Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX:
MND, OTCQB: MNDJF) is pleased to announce the commencement of its
2019 exploration campaign at its Costerfield operation in Victoria,
Australia, as well as its Björkdal operation in Sweden. The Company
is also pleased to report additional diamond drilling results from
both operations based on drilling that was carried out since the
Company’s last exploration release on November 14, 2018. Readers
are advised to review the corresponding figures found at the end of
this press release.
Mandalay’s drilling programs since the fourth
quarter of 2018 have continued to yield encouraging results. At
Costerfield, the Company is testing extensions to the Youle orebody
(see tables 1 and 2) and has commenced a deep drilling program
under the known Costerfield mineral systems to test for potential
high-grade mineralization similar to Fosterville’s Swan zone. At
Björkdal, the Company has expanded the Aurora mineralization, and
in addition is pleased to provide drilling results for newly
discovered high-grade skarn at the Lake zone (see tables 3, 4, and
5).
Dominic Duffy, President and CEO of Mandalay,
commented, “We are pleased to announce that we have commenced our
2019 exploration programs at both of our sites. We believe that the
most recent drilling results at Costerfield and Björkdal are very
positive and suggest further opportunities for increasing the value
of our operations.
“At Costerfield, we commenced drilling to test
the northern extension of the high-grade Youle lode in May 2019 and
met with immediate success in the first hole (BC068), which
intercepted 0.5 metres (true width) at 39 grams per tonne of gold
equivalent. This result is encouraging as it gives us increased
confidence about the continuity of Youle to the north. Currently,
the Youle lode is open to extension in all directions. We expect to
commence mining of this high-grade lode in the fourth quarter of
this year, with the opportunity for further expansion from
underground drill platforms when we get there.”
Mr. Duffy continued, “We also began phase one of
our deep drilling program at Costerfield in May 2019. This is the
first phase of a program that is expected to continue over the
coming twelve months. The objective of the first phase of deep
drilling is to establish the geological and stratigraphic context
for where a high-grade gold deposit would likely be found. We have
begun the first of two deep holes (approximately 1,000 metres deep
and 1,500 metres hole length) and we will be wedging off of each
hole to get a clearer picture of the structural setting further up
dip. We believe this program will provide a strong framework for
understanding the geology and potential styles of mineralization
that may exist at depth, to allow planning of the future deep
drilling program.”
Mr. Duffy concluded, “At Björkdal, drilling at
the Aurora zone in the fourth quarter of 2018, together with
further drilling in the second quarter of 2019, has continued to
expand the size of the deposit, which is still open both vertically
and along strike. Aurora currently measures 500 metres in strike
length and 300 metres in height with significantly larger widths
than we are currently mining. In addition to further delineating
Aurora, we are pleased to also announce high-grade drill results
from the newly discovered Lake zone skarn deposit. The skarn
deposit adds a new dimension to the Björkdal by reporting
significantly higher grades than are typically mined at the
operation.”
Mandalay Drilling Programs
Costerfield Drilling
Programs
Mandalay initiated two exploration programs at
Costerfield in May 2019.
Youle Extension Drilling Program
The current drilling program at Costerfield is
targeting the northern extension of the high-grade Youle lode. The
Company has planned a total of 12 holes for 6,260 metres (“m”) and
is focused on extending Youle, which the Company expects to begin
production from in the fourth quarter of 2019. This extensional
program is scheduled to be completed in September 2019 and is
expected to expand on the Company’s 2019 Mineral Reserves and
Resources update planned for release in early 2020 (see figure
1).
Deep Drilling Program
The second Costerfield program is the
commencement of exploration in the environment deep below the known
Costerfield mineral system. This deep drilling program aims to
assess the potential for substantial discoveries to be made at the
convergence of the downward trend of the known, gold-mineralized
structural corridor containing the Costerfield orebodies with a
predicted favourable litho-geochemical environment at depth (see
figures 1 and 2).
The Company began drilling the first of two
wedged holes in the deep drilling program in May 2019. Hole CD001
is targeting the down dip environment of the Youle lode, below the
Costerfield mineralized system (see figure 2) and the second hole
CD002 is testing down dip of the previously mined Augusta/Cuffley
zones. A total of 4,700 m of drilling is planned from surface and
will provide detailed information on the potential of targeting
significant high-grade gold.
Björkdal Drilling Programs
Underground extensional and production drilling
during late 2018 and early 2019 has shown that mineralization
within the Aurora zone remains open in all directions (see figures
3, 4, and 5). The Aurora zone is located above a marble contact,
which has historically been considered the hangingwall to the
mineralization at Björkdal. The increased size and continuity of
mineralization that is being realized at Aurora provides the
Company with the potential to mine high-tonnage and higher-grade
ore more cost effectively over the coming years.
Aurora Drilling ProgramThe Company’s current
drilling efforts are focused on exploring the upper extension of
mineralization of the Aurora zone with the objective of testing the
grade and continuity of the Aurora vein system close to the
surface. In addition to the near-surface environment, we continue
to test the depth potential of the Aurora zone.
Lake Zone Skarn Program
Drilling carried out in 2017 and 2018 confirmed
the existence of a high-grade skarn deposit developed at the
intersection of the Björkdal shear and marble, in the Lake zone
north area (see figures 4, 6, and 7). The area consists of a 10 m
thick, lenticular body, which dips NNE at ~35 degrees, with a
currently known strike length of approximately 60 m. The area is
consistently delivering high grades, in excess of 5 g/t gold but is
currently limited in size. The discovery of high-grade skarn at
Björkdal provides both a valuable blending opportunity through the
mill and a new ore type to explore for at the hangingwall contact
of the marble unit.
The Company is now testing the down-dip
extension of skarn mineralization. The skarn is currently being
developed in the underground mine and the Company is planning to
optimize the mining of this area, with further development levels
planned at depth.
Mandalay Drilling Results
Costerfield Drilling
Results
Youle
Table 1: Youle (Costerfield) Drilling Highlights
HoleNumber |
True Width(m) |
Gold(g/t) |
Antimony(%) |
AuEq (g/t) over minimumdiluted mining width of 1.8
m |
BC068 |
0.50 |
133.7 |
5.4 |
39.4 |
BC065A |
0.74 |
23.4 |
20.4 |
24.0 |
BC066 |
1.62 |
4.2 |
6.7 |
14.1 |
BC062 |
0.11 |
39.3 |
27.3 |
5.0 |
From December 2018 to June 2019, the Company drilled 8 holes
into the southern end of Youle where production is expected to
start on the vein. This program yielded promising results. In
particular, hole BC065A, which contained 23.4 g/t gold and 20.36%
antimony over a vein width of 0.74 m (see tables 1 and 2).
Mandalay also recently commenced surface
drilling on the Youle northern extension and infill program. The
first drill hole, BC068, intercepted visible gold and an assay of
0.496 m (True width) at 133.66 g/t gold and 5.4% antimony. In late
2018, the Company drilled some closer-spaced holes in the area
where production on Youle is expected to commence. Drilling details
for both of these programs at Youle are listed in table 2 and shown
on figure 1.
Table 2: Youle Drilling Results (Nov 2018 – June 2019)
HoleNumber |
HoleCompletionDate |
Total Hole Depth |
InterceptEasting(MineGrid) |
InterceptNorthing(Mine Grid) |
InterceptElevation(Mine Grid) |
DrillWidth(m) |
TrueWidth(m) |
GoldGrade(g/t) |
SbGrade(%) |
AuEq(g/t)overmin.1.8
mminingwidth |
BC062 |
30/10/2018 |
410.0 |
15300 |
6815 |
846 |
0.13 |
0.11 |
39.3 |
27.3 |
5.0 |
BC063A |
7/11/2018 |
329.7 |
15374 |
6669 |
970 |
0.59 |
0.46 |
0.4 |
19.2 |
8.5 |
BC063W1 |
13/11/2018 |
110.7 |
15376 |
6665 |
970 |
0.12 |
0.06 |
6.4 |
0.2 |
0.2 |
BC064 |
28/11/2018 |
378.8 |
15378 |
6811 |
929 |
0.20 |
0.18 |
8.0 |
4.9 |
1.6 |
BC064W1 |
2/12/2018 |
99.2 |
15379 |
6810 |
929 |
0.26 |
0.24 |
2.3 |
9.0 |
2.3 |
BC065A |
16/12/2018 |
357.1 |
15383 |
6765 |
934 |
0.77 |
0.74 |
23.4 |
20.4 |
24.0 |
BC066 |
9/1/2019 |
340.0 |
15382 |
6706 |
945 |
2.69 |
1.62 |
4.2 |
6.7 |
14.1 |
BC068 |
6/6/2019 |
428.2 |
15395 |
7136 |
827 |
1.45 |
0.50 |
133.7 |
5.4 |
39.4 |
Björkdal Drilling Results
Since the Company’s last exploration press
release on November 14, 2018, the Company has assayed 23 drill
holes at the Aurora zone at Björkdal (see tables 3 and 5) and 9
drill holes at its Lake zone skarn deposit (see table 4). Recent
highlights from the Aurora and Lake zone skarn assays include the
following intercepts:
Table 3: Aurora Drilling Highlights:
Hole Number |
True Width (m) |
Gold (g/t) |
DOD2018-171 |
3.28 |
6.02 |
DOD2018-170 |
4.84 |
5.76 |
MU8-031 |
6.57 |
2.91 |
DOD2019-004 |
5.96 |
2.58 |
MU8-044 |
5.25 |
2.55 |
Table 4: Lake Zone Skarn Drilling Highlights:
Hole Number |
True Width (m) |
Gold (g/t) |
DOD2018-154 |
8.7 |
39.69 |
DOD2018-157 |
7.5 |
26.34 |
DOD2018-147 |
4.7 |
21.41 |
DOD2018-159 |
3.2 |
20.65 |
MU7-037 |
6.2 |
19.35 |
DOD2018-155 |
6.2 |
9.03 |
DOD2018-150 |
3.5 |
7.86 |
DOD2018-142 |
4.0 |
5.53 |
DOD2018-151 |
7.3 |
5.48 |
Table 5: Aurora Drilling Results (Nov 2018 –
June 2019)
Hole Id |
HoleCompletionDate |
InterceptNorthing(Mine Grid) |
Intercept Easting
(Mine Grid) |
Intercept Elevation(Mine Grid) |
From(m) |
To(m) |
DrilledWidth(m) |
TrueWidth(m) |
Au(g/t) |
AuEq min. 3
mminingwidth(g/t) |
DOD2018-125 |
30/6/2018 |
1792.1 |
1422 |
-414.7 |
101.2 |
102.7 |
1.50 |
1.22 |
3.32 |
1.35 |
DOD2018-170 |
3/10/2018 |
1833.425 |
1302.148 |
-507.167 |
156.8 |
164.95 |
8.15 |
4.84 |
5.76 |
5.76 |
DOD2018-171 |
29/11/2018 |
1727.549 |
1244.596 |
-335.504 |
140.5 |
144.35 |
3.85 |
3.28 |
6.02 |
6.02 |
DOD2018-172 |
26/11/2018 |
1732.919 |
1290.876 |
-334.359 |
124.3 |
132.65 |
8.35 |
8.09 |
0.60 |
0.60 |
DOD2018-173 |
21/11/2018 |
1738.793 |
1333.414 |
-337.329 |
124.95 |
131.74 |
6.79 |
6.73 |
1.09 |
1.09 |
DOD2019-002 |
25/1/2019 |
1757.972 |
1401.442 |
-368.481 |
131.2 |
135.9 |
4.70 |
4.42 |
1.03 |
1.03 |
DOD2019-004 |
5/2/2019 |
1758.264 |
1356.219 |
-365.347 |
123.9 |
129.9 |
6.00 |
5.96 |
2.58 |
2.58 |
DOD2019-005 |
9/2/2019 |
1747.208 |
1355.578 |
-340.234 |
121.2 |
125.25 |
4.05 |
4.04 |
1.39 |
1.39 |
DOD2019-008 |
27/2/2019 |
1717.106 |
1197.64 |
-359.762 |
148 |
152.9 |
4.90 |
4.13 |
1.07 |
1.07 |
DOD2019-009 |
12/3/2019 |
1708.342 |
1168.235 |
-375.343 |
157.2 |
161.35 |
4.15 |
3.45 |
0.59 |
0.59 |
DOD2019-010 |
18/3/2019 |
1701.362 |
1179.117 |
-343.969 |
152.1 |
155.57 |
3.47 |
3.26 |
0.63 |
0.63 |
DOD2019-011 |
5/3/2019 |
1685.44 |
1220.397 |
-328.511 |
120.5 |
123.65 |
3.15 |
2.63 |
0.86 |
0.75 |
DOD2019-019 |
15/2/2019 |
1757.627 |
1305.934 |
-372.272 |
135.38 |
141.2 |
5.82 |
5.33 |
1.06 |
1.06 |
DOD2019-016 |
1/4/2019 |
1174.4 |
1773.1 |
-440.4 |
54.55 |
66.6 |
12.05 |
7.62 |
2.18 |
2.18 |
DOD2019-018 |
4/4/2019 |
1161.7 |
1797.7 |
-474.9 |
86.45 |
89 |
2.55 |
1.36 |
1.20 |
0.54 |
MU8-028 |
1/11/2018 |
1825.994 |
1484.187 |
-481.8 |
115.35 |
118.35 |
3.00 |
2.14 |
2.01 |
1.43 |
MU8-029 |
8/11/2018 |
1807.583 |
1454.638 |
-445.256 |
82.8 |
95.51 |
12.71 |
11.68 |
1.20 |
1.20 |
MU8-030 |
13/11/2018 |
1843.077 |
1456.362 |
-523.694 |
136.3 |
153.1 |
16.80 |
11.02 |
1.54 |
1.54 |
MU8-031 |
23/11/2018 |
1872.032 |
1412.031 |
-583.962 |
195.85 |
210 |
14.15 |
6.57 |
2.91 |
2.91 |
MU8-032 |
30/11/2018 |
1885.6 |
1315 |
-600.3 |
231.55 |
237.95 |
6.40 |
3.13 |
1.33 |
1.33 |
MU8-034 |
6/10/2018 |
1786.5 |
1453.7 |
-400.5 |
106.45 |
108.1 |
1.65 |
1.37 |
1.85 |
0.84 |
MU8-042 |
16/10/2018 |
1778.543 |
1144.862 |
-449.336 |
100.1 |
102.15 |
2.05 |
1.43 |
2.02 |
0.97 |
MU8-043 |
20/10/2018 |
1795.589 |
1114.167 |
-482.151 |
134.72 |
137.28 |
2.56 |
1.52 |
0.30 |
0.15 |
MU8-044 |
8/12/2018 |
1886.488 |
1470.366 |
-608.106 |
225.5 |
237.95 |
12.45 |
5.25 |
2.55 |
2.55 |
Optimization of Björkdal
Operation
In addition to the exploration update, Mandalay
also announced today changes to its Björkdal gold mine in northern
Sweden. Due to major improvements to the Company’s underground
haulage capacity, Mandalay, after careful consideration, has taken
the opportunity to shift to a lower-cost operating strategy at
Björkdal. Effective at the end of July 2019, the Company will pause
open pit mining at the site and will take advantage of producing
from its highest-margin and highest-grade ore source, which comes
from the underground area of the mine. The Company will supplement
underground ore production from a 2.7 million tonne ore stockpile
that has already been mined and is on surface near to the mill.
This decision is based on the Company focusing on generating
improved cost margins and cash flow from Björkdal. The current
capacity of the mill at Björkdal is 1.3 million tonnes per year and
the Company expects to produce over 800,000 tonnes of ore per year
from underground, and 500,000 tonnes of stockpiled material per
year. The Company anticipates restarting the open pit following the
depletion of the stockpiled material.
Mandalay does not expect that this shift in
strategy to reduce operating and capital costs at the operation
will impact its previous production guidance for 2019.
Björkdal currently employs over 225 personnel.
All Mandalay employees currently working within the open pit
operation will be given an opportunity to move into other site
roles. The current open pit contractor, Swerock AB, will continue
with the underground transport contract.
Dominic Duffy, President and CEO of Mandalay,
commented, “The change of focus to pause the open pit and
substitute the ore from the stockpile material currently on surface
allows the Company to take advantage of the higher-margin material,
as we aim to improve our cash flow from the operation without
having any significant impact on the overall ounce production.”
A photo accompanying this announcement is available
at:https://www.globenewswire.com/NewsRoom/AttachmentNg/5a63b682-f88a-4d0d-90cc-bef4c902c783
https://www.globenewswire.com/NewsRoom/AttachmentNg/31456141-2774-49d6-b839-5644d1e76ef8
https://www.globenewswire.com/NewsRoom/AttachmentNg/9fb666e1-ded6-4b94-a836-d249fac562d7
https://www.globenewswire.com/NewsRoom/AttachmentNg/845a4b58-9eec-4758-b5c6-c30ea60d2788
https://www.globenewswire.com/NewsRoom/AttachmentNg/4b50e499-76ca-4ad5-9e62-beb10a2ced36
https://www.globenewswire.com/NewsRoom/AttachmentNg/8a99446d-1fc2-4e0f-9cd1-4dc0a06b386f
https://www.globenewswire.com/NewsRoom/AttachmentNg/1396325b-41da-476e-b07f-a485882e03a8
https://www.globenewswire.com/NewsRoom/AttachmentNg/17c85c0c-1f90-4298-ad72-d55cb0b62044
Drilling and Assaying
At Costerfield, diamond drill core was logged
and sampled by Costerfield geologists. All samples were sent to
OnSite Laboratory Services in Bendigo, Victoria, Australia, for
sample preparation and assay. Site geological and metallurgical
personnel have implemented a QA/QC process that includes the
regular submission of standard reference materials and blanks with
drill and face samples submitted for assay. Standard reference
materials have been certified by Geostats Pty Ltd. (February 6,
2019 Technical Report entitled “Costerfield Operation, Victoria,
Australia NI 43-101 Report”, available on SEDAR (www.sedar.com),
which contains a complete description of drilling, sampling, and
assaying procedures).
At Björkdal, all diamond drill core was logged
and sampled by Björkdal geologists. Exploration drill hole samples
(prefix MU) were sent to CRS Minlab Oy (CRS) in Kempele, Finland
for sample preparation and assaying. Development Optimization drill
hole samples (prefix DOD) were at the onsite lab ran by ALS for
sample preparation and assaying (see March 28, 2019, Technical
Report entitled “Technical Report on the Björkdal Gold Mine,
Sweden”, available on SEDAR (www.sedar.com), which contains a
complete description of drilling, sampling, and assaying
procedures).
Assaying in both the CRS and ALS laboratories
was conducted utilizing the Pal1000 (CRS) cyanide leaching
processes. Mandalay’s rigorous QA/QC program included the use of
standard reference samples, blanks, duplicates, repeats, and
internal laboratory quality assurance procedures.
Qualified Person:
Chris Gregory, Vice President of Operational
Geology and Exploration at Mandalay Resources, is a Member of the
Australian Institute of Geoscientists (AIG), and a Qualified Person
as defined by NI 43-101. He has reviewed and approved the technical
and scientific information provided in this release.
For Further Information
Dominic DuffyPresident and Chief Executive
Officer
Greg DiTomaso Director of Investor Relations
Contact: 647.260.1566
About Mandalay Resources Corporation
Mandalay Resources is a Canadian-based natural
resource company with producing assets in Australia and Sweden, and
care and maintenance and development projects in Chile. The Company
is focused on growing production at its gold and antimony operation
in Australia, and gold production from its operation in Sweden to
generate near term cash flow.
Forward-Looking Statements:
This news release contains "forward-looking
statements" within the meaning of applicable securities laws,
including statements regarding the exploration and development
potential of the Youle deposit (Costerfield) and the Aurora Zone
(Björkdal). Readers are cautioned not to place undue reliance on
forward-looking statements. Actual results and developments may
differ materially from those contemplated by these statements
depending on, among other things, changes in commodity prices and
general market and economic conditions. The factors identified
above are not intended to represent a complete list of the factors
that could affect Mandalay. A description of additional risks that
could result in actual results and developments differing from
those contemplated by forward-looking statements in this news
release can be found under the heading “Risk Factors” in Mandalay’s
annual information form dated March 28, 2019, a copy of which is
available under Mandalay’s profile at www.sedar.com. In addition,
there can be no assurance that any inferred resources that are
discovered as a result of additional drilling will ever be upgraded
to proven or probable reserves. Although Mandalay has attempted to
identify important factors that could cause actual actions, events
or results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements.
Mandalay Resources (TSX:MND)
Historical Stock Chart
From Aug 2024 to Sep 2024
Mandalay Resources (TSX:MND)
Historical Stock Chart
From Sep 2023 to Sep 2024