- Georgian Mining Corp LON:GEO put out the results of two dramatically good drill holes from the Kvemo Bolnisi project yesterday.
- Copper grades start from close to surface implying an initial low stripping ratio
- 113.7m at 1.70% Cu from 18.4m (KED011)
- 28.6m at 1.60% Cu and 0.80g/t Au from 47.4m (KED008)
- The current location of the mineralisation incorporates the breccia pipes-diatremes and may indicate potential to find further epithermal gold mineralisation..
- The drill holes were angled back towards the original ‘discovery breccia pipe’ in order to pick up the northern limits of the mineralised structure.
- This was done in conjunction with the opening up of another excavation to the NNE for channel sampling and effectively directly east of this drill hole which was again looking for the limits of the pipe.
- The excavation exposed a large area of iron staining and alteration which looks like another pipe-like structure and one with more massive sulphides which may potentially pick up a number of similar pipe structures within the project area. This might be expected on the basis of a carbonate-base gold epithermal setting immediately above copper, gold porphyry mineralisation as seen in a typical Corbett Model.
Sp Angel Conclusion on Georgian Mining Corp LON:GEO : These are dramatically good drill results and should start to create new investor interest as the market appreciates the value and implications of the discovery of so much copper in the Kvemo Bolnisi system. Add to that the use of the joint venture processing facilities available at the nearby Madneuli mine which should fast track Kvemo Bolnisi into production.
We see Kvemo Bolnisi as offering a rather unusual combination of significant upside and a fast track to production. While we do not yet have much in the way of financial details of the joint venture arrangement we do believe the arrangement should result in a relatively low cost of around $600/oz in gold equivalent terms.
The big advantage of the arrangement is that Georgian Mining should have relatively little capital cost to bear. The use of a mining contractor and existing infrastructure between the proposed pit and the Madneuli processing plant means that capital costs should be very low. We would only speculate that there may be some cost to upgrading certain elements of the Madneuli process plant in order to achieve better recovery rates.
*SP Angel acts as Nomad and Broker to Georgian Mining
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