Rodnikova
Location
Rodnikova is located on the southern end of the Kamchatka Peninsular in eastern Russia and is approximately 90km (by predominantly paved road) to the south of the port of Petropavlovsk-Kamchatsky, the regional capital.
Map of the Kamchatka Region (new window)
Ownership
The Company holds a 95.03% interest in Trevozhnoye Zarevo which holds mining and exploration licences covering both the Asacha (24km2) and Rodnikova (16km2) deposits. The Company has an obligation to acquire the remaining 4.97% of Trevozhnoye Zarevo for US$500,000 pending a final decision by the Board to proceed with the development of a mine at Asacha.
Status
Exploration and targeting work was undertaken on the licence area during 2004, along with several preliminary and conceptual studies to develop a strategy to further develop this deposit. No work was carried out at Rodnikova during 2005 or 2006.
The 2007 exploration programme commenced in June 2007. 27 exploratory holes, totalling 5,374 metres, were drilled in 9 profiles. 22 holes were drilled to analyse the main ore-bearing Zone 44 and 5 holes to study thin and short vein bodies adjacent to Zone 44 from the side wall.
Exploration activities were primarily focused on the central and most fully explored part of Zone 44 between Vilyucha River and Spokoiny Creek, where 19 holes were drilled in 7 survey profiles. Three holes in the profiles 42 and 51 were drilled on the northern flank of the zone where virtually no work had been conducted before. The outline of the previously recorded reserves has been extended by 340 metres along strike to the north and from 65 to 130 metres at depth.
The results received during the first quarter of 2008 included a number of higher grade intersections including 6.0 metres at 9.80g/t, 7.4 metres at 10.23g/t, 11.5 metres at 4.02g/t and 20 metres at 3.68g/t.
The results indicated that Zone 44 dips steeply (75 - 80 degrees) to the west. In its central part the thickness increases as the zone goes deeper. Mineral composition of the zone within the already explored part is practically homogenous. Based on the data acquired from three holes, the zone thickness and composition on its northern flank remain the same, although there is some reduction in grade. In general, the spatial behaviour of the mineralized zone is quite stable. No pinch-outs of the zone along strike or to depth have been identified so far.
The 2007 exploration work on Zone 44 has increased the previously stated inferred category resources by 634,000 tonnes, containing 124,100 oz gold and 652,730 oz silver, with an average true thickness of the ore body of 2.67 metres and gold and silver grades of 6.1 g/t and 32.1 g/t respectively, based on a cut-off grade of 4.0 g/t.
Given the sizes and mode of occurrence of the ore bodies, it is currently anticipated that the main part of the deposit would be developed by underground mining, with a small portion mined by open pit.
Exploration activities are now being focused on the southern flank of the zone. In 2008 it is proposed to complete evaluation of the southern flank of the zone using a wide hole spacing, continue exploration of the northern flank through wide-spaced holes, and run 2 - 3 profiles of prospect and appraisal holes on the Vilyuchinsky Area. During the year the Company will start preparing materials to draw up a pre-feasibility study and a report on the Rodnikova reserves estimate to be submitted for approval to the Russian State Committee of Reserves in December 2008 in accordance with the licence agreement.
Under the terms of the licence as amended in May 2006, the State geological authorities must approve Rodnikova's reserve and resource statement by December 2008, with production to commence in 2012 or after depletion of the Asacha ore.
Strategy
Studies to date have looked at underground mining options. Further exploration work is required to allow more definitive work and studies to be undertaken. All future work will be subject to strict environmental controls and approval of the relevant environmental authorities.