Junior explorer PNX Metals (ASX: PNX) has commenced reverse circulation drilling at the eastern zone of the recently-acquired Glencoe gold deposit, located north of its Fountain Head gold project in the Northern Territory.
Drilling will focus on the zone’s extensional area and will aim to increase confidence in Glencoe’s current inferred resource estimate which sits at 2.1 million tonnes at 1.2 grams per tonne gold for 79,000 ounces.
High-grade rock chips have previously been collected 400m east of Glencoe, with gold highlights of 6.02g/t, 4.04g/t and 3.05g/t.
PNX said reprocessed magnetic data supported an interpretation that the focus area lies within a regional-scale shear zone which can be traced for over 1km to the southeast of Glencoe.
This structure remains largely unexplored, while newly-identified surface mineralisation and an underlying shear zone represent a potentially significant extension to the deposit.
Coarse gold occurrences
Recent geological field mapping and sampling reported numerous occurrences of coarse gold detected at surface in a discontinuous sub-cropping quartz vein traced for over 50m along the northern margins of the south pit.
Seven pieces of coarse gold were identified in float samples adjacent to the vein and support the potential for extensions to the mineralisation at Glencoe beyond the current resource estimate in an area which has seen limited drilling to date.
Trenching and costeaning will take place following the current drilling program to collect more robust geological observations and samples for assay.
PNX is also planning three diamond drill holes for approximately 360m to generate further rock density and structural data as well as oxide (transitional) material for ongoing geotechnical and metallurgical testwork.
In June, PNX finalised a pre-feasibility assessment of the technical and economic parameters to sequentially develop the Fountain Head gold project (which includes Glencoe) and Hayes Creek gold-silver-zinc project.
The study highlighted a robust, multi-commodity development with a forecast unleveraged pre-tax net present value of $171 million and a mine life of 10 years with undiscounted revenues of $972 million over that time.
PNX acquired Glencoe in April from private company Ausgold Trading as a “bolt-on” asset to the Fountain Head development.
Of the $1.87 million total consideration payable to the vendor, PNX has paid $1.17 million to date with the balance due by year end.
The company recently received unconditional approval from Australia’s Foreign Investment Review Board for the acquisition, thereby satisfying one of the conditions of sale.