Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX:
MND, OTCQB: MNDJF) is pleased to present an update on the
continuing exploration programs 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 June 18, 2019.
Readers are advised to review the corresponding figures found at
the end of this press release.
Exploration Update
Highlights
Costerfield
- Youle northern extensional drilling met with early success
- Potential for further discovery at Costerfield with target test
drilling from surface at MacDonald
- First hole of Costerfield deep drilling completed at 1,700
metres (“m”). Program has advanced knowledge of the structural
framework of the Costerfield mineral district. Commenced a
shallower daughter hole allowing for exploration target
testing
Björkdal
- Aurora zone open to extension. Assay results continue to grow
the potential resource
- Drill results at newly discovered Lake Zone skarn deposit
demonstrated that the skarn geology is continuing deeper.
Mandalay’s drilling programs have continued to
yield encouraging results at both Costerfield and Björkdal
operations. At Costerfield, the Company is testing extensions to
the Youle orebody, (see table 1) and has completed the first hole
of a deep drilling program under the known Costerfield mineralized
system, in search of high-grade mineralization at depth. At
Björkdal, the Company is testing up-dip and down-dip extensions to
the Aurora mineralization and is also testing the down-dip
extension of the newly discovered high-grade skarn at Lake zone
(see tables 2, 3, 4, and 5).
Dominic Duffy, President and CEO of Mandalay,
commented; “Recent drilling results at Costerfield and Björkdal
continue to demonstrate the significant upside value potential of
our operations.”
“At Costerfield, further testing of the northern
extension of the high-grade Youle deposit is strengthening our
confidence of grade continuity within the Inferred Resources.
Additionally, drilling further north of the Youle line of lode
resulted in the identification of continuous mineralization through
a low-grade zone, along with indications of a higher-grade zone of
antimony and gold concentration approximately 200 metres away from
the existing Youle Inferred Resources at a target known as
MacDonald.”
Mr. Duffy continued, “We are now well underway
with phase 1 of our deep drilling program at Costerfield. The first
deep hole was completed at a depth of 1,700 metres and has provided
valuable structural information below the Costerfield and Youle
deposits. One high potential target has already been generated
further up-dip as a result of this first hole. A daughter hole will
now be wedged off the parent hole to test this target.
Multi-element geochemical assaying of core drilled through
potential fluid conduits is currently underway, with geochemical
vectoring techniques to be applied once the analysis is
complete.”
Mr. Duffy concluded, “At Björkdal, drilling at
the Aurora zone was not able to commence until May 2019. However,
results demonstrated that Aurora is still open both vertically and
along strike. Lastly, we commenced testing the down-dip extension
of the newly discovered Lake Zone skarn deposit. Results to date,
show that the skarn geology continues deeper, but further assay
results are required before assessing to what depth this deposit
economically extends.”
Mandalay Drilling Programs
Costerfield Drilling Programs
Mandalay continues its two exploration programs commenced in May
2019.
Youle Extension Drilling Program
The focus of the Youle extension program has
been to delineate a complex high-grade zone to the north, expanding
on the early success of the program reported in June 2019.
With the use of regional modelling, historic
research, and structural information gained from the second quarter
of 2019 drilling program, an additional package of gold and
antimony concentration was interpreted to exist as a target north
of a low-grade zone along the structural trend of Youle and the
Main Costerfield mine. As a result, the Youle extension drilling
was re-designed to prioritize drill testing of this zone and has
met with initial success (refer to Drilling Results, Figure 1 and
Table 1 for details).
This “shoot repetition” has now been observed
multiple times through the district, most notably in the Cuffley,
Brunswick and Augusta Deposits.
Costerfield Deep Drilling Program
As Mandalay continues to increase momentum
within the Youle expansion program, it also advances deep targeted
testing of the Costerfield line of lode following Mandalay’s
developing understanding of gold enrichment environments. The first
hole of this two-hole program with secondary wedge holes, has been
completed at a depth of 1,700 m. This first hole was designed to
investigate the deep environment at the northern end of the current
mine area, below the historical Costerfield mine and the currently
active Youle lode.
Björkdal Drilling Programs
Underground extensional and production drilling
during 2019 has continued to focus on the high-grade mineralization
recently discovered at Björkdal (i.e., Aurora Zone and Lake Zone
skarn). Both these horizons provide the Company with the potential
to mine high-tonnage and higher-grade ore more cost effectively
over the upcoming years.
Aurora Drilling Program
Underground drilling focused on extending the
existing Aurora zone. Results to date confirm the potential for
Aurora to be extended both up and down dip and along strike in both
directions. Although drilling the upper section of Aurora has
encountered problems due to the difficult nature of drilling
positive gradient diamond drill holes, with several holes having to
be abandoned when intercepting major faults before intercepting the
Aurora zone. As a result, the focus of Aurora drilling has been
changed to the deeper holes seeking to extend the higher-grade
mineralization at depth. The upper holes will now be drilled from
surface in later 2019 or early 2020. The zone is currently being
mined on five active levels.
Lake Zone Skarn Program
The recognition of skarn related mineralization
at Björkdal during 2018 is of interest due to its anomalously high
grade. Seven diamond drill holes have recently been drilled with
the aim to define the down dip extension of the mineralized body.
These drill holes have demonstrated the continuation of the
skarnified horizon further to the north and at depth.
Mandalay Drilling Results
Costerfield Drilling Results
Youle Extension Drilling Program
Drill hole BC071 has been completed, targeting
the multiple veins that make up the northern high-grade area of
Youle. This hole intercepted multiple parallel veins, with the most
significant being 18.4 g/t gold (“Au”) and 5.7% antimony (“Sb”)
over a true width of 0.24 m.
Other recent drilling within the program focused
on testing for a northern continuation of mineralization. The
structure that hosts the majority of Youle mineralization was
intercepted in BC067AW1, BC067AW2 and BC070 with the structure
being enriched in gold and antimony in all 3 intercepts.
Historic research, together with field mapping
and LiDAR (light imaging, detection, and ranging) analysis has
identified substantial workings along the line of the historic
Costerfield mine to the north. From our understanding of the other
mineralized packages in the district, a steeply plunging low-grade
zone occurring between these workings and the Costerfield mine is
likely, and fits with observations and inferences of bedding and
faulting interactions to the north of Youle and Costerfield. From
these findings a highly prospective zone now exists north of
Costerfield mine, being the MacDonald target.
BC075 intercepted two mineralized zones. A gold
and antimony bearing laminated quartz vein (0.42 m @ 7.2 g/t Au
& 4.4% Sb), which is spatially associated with the historic
workings, and additional quartz-stibnite veining (0.45 m @ 1.3 g/t
Au & 7.3% Sb composite of multiple veins) approximately
80 m to the east of the initial intercept. These results support
the northern enrichment model and excitingly indicate a potential
for multiple veining and mining fronts.
Table 1: Youle Drilling Results (June 2019 – September
2019)
Hole ID |
Hole Completion Date |
Total hole Depth |
Intercept Easting (Mine Grid) |
Intercept Northing (Mine Grid) |
Intercept Elevation (Mine Grid) |
Drilled Width (m) |
True Width (m) |
Au Grade (g/t) |
Sb Grade (%) |
AuEq (g/t) over min. 1.8m mining width |
BC067AW1 |
4/07/2019 |
531.2 |
15441 |
7251 |
817 |
0.09 |
0.07 |
8.7 |
19.8 |
1.4 |
BC067AW2 |
17/07/2019 |
518.9 |
15406 |
7235 |
799 |
0.08 |
0.07 |
5.3 |
8.6 |
0.7 |
BC069 |
27/06/2019 |
699.6 |
No Significant Intercept |
BC070 |
9/08/2019 |
734.8 |
15442 |
7350 |
747 |
0.31 |
0.22 |
0.8 |
0.5 |
0.2 |
BC071 |
5/08/2019 |
492.1 |
15392 |
7156 |
849 |
0.55 |
0.26 |
18.4 |
5.7 |
3.9 |
BC071 |
5/08/2019 |
492.1 |
15389 |
7156 |
854 |
0.28 |
0.20 |
2.1 |
3.4 |
0.8 |
BC075 |
10/09/2019 |
357.5 |
15521 |
7439 |
1122 |
0.51 |
0.42 |
7.2 |
4.4 |
3.2 |
BC075 |
10/09/2019 |
357.5 |
15608 |
7356 |
1048 |
0.52 |
0.45 |
1.3 |
7.3 |
3.1 |
Note: - Assumes metal prices of: Au$1,450/ oz and Sb$7,000/ t-
AuEq (g/t) = Au (g) + Sb (%) x [Price per 10 Sb (kg) x Sb Recovery
(%) / Price per 1 Au (g) x Au Recovery (%)]
Costerfield Deep Drilling Program
The upper majority of the first hole in this
program (CD001) found a geological environment consistent with our
current understanding; a west-dipping sequence of Upper Costerfield
Formation siltstones passing into the turbidites and mudstones of
the Lower Costerfield Formation. As anticipated by the geological
model, a sequence of dark, carbon-rich turbidites and sandstones
inferred to be favorable to high-grade gold mineralization was
passed through between 904 – 995 m, which included quartz veining
with anomalous gold values (up to 0.7 g/t Au) and minor visible
stibnite mineralization (up to 0.01% Sb).
At a downhole depth of 1,015 m, a west-dipping
fault containing laminated quartz with significant apparent thrust
offset was intercepted (Figure 2). Below this fault, folded but
predominantly east-dipping turbidites, giving way to siltstones
disrupted by apparent strike-slip faulting was encountered. A large
fault between 1,545 and 1,555 m marked a transition into
dark-coloured, east-dipping slaty turbidites which displayed
abundant irregular quartz veining leading up to a thick quartz blow
between 1,583 – 1,595 m. This wide interval of quartz contained
minor pyrite mineralization and zones of sericite-chlorite
alteration.
Stratigraphic correlations between the Youle
mine area, and the first 1,000 m of CD001 infer the existence of an
anticlinal environment or thrust ramp in the area between, which
presents a compelling target for Costerfield-style mineralization
down-dip of the known Youle lode. This environment is additionally,
likely to be coincident with the occurrence of the dark carbon-rich
sandstones which enhance the potential for high-grade gold
mineralization.
Trace-level analysis assays have been returned
for the core down to a depth of 1,040 m, which display strong
positive correlation between gold, antimony and arsenic (Figure 3).
Of importance is a wide zone of enrichment of these elements,
approximately between 975 – 1,040 m downhole, which appears to be
centered on the large fault at 1,015 m. Additionally, silver (“Ag”)
shows a strong relative enrichment in this zone on the footwall of
the fault. Subsequent hyperspectral logging of CD001 has
additionally brought to light a wide envelope of muscovite
alteration surrounding this fault, mirroring the elevated assays.
Muscovite alteration of wall rock white micas is a common feature
of central Victorian gold deposits, and the coincidence of
muscovite alteration and gold-antimony-arsenic enrichment here is
interpreted as evidence of the large fault acting as an active
conduit or feeder zone for ore-forming hydrothermal fluids. Assays
from CD001 have been added to Mandalay’s regional multi-element
geochemical database, which integrates exploration drill core,
regolith and bedrock assays to fingerprint mineralized systems and
lithological packages in the Costerfield area. The information
contained within the database is constantly updated and used to
refine exploration models which assist in the generation and
testing of new mineralization targets.
The environment passed through in the latter 660
m of CD001 can be interpreted as the disrupted eastern limb of a
regional-scale anticline, the thrust-offset crest of which hosts
the Costerfield mine. This deep, capped-off eastern limb is in a
similar structural position to the sub King Cobra mineralization at
Augusta which contains some exceptionally high-grade gold assays.
The steeply dipping fault at 1,545 m is interpreted to be analogous
to the Lyre Fault which appears to be significant to setting up the
sub King Cobra mineralized environment. Initial assays through this
zone show anomalous gold and antimony however the method of
analysis used, is designed for ore grade analysis and is not
accurate at trace ranges.
The next hole in this program, CD001W1, has
commenced wedging off CD001 at a depth of 400 m to investigate the
carbonaceous sandstones near to their inferred culmination above
the 1,015 m fault, and the environment immediately below (See
Figure 2).
Björkdal Drilling Results
Since the Company’s last exploration press release on June 18,
2019, the Company has assayed 20 drill holes at the Aurora zone at
Björkdal (see tables 4) and 4 drill holes at its Lake Zone skarn
deposit (see table 5). Recent highlights from the Aurora and Lake
Zone skarn assays include the following intercepts:
Table 2: Aurora Drilling Highlights
Hole ID |
True Width |
Au g/t |
DOD2019-058 |
2.93 |
7.80 |
DOD2019-076 |
3.34 |
5.37 |
DOD2019-077 |
2.51 |
7.24 |
DOD2019-078 |
6.03 |
2.78 |
DOD2019-079 |
3.50 |
6.99 |
Table 3: Lake Zone Skarn Drilling Highlights
Hole ID |
True Width |
Au g/t |
MU9-009A |
0.65 |
23.77 |
MU9-014 |
1.65 |
14.31 |
Table 4: Aurora Drilling Results (June 2019 – September
2019)
Hole ID |
Hole Completion Date |
InterceptNorthing(Mine Grid) |
InterceptEasting(Mine Grid) |
InterceptElevation(Mine Grid) |
From (m) |
To(m) |
DrilledWidth(m) |
True Width (m) |
Au (g/t) |
Au (g/t) over min. 3 m mining width |
DOD2019-052 |
06/07/2019 |
1755.778 |
1126.208 |
-402.341 |
120.2 |
125 |
4.8 |
4.45 |
0.74 |
0.74 |
DOD2019-054 |
20/07/2019 |
1751.489 |
1148.12 |
-396.642 |
111.9 |
114.95 |
3.05 |
2.98 |
1.86 |
1.85 |
DOD2019-058 |
07/08/2019 |
1737.463 |
1179.071 |
-373.329 |
81.37 |
84.7 |
3.33 |
2.93 |
7.80 |
7.62 |
DOD2019-062 |
11/08/2019 |
1744.189 |
1202.82 |
-374.002 |
77.16 |
84.74 |
7.58 |
7.37 |
1.20 |
1.20 |
DOD2019-064 |
14/08/2019 |
1745.167 |
1229.26 |
-373.199 |
76.4 |
85 |
8.6 |
8.46 |
1.44 |
1.44 |
DOD2019-065 |
17/08/2019 |
1740.74 |
1247.04 |
-361.376 |
81.65 |
84.6 |
2.95 |
2.78 |
1.13 |
1.05 |
DOD2019-071 |
11/08/2019 |
1743.136 |
1278.844 |
-354.397 |
93.1 |
101.25 |
8.15 |
7.65 |
2.10 |
2.10 |
DOD2019-072 |
17/08/2019 |
1746.972 |
1309.528 |
-355.602 |
92.53 |
95.14 |
2.61 |
2.61 |
0.75 |
0.65 |
DOD2019-073 |
21/08/2019 |
1753.994 |
1371.047 |
-347.596 |
115 |
119 |
4 |
3.51 |
1.25 |
1.25 |
DOD2019-074 |
23/07/2019 |
1754.501 |
1272.581 |
-378.005 |
73.85 |
75.55 |
1.7 |
1.65 |
2.32 |
1.28 |
DOD2019-075 |
27/06/2019 |
1767.642 |
1275.186 |
-399.987 |
78.4 |
82.6 |
4.2 |
4.07 |
1.54 |
1.54 |
DOD2019-076 |
30/06/2019 |
1763.209 |
1290.188 |
-389.498 |
75.15 |
78.5 |
3.35 |
3.34 |
5.37 |
5.37 |
DOD2019-077 |
02/07/2019 |
1773.238 |
1300.484 |
-402.742 |
83.08 |
85.72 |
2.64 |
2.51 |
7.24 |
6.04 |
DOD2019-078 |
20/07/2019 |
1775.85 |
1321.227 |
-399.189 |
81.9 |
88.05 |
6.15 |
6.03 |
2.78 |
2.78 |
DOD2019-079 |
18/07/2019 |
1761.896 |
1321.197 |
-377.872 |
75.45 |
78.97 |
3.52 |
3.50 |
6.99 |
6.99 |
MU9-019 |
08/08/2019 |
1858.279 |
1518.94 |
-529.552 |
150.2 |
158.35 |
8.15 |
5.24 |
1.46 |
1.46 |
MU9-020 |
18/08/2019 |
1887.54 |
1511.106 |
-600.533 |
204.7 |
224.15 |
19.45 |
9.19 |
1.57 |
1.57 |
POD2019-012 |
08/05/2019 |
1806.281 |
1414.745 |
-451.053 |
84.2 |
89 |
4.8 |
4.43 |
0.85 |
0.85 |
POD2019-013 |
11/05/2019 |
1803.162 |
1433.972 |
-446.062 |
78.16 |
85.55 |
7.39 |
7.07 |
1.47 |
1.47 |
POD2019-014 |
16/05/2019 |
1809.44 |
1445.913 |
-451.242 |
82.3 |
95.2 |
12.9 |
12.02 |
1.29 |
1.29 |
Table 5: Skarn Drilling Results (June 2019 – September 2019)
Hole ID |
Hole Completion Date |
InterceptNorthing(Mine Grid) |
InterceptEasting(Mine Grid) |
InterceptElevation(Mine Grid) |
From (m) |
To (m) |
DrilledWidth (m) |
True Width (m) |
Au (g/t) |
Au min. 3m mining width (g/t) |
MU9-009A |
24/06/2019 |
1690.45 |
1586.03 |
-508.33 |
67.65 |
68.95 |
1.3 |
0.65 |
23.77 |
5.15 |
MU9-012 |
04/08/2019 |
1687.81 |
1612.9 |
-507.67 |
69.7 |
72 |
2.3 |
0.95 |
1.32 |
0.42 |
MU9-013 |
09/08/2019 |
1677.41 |
1637.61 |
-504.47 |
72.6 |
77.74 |
5.14 |
1.81 |
1.71 |
1.03 |
MU9-014 |
11/08/2019 |
1659.49 |
1619.51 |
-486.32 |
45.9 |
49.05 |
3.15 |
1.65 |
14.31 |
7.87 |
Figure
1: https://www.globenewswire.com/NewsRoom/AttachmentNg/39ab60c1-8d7f-42e2-ab79-516a1d5bb210
Figure
2: https://www.globenewswire.com/NewsRoom/AttachmentNg/8c0b8412-5a42-4f7e-909e-b3abb449db53
Figure
3: https://www.globenewswire.com/NewsRoom/AttachmentNg/a8c652ef-fb29-4e89-b323-8bbe23d04e0e
Figure
4: https://www.globenewswire.com/NewsRoom/AttachmentNg/0f63fdbb-b97f-4d19-9eeb-d23dc7671c53
Figure
5: https://www.globenewswire.com/NewsRoom/AttachmentNg/e281e025-2510-4f37-8c1e-83a9a4f35eb4
Figure
6: https://www.globenewswire.com/NewsRoom/AttachmentNg/bbf6894d-06c9-407e-86c3-d35d144fa1b7
Figure
7: https://www.globenewswire.com/NewsRoom/AttachmentNg/c570f17a-6077-415e-84fa-88bb51828bb5
Figure
8: https://www.globenewswire.com/NewsRoom/AttachmentNg/11e72bf7-c85a-4367-b770-6d09258bca45
Figure
9: https://www.globenewswire.com/NewsRoom/AttachmentNg/8fec8d46-d7a3-42d9-ac1e-a9bfd628f608
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
Edison NguyenManager, Analytics and 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.
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