Tasmanian focussed Shree Minerals (ASX: SHH) has added a potential one million ounce gold project to its hematite and magnetite project at Nelson Bay River.
Shree commissioned Hellman & Schofield to undertake a data compilation and review of all available information on, and around the Sulphide Creek tenement (EL43/2004) in Tasmania to evaluate the area’s potential for gold mineralisation.
This followed drilling by Shree on the Sulphide Creek tenements in 2010, which yielded encouraging results.
These included gold intersections that returned: 18.5 metres at 0.5g/t gold including 3 metres at 1.26g/t gold and 14 metres at 0.53g/t gold.
The tenement has 3 known prospects; the Davie, Coupon and Anomaly 24-28. Historical records indicate Davie workings recorded 14g/t gold at surface. At Coupon, 32 tonnes of ore was mined at 12g/t gold.
The current study by Hellman found the broad low grade consistent mineralisation intersected in the drilling at Coupon and Davie prospects, indicates "potential for a series of low grade gold deposits within the Sulphide Creek area."
There were similarities in geological age and settings to the South Carolina Slate Belt deposits of the Haile and Ridgeway mines.
The study concluded, there exists significant exploration potential for the Sulphide Creek area "in the order of 30-50Mt @ 0.75-1g/t gold for a total of 1 million ounces."
Follow up drilling is likely by Shree on the Coupon and Davie prospects focusing on either the significant previous drill intercepts or untested surface geochemical anomalies.
The drill targets will aim to intersect higher grade gold mineralisation of substantial widths.
The Sulphide Creek Gold tenement is located near Lynchford, 5 kilometres south of Queenstown, Western Tasmania.
Should drilling continue to be successful at Sulphide Creek, the region is renowned for its major discoveries and mines, strong infrastructure and established workforce.
Shree’s Sulphide Creek tenements (EL43/2004) are within the Dundas element, which hosts world class deposits such as: Bass Metals' (ASX: BSM) Rosebery and Hellyer copper, lead & zinc mines; the Mt Lyell Copper-Gold Mine; the Henty Gold Mine; Metals X's (ASX:MLX) Renison Tin Mine and the Avebury Nickel Deposit.
Historical records show that alluvial gold was panned in many streams of the Sulphide Creek area and traced back to source. This resulted the excavation of several shallow shafts and adits. The Woody Hill Gold Mine, just north of the current licence is reported as producing 4.6 kg of gold from 265 tonnes of ore at a grade of 17.6 g/t gold.