Geology

Regional Geology

Kamchatka forms part of the Pacific 'Ring of Fire', a volcanically and seismically active zone that rings the Pacific Ocean. The peninsular is formed from a number of superimposed volcanic arcs, some of which are still active, that have been generated since the Tertiary age. The arcs are orientated north-northeast along the axis of the peninsular and are delineated by linear alignments of volcanoes and valleys. The presence of active volcanoes, geothermal springs and regular seismic events indicates that this activity is ongoing. Such geological conditions are conductive to the formation of epithermal style gold/silver deposits and are recognised as making the Pacific Rim geologically attractive to exploration companies looking for epithermal gold mineralisation.

A large number of gold occurrences have been identified in Kamchatka, the majority of which occur in two distinct zones. The Vilyuchinskoye-Golsovskoye Zone, a northwest-southeast trending zone of gold occurrences, is of most importance in the context of Asacha/Rodnikova and has been interpreted to be a result of regional scale rifting forming dilational structures between two strike-slip faults.

Such dilational structures are recognised as being conducive to the formation of hydrothermal vein deposits such as at Asacha and Rodnikova. Rodnikova occurs at the southern end of the zone while Asacha is located a further 60 km south-southwest of the main trend.

The map below presents a regional map of southern Kamchatka indicating the location of Asacha and Rodnikova in relation to the Vilyuchinskoye-Golsovskoye Zone and other gold occurrences.

Map of the Asacha location (new window)

Deposit Geology

The Asacha deposit occurs within either a caldera structure or the remains of a large eroded volcano. Younger ash deposits that limit the exposure of the older rocks now overlie much of the area surrounding the deposit. The deposit consists of a number of north-south orientated parallel veins emplaced into the surrounding country rocks.

Map of the area (new window)

The country rocks have been subdivided into a suite of volcanics and a number of sub-volcanic intrusions. The volcanics consist of a variety of tuffs that are permeable and incompetent in nature and are therefore not susceptible to brittle deformation and subsequent vein deposition. The sub-volcanic intrusions consist of a number of dacitic to andesitic domes and sills that are competent in nature and subject to brittle deformation and vein formation.

A number of structural trends have been identified in the Asacha project area. Two regional northeast trending structures are present, the most northerly of which crosscuts the veins without any discernable deformation. These are therefore interpreted as pre-mineralisation regional features. A series of east-west trending structures are present which are also interpreted to be pre-mineralisation features. Some post-mineralisation movement, however, may have resulted in some displacement of the mineralised veins. The veins themselves are hosted in north-south trending structure corridors. A series of northwest trending structures has resulted in a number of mineralised offshoots and splays from the main veins. Notwithstanding the apparent structural complexity of the area, the veins containing the bulk of the resource are essentially undeformed in nature and continuous along strike.

Cross section map (new window)

The Company has classified the gold-silver mineralisation at Asacha as a low sulphidation adularia- sericite epithermal type quartz veins, such as those found in a number of localities along the margins of the Pacific Ocean. Two principal vein systems have been identified: the Main Vein system; and the lesser-explored Eastern Vein system. The majority of the identified resources occur in the Main Vein. The Main Vein at depth consists of a north-south striking vein dipping steeply to the east. Closer to surface, this vein splits into a number of subsidiary veins including some zones of stockwork. The Eastern Zone consists of a number of minor north-south trending steeply dipping veins.

The veins at Asacha are banded in nature with alternating bands of quartz and dark sulphidic material. The majority of the gold mineralisation occurs within the sulphidic bands, with lesser amounts in the surrounding quartz. Ore shoots have been identified in the veins and are interpreted as being a function of the interaction between the northwest trending structures and the veins, resulting in dilational zones.

Extensions to known mineralisation

Main vein system

Based on existing drill intersections strike extensions to the main vein system, especially to the north, are considered likely. Drilling of eleven holes should account for the conversion of Russian P1 resources between 55700mN and 56000mN.

From the drill intersection on 56000mN to where the vein outcrops on 57000mN, there is approximately 1km of untested strike potential. While immediately south of the main veins is largely closed off, there are outcropping dacites (the preferred host rock) mapped further south along strike.

Potential targets

Based on the occurrence of outcropping veins with coincident multi-element geochemistry, the potential exists for three potential targets in close proximity to the main vein.

Supriz

The Supriz zone, located near the eastern boundary of the current lease, is considered a good quality conceptual target. There is coincident, elevated As, Sb, Te and Se geochemistry which define a linear anomaly parallel with resistivity trends. The northern section has well-developed adularia alteration related to an 80m-wide quartz-adularia stockwork vein system. The Au values are generally <1 g/t but the multi-element geochemistry and low-temperature adularia alteration suggests that the current erosional surface may be high in the epithermal system, with untested depth potential.

SW Flank

A high grade trench sample (1m @ 25g/t) from a dacitic dome with well-developed argillic alteration and a coincident resistivity anomaly makes this area as a conceptual target.

C5

This target is based on low grade Au mineralization (0.5m @ 1.5g/t Au) in surface trenching and a coincident resistivity anomaly.

Asacha Exploration Potential, March 2006 PDF (1Mb)