Xanadu Mines extends Stockwork Hill deposit with broad high-grade copper discovery

Xanadu Mines (ASX: XAM) has discovered a broad zone of copper mineralisation within its Kharmagtai copper and gold project in Mongolia’s Gobi region.

Drilling uncovered the mineralisation outside of the current Stockwork Hill resource, which Xanadu claims increases the deposit’s potential.

Three diamond core holes have now been completed to the east of Stockwork Hill to extend the known mineralisation.

Initial results from drill hole KHDDH526, which was undertaken to the deposit’s immediate east, returned 117m at 0.68% and 0.58 grams per tonne gold from 555m.

The broad zone includes a 62.8m interval grading 1.16% copper and 1.04g/t gold from 607m.

Xanadu chief executive officer Dr Andrew Stewart described the drill hole as “pivotal” for both the project and the company.

“We have always believed that the high-grade tourmaline breccia at Stockwork should extend to the east, but previous drilling had been unable to locate the eastern extensions of the mineralisation.”

“KHDDH526 now confirms that mineralisation certainly extends beyond Billy’s basalt shear and may potentially extend all the way to the Sandstorm prospect over 1km away.”

Dr Stewart added the results support the company’s theory the project could potentially host a “significant” copper-gold system.

Underpinning this theory, is data which indicates the Stockwork Hill mineralisation’s geophysical signature extends 1,000m east of the resource.

Kharmagtai copper-gold project

Kharmagtai is located about 120km north of Turquoise Hill’s Oyu Tolgoi copper-gold mine and 440km from the capital Ulaanbaatar.

The project has an interim open cut inferred and indicated mineral resource of 1.9 million tonnes contained copper and 4.3 million ounces of contained gold.

Dr Stewart said the company believed Kharmagtai hosted a “similar type of system” to the Oyu Tolgoi operation.

“Our long running objective is to develop Mongolia’s next large-scale copper-gold deposit,” he added.

The company has devised numerous conceptual exploration targets for the project, with the Stockwork Hill target ranging between 66-248Mt at 0.3-0.5% copper equivalent.

Stockwork Hill has a higher-grade target of 19-63Mt at 0.5-1% copper equivalent.

Meanwhile, the largest mineralised zone at White Hill has a target of 331Mt to 1.24Bt at 0.3-0.5% copper equivalent.