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Skeena updates resource at Donnelly and North Donnelly copper/gold deposits

14th January 2016

By: Henry Lazenby

Creamer Media Deputy Editor: North America

  

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TORONTO (miningweekly.com) – TSX-V-listed Skeena Resources on Thursday published a new National Instrument 43-101-compliant technical report, expanding the mineral resources of the Donnelly and North Donnelly copper/gold deposits, located in the Golden Triangle of north-western British Columbia.

Skeena said that the contained pounds of copper and ounces of gold in the measured and indicated categories had increased by 12% each, in comparison with the 2007 estimate completed by Canadian Gold Hunter. The inferred pounds of copper and ounces of gold rose by 200% and 280%, respectively.

The 38 374 ha GJ property, on which both deposits were located, was acquired in October 2015, and was located next to the company's Spectrum gold project, where 17 350 m of drilling in 61 holes was completed in 2015. A resource study was also in progress for Spectrum and would be released by the end of March.

The report assessed that the overall tonnage of resources in the measured and indicated categories had increased by 9%, at a 0.2% copper cutoff and slightly higher average grade, in comparison with the 2007 estimate.

Skeena advised that a significant proportion of the resource had been upgraded to the measured category. At the same 0.2% copper cutoff, the inferred tonnage had increased by 234%. The measured material was all within the Main Donnelly zone, while the increase in indicated resource was a combination of converting inferred to indicated within the Main Donnelly zone and adding the North Donnelly zone, which was not assessed in 2007.

The Donnelly and North Donnelly zones have a width of 340 m, a strike length of 1 600 m and an average depth of 200 m below surface.

The company believed there was significant potential for resource expansion to the west and at depth on the Donnelly deposits.

The Donnelly and North Donnelly deposits hosted updated measured and indicated resource – using a 0.2% copper cutoff – of 133.67-million tonnes grading 0.32% copper and 0.36 g/t gold for a total of 940.23-million pounds of copper and 1.56-million troy ounces of gold. It also hosted 53.69-million tonnes grading 0.26% copper and 0.33 g/t gold in the inferred category, using a 0.2% copper cutoff, for a total of 312.53-million pounds of copper and 570 000 troy ounces of gold.

DISTRICT POTENTIAL
The latest report recommended resource modelling of the nearby GJ deposit, which was not included in the current resource estimate. It also suggested that a property-wide target review be completed to evaluate exploration potential of other porphyry and high-grade vein prospects.

"The deposits at GJ, in conjunction with the Spectrum deposit, all of which are open for expansion, form the foundation of a district-scale development project, located close to electrical power and roads in a mining-friendly jurisdiction.

"Although metal prices are not favourable for development of the GJ property at this current time, we view the deposits at GJ as an inexpensive long-term call option on copper and gold prices, with very low holding costs," Skeena president and CEO Walter Coles commented.

He noted that the grade of the current resource at GJ was comparable to the nearby Red Chris mine of Imperial Metals, which began operation in February 2015, with a reserve of 301.5-million tonnes grading 0.359% copper and 0.274 g/t gold.

"The proximity of the GJ property to our higher-grade, gold-rich Spectrum deposit offers synergy, scale and flexibility for future development. We are excited about the opportunities to expand these deposits and to renew exploration on other nearby bulk tonnage and high-grade targets on this very large property package," said Coles.

Edited by Samantha Herbst
Creamer Media Deputy Editor

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