Georgian Mining Corp (LON:GEO) Managing Director Greg Kuenzel caught up with DirectorsTalk for an exclusive interview to discuss the initial Mineral Resource estimate for Gold Zone 2 at Kvemo Bolnisi
Q1: Now Greg, you announced your initial mineral resource estimate for Kvemo Bolnisi, can you talk us through the highlights?
A1: The announcement today was related to one of three zones that we’ve been actively exploring and developing over the last 12 months now at Kvemo Bolnisi. Kvemo Bolnisi is one of a number of projects we have within our 860-square kilometre licence in Georgia, which we hold under a 50/50 JV.
The work, earlier this year, was focussed on a target we refer to as Copper Zone 1 and we announced an initial resource on that copper zone earlier in the year, now that resource was targeting a 1-2 million tonne resource at greater than 1% to allow us to then start mine planning to provide ore to our local partner’s float plant which is only located 7km away.
Work then moved on to Gold Zone 2, which is slightly to the north of the copper sulphide zone, the area is quite interesting in that it generally has this gold oxide cap occurring from surface, in most places it’s only several metres from surface and it’s referred to as a scab for that reason. We started doing work up in Gold Zone 2 earlier in the year, we commenced with excavation so geochemistry excavations then we did some drilling which we then expanded as we were discovering that the gold oxides in that area were occurring a lot deeper so from surface down to around between 40-50 metres. So, we focussed our drilling on an area of approximately 150 by 150 metres, with the target of achieving an initial 750,000 – 1 million tonne resource with a grade target of 1 gram per tonne. We’ve exceeded that target with today’s announcement, we have an overall resource of close to 2.3 million tonnes at 0.85 with an optimised open pit target within that of 1.14 million tonnes at 1.1, now that number has been chosen again, our partner operates 2 producing mines in Georgia, with 2 heap leach plants so that target was defined to basically allow us to start production and producing ore that was going to be able to supply those heap leach plants.
So, work is continuing now on an internally-generated scoping study, we’ve almost completed our metallurgical work, we’re about 95% through that. The met testing has all been very positive to date, we’re getting very good recoveries and the ore is of almost exactly the same type has been processed over the last 30-40 years at the local operations so it’s amenable to heap leaching. So, very very positive result for Georgian Mining Corp.
Q2: You mentioned that the metallurgical test work need to finalise the scoping study is on the way and nearly complete, what happens next?
A2: The next stage is to finalise that met work and finalise the scoping study document, we expect that to be completed imminently and then the next stage is to start the detailed negotiations on the timetable and the terms for the production and processing of the ore. In the meantime, we’re continuing with infill and step-out drilling, the infill drilling really aimed at increasing the grade and the categories of that larger global resource of 2.3 million tonnes at 0.85, this has turned out to be quite a reasonable sized gold oxide deposit. I think one of the important things to point out as well is given it occurs from surface, there’s little if any stripping so as soon as you break ground, you’re effectively producing ore so it’s a very very positive position to be in. So, we expect the met work to be finalised imminently, that scoping study will then be finalised and then the next step is then to finalise the timetable and the terms for production and processing.
Consecutive to that as well, I mentioned we’re doing infill drilling on the gold oxide, we’re also doing step-out drilling to the east and to the south to look at joining up the other zones that we’ve been working on. You might remember, when we announced some of the drill results on the gold oxide zone back in early June, very excitedly for us we discovered that as we broke through the base of the oxide, we started hitting copper sulphides again as well as a high-grade chalcocite mineralisation which returned a grade of 16 metres at 15% copper including 5 metres at 40%. More importantly than that, we’ve intersected copper sulphides at depth, now we believe that these three zones very likely coalesce and as a result will join together to form one significantly larger target than the individual targets that we’ve been working on to date.
We’re also doing further work up to the north of those three zones; excavations, channel sampling and we’ll be looking to do some further drilling there later in the year and this is where we’ve defined the 50 million tonne exploration target. What we’re looking at now at Kvemo Bolnisi is the total footprint of approximately 1 km by 1.3km which interestingly is the same footprint as the open pit Madneuli mine which is located only 7km away, which has produced in the vicinity of 80 million tonnes in its 40-year life and is reported to have another 40 million tonnes, approximately, in resource.
So, we think there’s potential for Kvemo Bolnisi to grow quite significantly from where we now have it.