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Kirkland Lake looks towards Australian Union Reefs revival; visible gold near Fosterville

1st May 2018

By: Henry Lazenby

Creamer Media Deputy Editor: North America

     

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VANCOUVER (miningweekly.com) – Triple-listed Canadian miner Kirkland Lake Gold has reported strong drill results from the Union Reefs project, located in Australia’s Northern Territory, the company announced on Monday.

Four holes for 4 287 m were drilled from surface to test the potential of the Prospect, Crosscourse and the Lady Alice deposits – all brownfield targets related to historic openpit mining activities at Union Reefs, the company advised.

The company’s Northern Territory operations, including the Union Reefs mill and Cosmo mine, have been under care and maintenance since June 30, 2017.

“The potential to resume operations in the Northern Territory represents a significant opportunity to generate value for Kirkland Lake Gold. The success that we are having with the Lantern deposit at Cosmo, and now at Union Reefs, increases our confidence that we can establish an attractive five-year mine plan in the Northern Territory that will lead to profitable gold production that generates free cash flow,” stated president and CEO Tony Makuch.

Kirkland Lake said the results indicate the continuation of gold mineralisation at the three deposits below known mineral resources, and highlight the potential for resource expansion at each location within the Union Reefs gold trends.

The company also highlighted results from the Lantern deposit, located at the Cosmo mine site, and about 70 km from Union Reefs. In December, Kirkland Lake announced drill results that significantly expanded the size of the Lantern deposit. The highest-grade confirmed intersection ever identified at Cosmo graded 4 750 g/t gold over 0.3 m, with an estimated true width of 0.2 m. This was located about 250 m north of the known Lantern mineralisation, Kirkland Lake said.

Kirkland Lake is currently developing two exploration drifts to expose the Lantern mineralisation and support underground drilling, mapping and sampling as the company works towards bringing the Lantern deposit into production.

“For some time, we have thought that establishing an operation that meets our key objectives of around 100 000 oz/y of production at operating cash costs of under $650/oz and all-in sustaining costs of better than $950/oz would involve feeding the Union Reefs mill from multiple locations. The Lantern deposit is quickly advancing towards becoming an economic orebody, with progress expected to accelerate once we have completed our two exploration drifts,” Makuch noted in a statement.

VICTORIA GOLD
Meanwhile, Kirkland Lake on Tuesday reported intersects of visible gold-bearing ore at the Robbin’s Hill deposit, which is located 3.8 km from the Fosterville mine, in the State of Victoria.

The company says it encountered Robbin’s Hill mineralisation between 300 m and 550 m below surface, with grades improving as drilling extends to depth. This is a striking similarity to the Fosterville mine, where the highest grades are found below the 800 m level.

Recent surface drilling has returned intercepts of visible gold with some of the highest gold grades seen to date from the Robbin's Hill area. Mineralisation in recent drill core displays similarities to the high-grade, visible gold hosted quartz veins encountered in the Eagle, Swan and Harrier South zones at Fosterville, the company advised.

Drill results reported are from 39 surface drill holes totalling 24 985 m that define four mineralised structures in the Robbin’s Hill area along the O’Dwyer’s Trend. Exploration drilling in the Robbin's Hill area started in August 2016, where drilling has targeted down-dip extensions of mineralised structures mined from openpits in the 1990s. Drill results have demonstrated continuity of grade along four mineralised structures, the company noted.

“We have consistently said there could be ‘additional Fostervilles’ on our Fosterville land position, and a sizable portion of our roughly $40-million exploration budget for the area in 2018 is focused on finding the next mining operation.

“The results display marked similarities to the Lower Phoenix system with faults hosting sulfide mineralisation enriched with later stage visible gold, quartz-stibnite vein-hosted mineralisation at depth. In fact, we have now seen this occurrence towards high grades with visible gold in quartz veins that intensifies at depth three times; first at Lower Phoenix, then at Harrier and now at Robbin’s Hill, and fully believe there could be more to come,” Makuch said.

Kirkland Lake’s TSX-listed equity has gained nearly 52% in the past six months and on Tuesday added 2.28% to trade at C$22.91 apiece.

Edited by Creamer Media Reporter

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