Category Archives: Exploration

Newcrest looking at marine waste dumping for Wafi-Golpu

Newcrest focusing on Wafi-Golpu

The National aka The Loggers Times | November 16, 2017

NEWCREST hopes to complete an update of Wafi-Golpu feasibility study by end of the March quarter next year, chairman Pater Hay says.
Hay said during the company’s annual general meeting on Tuesday that the company’s most advanced exploration project was the Wafi-Golpu project which he described as a “world-class copper-gold deposit in Papua New Guinea”.
Wafi-Golpu is an advanced exploration project located in Morobe and is owned by the Wafi-Golpu Joint Venture, one of three unincorporated joint ventures between Newcrest (50 per cent) and Harmony Gold (50 per cent), formed in 2008.
Hay said Newcrest continued to progress work at Wafi-Golpu, with focus on:

  • Assessing external and internal generated power options, in the company’s search for greater reliability and lower operating costs;
  • Comparing deep-sea tailing placements options to terrestrial tailings storage options; and,
  • Re-assessing block cave panels, size and processing capacity due to increased knowledge as a result of ongoing drilling.

“We are targeting completion of an update of the Wafi-Golpu feasibility study by the end of the March 2018 quarter. We will likely submit an amendment to the special mining lease application depending on the outcome of the study update,” he said.
“The timing of the first production is dependent on study outcomes and grating of the special mining lease.
“More broadly, brownfield exploration, brownfield expansions and de-bottlenecking offers some of the lowest-cost, lowest-risk and highest-return growth opportunities in our business.
“As has been stated in our annual report, we are currently pursuing initiatives and projects to add extra process capacity at Cadia and to increase mill throughput at Lihir.”

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No decision made in Bulolo licence application

Bulolo township

The National aka The Loggers Times | November 15, 2017

THE Mineral Resource Authority has clarified that a decision is yet to be made on the application for an exploration licence in Bulolo.
Managing director Philip Samar was responding to the claim by Bulolo district administrator Tae Gwambelek that an exploration licence (EL2544) had been issued.
Gwambelek had supported the objection by business houses, Papua New Guinea Forest Products and town residents over the alleged issuing of the exploration licence over existing leases near the town.
But Samar said no licence had been issued.
Samar said the MRA would conduct a wardens-hearing to allow the public and stakeholders to discuss their concerns and raise objections against the application.
After that, he said the warden would table a report with the mining advisory council for consideration.
“There will be no need for a township relocation just because an EL application has been lodged,” he said.
He also clarified that the MRA “does not issue tenements”.
“It recommends (it) to the minister or the head of the state,” Samar said.
Gwambelek said the application would be opposed.
“Bulolo residents are prepared for the scheduled hearing on November 28 to tell the warden that Australia has done enough damage to land in Bulolo,” Gwambelek said.
Morobe acting Governor Waka Daimon said that the land from Golden Pine Bridge to McAdams Park across to Manki Tower and along the Watut River down to Pine Top was owned by the National Forest Authority.

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Canadian courts decide fate of Misima islanders?

Way cleared for Misima restart

THE Supreme Court of British Columbia has granted final approval for the merger between Kingston Resources and WCB Resources.

WCB’s key asset is the Misima gold project on an island of the same name in PNG’s Milne Bay Province.

Historically, Misima has produced more than 3.7 million ounces of gold. It holds a recently completed NI43-101 resource of 2.3 million ounces.

Kingston managing director Andrew Corbett said the merger represented a transformational step for both KSN and WCB shareholders.

“We would like to take the opportunity to thank the WCB management and shareholders for their support during the merger process. The KSN board and management team welcomes the new KSN shareholders and we look forward to starting  work on Misima this month [November].”

The court approval follows overwhelming support from WCB shareholders for the merger with KSN. The process is under way to delist WCB and to issue new KSN shares to WCB shareholders.

“We are immediately starting work on Misima which includes completing a JORC resource, and re-establishing a field team incorporating current and new operational personnel who will be restarting geochemical field work shortly.

“Historical data completed on Misima has enabled Kingston to rapidly identify priority drill targets on Misima. The KSN management team aim to submit drilling approvals in the new year with a target of mobilising a drill rig in the fourth quarter of financial year 2018,” Corbett said.

Kingston said it was already working with the established field team to restart exploration work on the island.

A review of historic data has highlighted four key target areas. Each of these areas has been underexplored in the recent history of Misima as exploration work subsequent to the 2004 mine closure has focused on deep copper targets.

“Kingston is excited to return the focus to these anomalies, the initial aim will be to add shallow, higher grade tonnes to the existing resource,” the company said. The four target areas are:

  • Umuna East: Mineralised structures on southeast side of Umuna that are up to 1.8km in strike with evidence of high grade, shallow mineralisation. 
  •  Misima North: Which has more than 3km untested strike open to the north supported by historic mining and geochemistry.
  •  Umuna extensions: The existing resource is open along strike and down dip, with additional potential from both shear-hosted and skarn mineralisation which may add to the resource with drilling.
  •  Quartz Mountain: To the west of Umuna, Quartz Mountain is an area of higher grade mineralisation where the average hole depth to date is only 90m. The mineralisation remains open at depth. 

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Meetings to determine Panguna’s future

Cedric Patjole | PNG Loop | November 11, 2017

Two meetings have been identified as key events that may determine the timeline to rebuild the Panguna Mine in the Autonomous Region of Bougainville.

According to Business Advantage, Bougainville Copper Limited (BCL) chairman, Rob Burns, says the meetings, to be held in November and December, include a mediation as well as a wardens’ hearing.

The first meeting on November 23 and 24 is the third round of mediation talks to settle a dispute over the chairmanship of the Special Mining Lease Osikaiyang Landowners Association (SMLOLA).

SMLOLA is one of the nine landowner associations in the project area.

A dissident landowner, Philip Miriori, is at the centre of the dispute, along with his cousin Lawrence Daveona, who both lay claim to the chairmanship.

The second event on December 11 and 12 is the wardens’ hearings on the five-year renewal of the mining exploration lease, currently held by BCL.

Under the Bougainville Mining Act 2015, the Autonomous Bougainville Government needs to hold wardens’ hearings as part of the process for a five-year renewal of the lease, before recommendations then go to the Minister.

“I’m optimistic it will be renewed. The landowners have agreed because they want a better life and see this as the way forward,” says Burns.

The timeline for building the mine is estimated to cost K12 to K18 billion, and could take up to 10 years.

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Bulolo opposing new mining exploration

Bulolo township

The National aka The Loggers Times| November 10, 2017

THE Bulolo district administration is strongly opposing a licence for exploration activities near the town because the land had been damaged by past explorations, Administrator Tae Gwambelek says.

The administration is supporting the move by the business community and PNG Forest Products  (PNGFP) after the Mineral Resource Authority  (MRA) issued EL2544 to the Wabu Alluvial Mining company  (WAM).

Administrator Tae Gwambelek said Australia had done enough damage to land in Bulolo leaving behind huge craters on which the township was built.

“History will never be repeated again,” Gwambelek said.

“We have Hidden Valley and Wafi-Golpu mining including many small-scale activities. That is enough.”

Gwambelek said the Bulolo district development authority also acquired an exploration licence from MRA to conduct explorations outside Wau and Bulolo towns.

“How on earth, will MRA issue the EL 2544 to WAM to conduct explorations within the town? It is illogical,” he said.

“Bulolo town is not an exploration area and we totally object to the idea.

“We have PNGFP, National Forest Authority, University of Bulolo, Telikom Exchange, district administration office, police and courthouse and many small businesses operating in town and paying taxes to the government.

He said as the district chief executive representing 102,118 people in 324 villages and 108 wards, the idea was 100 per cent rejected.

He said the scheduled warden hearing on Nov 28, would be facilitated in front of the district headquarters to allow people to air their views.

Bulolo business representative Aaron Akui urged Minister for Mining Johnson Tuke and MRA chief executive Philip Samar to review the decision.

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Foreign investors mock PNG govt’s dumb deal

‘The project came gift wrapped, courtesy of the PNG Government who will buy 5% when it is ready to be mined by paying the equivalent of 5% of sunk costs to-date. This could see the PNG Government shell out more than $6m for just 5% of the project’.

Geopacific muscling into giant territory with PNG gold majors

Matt Birney | Business News | 9 November, 2017

They say that it’s often the second owner of the big projects that make money from them and that may well be true of Geopacific Resources’ Woodlark Island project in PNG.

It was picked up for a song by Geopacific from Kula Gold and is positioned dead centre in the middle of a string of copper and gold infested islands that make up mineral rich Papua New Guinea.

In a region littered with mining projects that boast gold resources of up to 60m ounces, it is almost unthinkable that Geopacific’s mineral reserve would remain at just 766,000 ounces of gold – a number that would already have most junior explorers starting a conversation with an EPC contractor.

A quick glance at the existing PNG projects that form a neat radius around Geopacific’s Woodlark Island project leaves you with the distinct impression that this is indeed the land of the giants.

Neatly positioned around Woodlark is Newcrest’s 49m ounce Lihir project, St Barbara’s 6m ounce Simberi project, Rio Tinto’s former 23m ounce Panguna mine, the 29m ounce Hidden Valley project, the dual 17m ounce Ok Tedi and Frieda River deposits and the 24m ounce Porgera project.

The goliath amongst the giants however is clearly the 63m ounce Freeport Papua project that boasts one of the largest gold and copper resources in the world.

At 2m ounces of resource and 766,000 ounces of reserve going 2.2 grams per tonne, Geopacific’s deposit, as impressive as it is, drifts into obscurity amongst these giants.

The company is however continuing to furiously drill it out and with such huge projects in their midst, management’s expectation of a sizeable upgrade in reserve is perhaps not unreasonable.

Kula Gold listed on the back of the Woodlark project with a remarkable $1.80 float in November 2010 that resulted in a $203m market cap for the company.

They had $80m in the bank on listing day and spent the lot on the project and then some.

In fact by the time Kula ran out of financial puff last year they had plunged almost $150m into the project and associated corporate entities.

Amazingly, Geopacific picked up 87% of it earlier this year through a series of corporate and project level plays for the paltry sum of just $10m worth of script and $650k worth of expenditure on the ground.

And the project came gift wrapped too, courtesy of the PNG Government who will buy 5% of it when it is ready to be mined by paying the equivalent of 5% of sunk costs to-date. This could see the PNG Government shell out more than $6m for just 5% of the project.

In addition to now holding 86% of Kula who own 95% of Woodlark, Geopacific already own 5% of the actual Woodlark project after spending $650k on it as part of their farm in agreement. Geopacific started their quest for control of Woodlark initially by entering into a farm in agreement with Kula, but later decided to take over the entire company in a 1 for 1.1 all script offer and to-date have secured 86% of Kula’s stock in a move that cost them only about $10m in script.

They also have further farm in rights and creep abilities that will most likely see them own almost all of it save only for the PNG Government’s 5% share in due course.

Woodlark could very well be a miners paradise too, with a reserve that may well keep growing and a project that is already fully permitted from both an environmental and mining perspective.

The project came with a veritable storehouse of drilling data from over 275,000 metres of drilling and Geopacific have added over 20,000 additional metres since getting involved.

Even though the global resource grade at Woodlark is 2.2 grams per tonne, the three different prospects within the project boast some impressive high grade breakouts.

These include a 32m intersection grading 7 grams per tonne gold, 48m @ 10.39 g/t, 36m @ 12.52 g/t, 11.2m @ 36.3 g/t and 22m @ 7.54 g/t gold, all of which are from the Kulumadau prospect which is still open to the west and East.

Geopacific discovered an 84m mineralised zone at Kulumadau with several well mineralised intercepts including 10m @ 7.84 g/t, 13m @ 3.11 g/t and 12.3m @ 2.23 grams per tonne gold.

Other impressively long intersections at the project include 21m @3.27g from 40m, 23m @ 4.82 g/t from 102m, 52 @4.5g/t, 19m @ 3g/t, 27m @ 2.5g/t, 34m @ 3g/t and 33m @ 4 grams per tonne gold.

Kula completed a feasibility study on the project some years ago which will most likely require updating now but will serve as a cost effective base for Geopacific’s own study of the resource.

Kula concluded that the project could turn out 674,000 ounces of gold over the first 6 years of mine life from a 1.8mt per annum plant.

They predicted that figure could increase to 813,000 ounces over the first nine years when in-pit inferred resources and lower grade stockpiles were utilised.

Cash operating costs were predicted to come in at around US$730 an ounce with capital costt looking like being somewhere in the order of U$160m.

Kula’s study also identified several out of pit areas that could potentially increase the ore reserve in time, particularly at the Kulumadau prospect where a further 4mt at 2.9 grams per tonne for around 400,000 inferred ounces were identi fied but not included in the pit design at the time.

Kula were looking to upgrade these resources with further drilling and the grand plan was to eventually amalgamate the Kulumadau east and west pits.

Geopacific recently raised $10.5m in an oversubscribed capital raise to continue the considerable work already carried out on Woodlark by Kula and they are now armed and dangerous as they hurtle headlong towards a decision to get into production.

The market is expecting an upgrade to the mineral reserve at Woodlark sometime soon as Geopaci c completes its own study on the project and continues its extensive drilling campaign.

Geopacific management appear have form too. The management team, led by Geologist Ron Heeks point to the 10 mines in six different countries they have developed between them as evidence that they can make Woodlark fly. Notably Heeks was the technical manager at Straights Asia and was partly responsible for turn around at the Muro gold mine and also at the Sebuku coal mine amongst other things.

The institutions are also sitting up and taking notice of Woodlark too with the likes of Tembo Capital, RCF, Pacific Road, Franklin Advisers and RMB Australia sitting comfortably on the Geopacific register now.

Woodlark is a fast developing story that looks to still have some upside with the potential to really surprise given the monolithic projects on its doorstep.

PNG is a region that does not consider a 2 million ounce resource or even a 2 million ounce reserve to be remarkable – at just 2.7c a share and with a market cap of around $50m, Geopacific and Woodlark look interesting amongst a sea of amazing projects.

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Drilling to recommence at Crater Mountain

Cedric Patjole | PNG Loop | October 11, 2017

Crater Gold Mining Limited has announced to recommence drilling activities in the near term following an agreement to acquire a drill rig.

The company said this in line with its strategy to restart exploration at its flagship Crater Mountain Gold Project in Eastern Highlands Province.

CGM has agreed to purchase a 2002 Atlas Copco Diamec 252 drill rig (“Diamec 252 Drill Rig”) together with additional ancillary equipment. They include: A 415 volt 45 kilowatt electric over hydraulic power pack; A 1,000 volt 45 kilowatt electric over hydraulic power pack; An air over 22 kilowatt hydraulic power pack;Bob Cat mounting accessories; And feed frames and positioners, skid mounted; and Hydraulic motors and pumps.

The Diamec 252 Drill Rig is a very compact drill rig and is estimated to be able to drill diamond core holes of up to approximately 300 metres in length.

Despite reports that the CGM has had difficulties raising capital, the announcement is expected to see positive results shortly.

The project is located approximately 50km southwest of Goroka and comprises 3 connecting exploration licences, straddling the border between the Chimbu and Eastern Highlands provinces.

This region is in the centre of the New Guinea Orogen, an extensive geological zone that makes up the mountainous spine of PNG. The western portion of this zone encompasses the world class mining operations of Porgera, OK Tedi, Wafi-Golpu and Grasberg.

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