Naogaoshandu Gold Project

The Naogaoshandu gold project consists of a 47 sq km Exploration Licence taking in several areas of gold anomalies or surface gold mineralisation discovered by King Solomon in the Sonid Zuoqi district of Inner Mongolia.  The licence area abuts the company’s Beyinhar North tenement and is centred only 25km west-southwest of its Marmot Cu-Mo project and 14km northeast of the Beyinhar gold discovery (1.2 m oz gold resource at January 2009) of Sino Gold.

The principal targets at Naogaoshandu are, in order of priority, the South Ridge and Three Eagles epithermal gold systems, the Quarry gold anomalies and the New Eastern mesothermal gold system.  The first three of these targets are hosted in chlorite schists on the flanks of a granitic intrusive forming a local topographic high.  The New Eastern prospect is hosted in schists intruded by a series of diorite plugs.

The newly-discovered South Ridge prospect consists of an 800m north-south elongate zone containing strongly Au-mineralised discontinuous quartz lenses, veins and veinlets. The zone is up to 400m wide near the southern extremity and tapers to tens of metres wide at the northern end.  It remains open to the south where it disappears under drifting sand cover.  The zone is hosted in strongly-foliated chlorite schists (meta-volcanics?) and is spatially associated with a contact between the schists and a north-south elongate granitoid intrusive to the east.  The quartz structures within the zone are typically short (single metres to tens of metres); narrow (10cm to 2m); and lie at various oblique angles to the overall trend of the zone.  Gold values from representative chips are commonly in the order of several g/t Au and occasionally over 10g/t Au.  There are no significant silver or base metal values associated with the gold.  A large area of pervasive silicification further eastward, and similar but smaller areas to the southeast, are un-mineralised at surface but merit investigation at depth. 

The Three Eagles prospect is divisible into the Western and Central zones.  Scout RC drilling by KSO in the Western zone targeted outcrops of arsenic-anomalous silicified chlorite schist and yielded underlying anomalous gold values (up to 2.1g/t Au over 1m) associated with zones of veining, pervasive silicification and pyrite. The Central zone covers clusters of anomalous gold-in-rock values, the strongest being a 400m x 300m area of >0.1g/t Au samples yielding a small number of values in excess of 1.0g/t Au and including a highest value of 45.2g/t Au.

The Quarry prospect also contains a number of gold-in-rock anomalies albeit weaker than at Three Eagles.  There are other scattered anomalies in the wider environs.  Gold anomalies at New Eastern are scattered and highly irregular despite many vein outcrops.  This indication of a “spotty” gold environment is what places this prospect at the lowest end of the priority scale.

Ongoing exploration at Naogaoshandu will be directed in the first instance, at trench and drill investigations of the South Ridge and Three Eagles prospects.