Encouraging gold intercepts were recorded in the initial air core holes south of Tomingley including 6 metres at 1.36 g/t gold from 66 metres.
The substantial exploration program has been implemented to build on the existing resources and reserves inventory.
It is testing underground ore positions at the Tomingley Gold Mine and at near mine and regional exploration targets and also revisiting underground ore potential at Peak Hill.
Mineralisation has been identified over an open strike length of 1,200 metres and a large strike length remains untested.
Drill result details
Extensive regional air core drilling commenced in February and the current drill results are from the Eulinda Park Prospect area representing a strike length of at least 1,200 metres.
- 6 metres grading 1.36 g/t gold from 66 metres (base of alluvium);
- 7 metres grading 1.06 g/t gold from 103 metres to bottom of hole;
- 6 metres grading 1.13 g/t gold from 87 metres;
- 3 metres grading 1.92 g/t gold from 57 metres; and
- 6 metres grading 1.16 g/t gold from 75 metres.
The results are very similar in tenor to early exploration aircore drilling that lead to the discovery of the Wyoming deposits now being mined at the Tomingley Gold Operations.
Drilling has also been completed at the Jounama and Cemetery prospects and Coldstream with assays pending.
Alkane has two key assets both in New South Wales, the cash generating Tomingley Gold Operations (TGO) and the construction-ready Dubbo Zirconia Project (DZP).
The TGO is within the greater 270 square kilometre Tomingley Gold Project and the gold mine consists of Wyoming One, Wyoming Three, Caloma and Caloma Two gold deposits.
While the TGO continues to generate cash inflow for the company, the development of the DZP valued at US$0.92 billion represents a significant opportunity for Alkane.
The DZP is located 400 kilometres northwest of Sydney and is a large polymetallic resource containing zirconium, hafnium, niobium, yttrium and rare earths.
The project is construction ready with financing negotiations currently in progress and production anticipated to commence in 2018.
Securing financing for the DZP is a key milestone for Alkane.
The 16,277 metres of aircore drilling completed to date testing the southern boundary of the TGO indicates that stratigraphy and mineralisation similar to that which hosts the ore deposits at TGO is present.
With assays pending for completed drilling, Alkane remains leveraged to further exploration based news flow over the short term.
As Tomingley is Alkane’s cash producing asset, any extensions to gold resource will provide an opportunity to extend the life of mine, which will extend cash flows.
Cash flows from Tomingley have allowed Alkane to progress the DZP without diluting shareholders and with gold recently trading at A$1,665 per ounce, it is an opportune time to be a gold producer in Australia.
The DZP has been referred to by market commentators as the most advanced and arguably best rare earth elements and specialty metal project in the world.