Paramount Mining Corporation’s (ASX: PCP) 85%-owned Indonesian subsidiary, PT Paramindo, has finalised the acquisition of an initial 10% equity interest in the Gunung Rosa gold project in West Java.
The company is focused on rapid development of the project, which compares favourably to Kingsrose Mining’s (ASX: KRM) Way Linggo Project in South Sumatra, which had a starting base of less than 200,000 ounces of gold resources.
Chief executive officer Terry Holohan said today’s announcement marks the first step of the agreed 85% purchase of the project by Paramindo, and has triggered the re-development of the existing mine using more efficient mining practices with modern metallurgical processes.
“The engineers and geologists can now focus all their efforts on the delineation of the orebody, metallurgical testwork and the design of both a trial mining as well as a full scale mining operation,” he said.
Early trial mining will extract mineralised wall rock left behind by poor early mining practices in the upper levels while, in parallel, new unmined high grade areas below will be developed for full production.
Gunung Rosa has a historical JORC Resource of 799,348 tonnes at 13.96 grams per tonne (g/t) gold and 3.38% zinc for 358,832 ounces of contained gold and 26,998 tonnes of zinc.
It also contains Proved and Probable Reserves of 400,000 tonnes at 11.4g/t gold and 3.03% zinc for 146,690 ounces of contained gold and 12,130 tonnes of zinc.
The recognised mineralisation occurs in steeply dipping mesothermal veins in excess of 2 kilometres in strike length contained within structures.
A new drilling program has confirmed the extension of mineralisation to 200-250 metres from surface, with the mineralisation remaining open at depth.
An earlier 13-hole due diligence drilling program intersected a broad width of 18.3 metres at 3.57g/t gold, 4.22g/t silver and 0.4% copper. Importantly, all holes drilled in that program intersected the vein system.
Paramount is now following up due diligence drilling with a three hole drilling program.
In addition to drilling, a detailed helicopter-borne aeromagnetic survey is scheduled for completion later this month.
The survey will help define new exploration targets and define the alteration that hosts the main mineralised vein.
Acquisition Settlement
Paramindo acquired the initial 10% equity interest by paying PT Cikondang Kancana Prima US$1 million (A$945,151) in staged payments since it entered the agreement in early August last year.