Lukas Lundin's base metals explorer, NGEx Resources (NGQ:TSX) this morning released seven of fourteen holes from their 2013/2014 field season at their Josemaria project in Argentina. The focus of their 7,302m program was to define the high-grade supergene zone near the north end of the project and to test a possible extension there.
Two of the holes successfully intersected this high-grade supergene zone with hole JMDH78 intersecting 0.54% copper and 0.11g/t gold (0.63% copper equivalent) over 340m. JMDH80 was drilled into the indicated resource block and therefore is expected to increase that portion of the model. They also completed several large step-out holes to test a broad area of leached cap which extends to the north and northwest.
Other highlight holes included hole JMDH81 which intersected 510m (starting at 94m downhole) of 0.35% copper and 0.2g/t gold (0.50% copper equivalent). Also, hole JMDH80 which intersected 0.44% copper and 0.22g/t gold (0.61% copper equivalent) over 432.5m. These two holes were drilled along the edge of the indicated block and should convert inferred resources into indicated.
Three step-out holes were drilled between 90 and 300m from the inferred resource block at Josemaria and represent an extension to the northwest of the known mineralized zone as well as the potential to host a separate mineralized porphyry centre. The company intends to complete follow-up drilling here.
NGEx also provided a preliminary update on the engineering studies that were started in the second half of last year and aimed to determine preliminary development ideas for Josemaria. The work focused on an open-pit operation, processing between 120 to 160,000tpd. Within the total resource estimate there is a shallower and higher-grade component with an estimated grade of 0.44% copper (versus indicated grade of 0.35% copper and inferred grade of 0.28% copper). The engineers are now investigated the economic pros and cons of processing this material in the early days of a potential mine.
Baseline environmental programs, including review of areas for potential infrastructure, are under way, with fieldwork in progress during the current South American summer season.
At Filo del Sol, which is located 15km away from Josemaria and straddles the Argentine and Chilean borders, the company updated investors on their planned 7,000m drill program there. As of February 9, 2014 NGEx had completed 5,875m in 18 holes with assays pending for all of them. The company's focus for this years program at Filo del Sol was to provide enough drill data to compile an initial resource estimate for a stratabound, high-grade silver-copper zone.
They also are focused on testing the potential for a feeder zone to the stratabound mineralization comprised of significant copper and gold mineralization Drilling here is expected to be completed by early March.
Between Q2 and Q3, the company was burning roughly $1.7 million per month and ended September 2013 with $18 million. This would leave them with roughly $10 million in cash remaining (assuming a similar burn). NGEx last raise was $34 million at $3.40 per share in January of last year.
Japan Oil and Gas National Corporation ( or "JOGMEC") as well as Pan Pacific Copper Company Ltd. are both NGEx's project partners for these world-class base metals projects. NGEx is the 60% operator with JOGMEC and Pan Pacific holding 60% interests in the projects. Pan Pacific owns 75% of the Caserones Copper and Molybdenum project located 10km north of Los Helados and had a price tag of $3 billion.
Read: NGEx Intersects 0.63% Copper Equivalent Over 340 Metres at Josemaria and
Provides General Exploration Update for Argentina Projects