Monday 26th September 2016

Resource Clips


Low-hanging fruit

GTA Resources considers mining near-surface, high-grade Ontario gold

by Greg Klein

For the majors, the really big new gold deposits seem more and more elusive. But GTA Resources and Mining TSXV:GTA thinks it might have found enough low-hanging fruit to make a substantial impact on a small-cap company. Recently optimized high-grade pit shells have GTA examining the possibility of low-cost production at the Northshore project, 125 kilometres west of Hemlo.

GTA Resources considers mining near-surface, high-grade Ontario gold

A program of shallow infill drilling would help determine
the viability of small-scale mining at GTA’s Northshore project.

“We knew we had a high-grade zone within the Afric deposit,” CEO Wayne Reid says of Northshore’s June 2014 resource estimate. “And we wanted to know what could be put in shallow pits as a high-grade resource because it might be very simple to mine this stuff in an open pit with very little stripping and truck it to an existing mill.”

In a joint venture with Balmoral Resources TSX:BAR, GTA has completed a 51% earn-in and acts as operator of the 337-hectare project on the Hemlo-Schreiber Greenstone Belt. Based on 52 holes totalling 11,390 metres, the Afric zone’s resource used a 0.5 gram-per-tonne cutoff to show:

  • indicated: 12.36 million tonnes averaging 0.99 g/t for 391,000 ounces gold

  • inferred: 29.58 million tonnes averaging 0.87 g/t for 824,000 ounces

Intrigued by the high-grade areas close to surface, GTA commissioned an engineering study that detailed two pit shells within the existing resource. In results released this month, two options were provided within each shell, with those for the West area showing:

Pit Pws 28

  • indicated: 56,825 tonnes averaging 2.92 g/t for 5,335 ounces

Pit Pws 31

  • indicated: 100,665 tonnes averaging 2.8 g/t for 9,062 ounces

For the East area, the two options showed:

Pit Pws 28

  • inferred: 62,809 tonnes averaging 2.86 g/t for 5,775 ounces

Pit Pws 31

  • indicated: 91,449 tonnes averaging 2.38 g/t for 6,998 ounces

  • inferred: 287,060 tonnes averaging 2.63 g/t for 24,273 ounces

For both East and West areas, pit 28 totals 5,335 ounces indicated and 5,775 ounces inferred. Pit 31’s total comes to 16,060 ounces indicated and 24,273 ounces inferred. The strip ratio for each pit came to 0.5 and 0.8 respectively.

If a low-cost mining scenario proves possible, such numbers could offer significant opportunity for a company like GTA, Reid says. An affable Newfoundlander who’s been a professional geologist for close to 40 years, he looks back on a career largely focused on Archean gold deposits, mainly in the Timmins camp but also in Red Lake, along with base metals and uranium experience.

Reid spent over 20 years in senior roles with the Noranda/Hemlo group. He’s also served as manager of Canadian exploration for Echo Bay Mines and exploration manager for St. Andrew Goldfields TSX:SAS, in addition to positions with other companies. Reid initially staked and began exploration at Brewery Creek and took part in the team that sunk the first holes in Newfoundland’s Boundary deposit, which became the Duck Pond mine.

Looking at Northshore’s optimized pits, he says, “I think that if our preliminary numbers can be verified you could have a good profit without needing a lot of capital. What we need to do now is put some economic numbers on that and also firm up those ounces.”

To accomplish that, Reid wants to do shallow infill drilling, baseline environmental studies and a mini-bulk sample ranging from 10,000 to 50,000 tonnes, depending on what permitting allows. A four-kilometre road linking to the Trans-Canada Highway would need upgrading. “We’ve already talked to some existing mills within a 150-kilometre radius of the deposit,” Reid says.

With $600,000 now in the till, GTA hopes to raise more money soon through a flow-through share offering which would allow further work to resume around mid-summer.

I think it would take one key person to co-ordinate it. After that, it’s all contracting—the mining, the trucking, the milling.—Wayne Reid, CEO of
GTA Resources and Mining

While the Hemlo-Schreiber Greenstone Belt discovery remains GTA’s flagship, the company’s also active farther east, between Timmins and the Borden Lake deposit acquired by Goldcorp TSX:G earlier this year. Now in the second year of a 100% option on the Ivanhoe project, GTA expanded its claims by 40% over the last year to compile a 13,258-hectare land package. An interpreted extension of the Destor Porcupine fault zone extends across the northern part of the property.

Last year’s prospecting identified four areas of gold mineralization on the Destor Porcupine break and a porphyry trend. Samples graded up to 4.1 g/t and 18.1 g/t. Magnetometer and induced polarization surveys followed, with IP finding several high resistivity and chargeability targets that appear to coincide with the mineralized areas. With additional fieldwork to come, drilling is tentatively planned for late summer or early fall.

In Reid’s home province and near the Duck Pond mine he helped explore, GTA optioned claims earlier this month that comprise part of the Burnt Pond zinc-copper property. “We’re going to do a geophysical program to better identify some VMS or base metals targets and get ready to drill them,” he says. The plan is to take advantage of Newfoundland’s 50% rebate on exploration costs. Surveys could begin in summer or fall.

Back in Ontario but currently on the backburner is GTA’s Auden property, immediately south of Zenyatta Ventures’ (TSXV:ZEN) Albany graphite project.

If all goes well at Northshore, the high-grade, near-surface areas could potentially “make serious money for our market cap,” Reid emphasizes. For the exploration company to go into production, “we would have to get the right people in the right places,” he explains. “I think it would take one key person to co-ordinate it. After that, it’s all contracting—the mining, the trucking, the milling.”

He adds, “Now if someone wanted to take it out and buy it from us, we’d be open to that also.”


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