lead, 3.77% zinc, 732.3g/t silver, 0.61g/t gold from 287 metres, including 9 metres at 1.48% copper, 22.08% lead, 3.07% zinc, 740g/t silver, 0.53g/t gold.
This increased the Copper Equivalent for KJCD048 to 11.3%.
Adding to the prospectivity of the area, the Marshall Reward deposit continues to be open along strike and down dip.
Simon Milroy, managing director, commented: “We are planning to complete a surface and downhole Electromagnetic survey in February to assist in defining the limits of the high grade zone for targeting further drilling.”
Cashed up KGL trades under cash backing
KGL Resources had $7.8 million in cash at the end of December 2013, and is currently completing the sale of the Murchison gold project for $15 million.
This provides a cash balance of over $22 million, and with 140 million shares on issue, this provides a cash backing of $0.157 per share, which is well above the $0.125 last traded price.
KGL's current valuation therefore doesn't even include Jervois, further highlighting the undervaluation of the company.
In hole KJCD045 the massive galena mineralisation has a very sharp contact at the hanging wall and appears to replace a limestone unit within mudstones, siltstones and schists.
KGL said that it appears to be a distinct style of mineralisation adjacent to the more common Marshall-Reward style copper mineralisation that was intersected higher up in the hole.
The limestone has been altered to a carbonate-magnetite rock containing sphalerite and pyrite. Assays for the remainder of the diamond core in KJCD048 have also been received and highlight a 75 metre zone of mineralisation.
This includes a 57 metre zone of lower grade mineralisation, 1.26% copper equivalent, in the foot wall to the previously announced 18 metre high grade zone.
Metallurgical recoveries assumed are based on results of metallurgical test work commissioned by KGL Resources on the Jervois deposits and metallurgical performance of similar deposits from the AMEC database.
Metallurgical test work to date has demonstrated that a 93% recovery of copper to a 26% copper concentrate is achievable though in the calculation of copper equivalent 100% of the contained copper is used.
It is the company’s opinion that all of the elements included in the metal equivalent calculation have a reasonable potential to be recovered and sold.
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