2021-11-19 12:37 ET – News Release
Mr. Matthew Salthouse reports
KAINANTU RESOURCES PROGRESSING EXPLORATION AT KRL SOUTH
Kainantu Resources Ltd. has provided the following update on its continuing exploration programs at KRL South for Q2 and Q3 2021, its highly prospective project located in the Kainantu region of Papua New Guinea (PNG).
Highlights:
- At KRL South, mapping, modelling and sampling (1,052 samples collected) have continued during the period, with a focus on the East Avaninofi prospect and Yaoro Ridge prospect.
- The East Avaninofi prospect has delivered encouraging results demonstrated by:
- Strong correlations of gold (Au) with silver (Ag), copper (Cu), molybdenum (Mo) and arsenic (As) and additional samples revealing elevated values of bismuth (Bi), tellurium (Te) and tungsten (W) (similar to the geochemistry observed at the nearby Bilimoia mineral field, known for its high-grade gold-copper intrusive-style mineralization);
- High levels of sulphur (S) and iron (Fe) which are key indicators of high-grade Au potential;
- A northeast-trending Cu mineralization-controlling structure of at least 10 metres (m) in width delineated, increasing in intensity toward the north of the prospect.
- Activities at the Yaora Ridge prospect have:
- Revealed strongly anomalous Cu and associated pathfinder elements;
- Returned an Au sample of 4.37 grams per tonne (g/t) Au;
- Shown lithologies, alteration and mineralization similar to the East Avaninofi prospect, with the two prospects appearing to be linked.
- The company is accelerating plans for delineation of drill targets for 2022 and progressing excavation/contour benching at the East Avaninofi prospect and Yaoro Ridge prospect.
- An airborne geophysics survey program for KRL South is in the advanced planning stage to leverage off the positive results obtained from the successful exploration activities during 2021.
Matthew Salthouse, chief executive officer of Kainantu, commented:
“Our targeted exploration program at KRL South has accelerated over the last six months, with a number of encouraging results reported from the East Avaninofi prospect and Yaoro Ridge prospect. All indicators continue to support the likely widespread intrusive-related gold-copper epithermal mineralization at this project, with strong copper indicators. The company is implementing a number of initiatives to define drilling targets in early 2022 as the next key milestone for KRL South, including an airborne geophysics survey.”
Background and KRL South progress
The company holds two highly prospective projects in the world-renowned Kainantu mining district, including KRL South (comprising EL 2559, EL 2650, EL 2652 and EL 2660 and 596.75 square kilometres (km) in size). KRL South is centrally located on the Kainantu transfer structure and is approximately 34 km southwest of the K92 gold-silver-copper mine. The project evidences multiple intrusive-related gold-copper styles of mineralization.
Since listing, the company’s immediate focus has been on exploration activities in the central area of KRL South, primarily around Tirokave. As reported earlier in the year, following a comprehensive ridge and spur program in 2020/early 2021 (with more than 2,000 samples taken), a number of encouraging outcomes were reported:
- Prospects were identified at the East Avaninofi prospect, Yaoro Ridge prospect and Kerefa prospect.
- High-grade rock sampling results at the East Avaninofi prospect were reported, including 40.13 parts per million (ppm) Au, with coincident 492 ppm Cu, 131 ppm Mo, 134 ppm Bi and 29.3 ppm Te.
- Detailed mapping and sampling indicated strong similarities between KRL South and other successful projects in the Kainantu district (demonstrated by lithologies, mineral-controlling structural trends, alteration zonation, mineralogy and geochemical data).
Building on these outcomes, Kainantu has continued its focused sampling program during the period, with mapping and manual excavation work along the dominant structural trends. The initial focus has been on the East Avaninofi prospect and moving onto the Yaoro Ridge prospect.
Further encouraging results and observations are reported below, with the company increasingly confident of delineating drill targets at these prospects in the near future. Intensive and focused mapping and sampling over the East Avaninofi prospect and further sampling at the Yaoro Ridge prospect continue to support the company’s view of the potential of this area for eventual definition of an Au resource.
East Avaninofi prospect
Building on the 40.13 g/t Au sample returned from the southern slopes of the East Avaninofi prospect (shedding from a zone of strongly fractured, hydrothermally altered and mineralized hornfels), an intensive mapping and sampling program was undertaken during the period, as noted above.
The primary aim of this was to clearly delineate structural zones bearing significant mineralization and then devise a working model to further progress this prospect toward drilling in 2022. This program is based on the company’s observations of the following:
- A 650-metre-long portion of the west-northwest-trending ridge considered prospective from a scatter of anomalous (20 to 100 parts per billion (ppb)) Au-in-soil samples and local rock outcrop anomalies, with up to 0.94 g/t Au reported;
- The mineralization style being mainly quartz-sulphide vein and fracture fill, hosted within hydrothermally altered hornfelsed metasediments often along the contact zones with one-metre-wide to 10-metre-wide late-stage andesitic dikes which appear to form a north-trending to northeast-trending swarm. Such dike swarms with similar orientations have also been mapped in the southeast sector of the Tirokave Ring feature, with some of the dikes shown to extend over at least one km;
- Outcrop mapping of at least three distinct phases of intrusive rocks, including the dikes, associated with the Elandora porphyry, all hosting copper sulphides to varying concentrations;
- The recognition of structurally controlled northwest through north-trending to northeast-trending hydrothermal altered and mineralized zones of at least 10 m in width, as indicated by the company’s petrological studies.
From the program over the period, 126 rock chip (outcrop and float) samples were taken across the East Avaninofi prospect and 92 results have been obtained. Selectively tabulated in an attached table, the most recent results returned confirm the likelihood of intrusive-related Au-Cu mineralization at the East Avaninofi prospect and the confidence in the working model being developed to rapidly delineate drill targets.
Specifically, the results demonstrate a probable nugget effect on Au values, with the comparison of fire assay (ppm) and ICP (inductively coupled plasma) (ppb) methods. This is to be expected, particularly in the surficial portions of the mineralization. The results also indicate strong correlations of Au with Ag, Cu, Mo and As, in addition to some elevated values of Bi, Te and W. This supports observations of geochemical similarity between KRL South and the nearby Bilimoia mineral field and its intrusive-related gold-copper mineralization style.
High proportions of S and Fe indicate a substantial sulphide content, which may also host high-grade Au potential. This aspect is expected to be an important factor for the airborne geophysical survey interpretation, with such sulphide-rich zones likely to impart a high conductivity signature on the electromagnetic response. The contrast of mainly strongly conductive linear structural zones with the generally resistive host rocks should provide readily identifiable targets for exposure, mapping and sampling leading into drill target definition.
Cu results from outcrop samples on the East Avaninofi ridgeline demonstrate the main mineralization-controlling width and trend (within the dashed lines) along with a scatter of subsidiary (possibly parallel/subparallel) structures. The locations of anomalous Au, Ag and As values have also been added to highlight the association of elements within the main ridgetop zone, estimated to be a 16 m width at this point.
Excavation will continue to open up and expose the northern face of the East Avaninofi prospect, progressively contour benching the downward slope toward the north, with related mapping and sampling expected to extend the strike directions as far as possible. Kainantu has planned for circa two km of excavation and benching at the East Avaninofi prospect in order to define initial drill targets on three different levels nominally spaced 50 m vertically and 100 m laterally. Further benching will likely progress northward as the mineral controlling structures are exposed.
Yaoro Ridge prospect
To the east, the Yaoro Ridge prospect is a north-trending feature immediately adjacent to the East Avaninofi prospect (inclusive of the Tebeo Ridge continuing in a further easterly direction for about 1.75 km). High structural permeability was initially observed in some outcrops and earlier sampling supported further investigation. Upon resolution of interclan matters in this area in Q1, Kainantu has been able to conduct further extensive exploration activities in the area during the period.
Drainage mapping and sampling have now been completed, with a total of 926 rock chip (outcrop and float) soil, stream sediment and pan concentrate samples taken and all results returned.
These included a sample of 4.37 g/t Au, likely derived from the convergence area of the eastern flank of the Yaoro Ridge prospect with the western Tebeo ridge, as the sample is composed of fractured, hydrothermally altered and mineralized hornfels (similar to those found with the highest grades at the East Avaninofi prospect).
Some strongly anomalous Cu and other pathfinder elements were also identified (including a dominant north-trending structural zone hosting up to 0.59 per cent Cu at surface near an old adit area on south Yaoro Ridge). This appears to be a likely extension of a zone of Au anomalies identified in hydrothermally altered breccias to the south and supported by several clusters of gold-in-soil anomalies (20 to 129 ppb Au) and associated elevated As results returned from the southern-trending fingers off the main ridge.
In summary, the sampling results in conjunction with recent mapping indicates lithologies, alteration and mineralization similar to the East Avaninofi prospect, meaning it is highly likely the two prospects are spatially and temporally associated.
Further excavation work is planned in coming months to expose mineralized zones along the eastern flank of Yaoro Ridge, moving in a northerly direction toward Tebeo Ridge. In conjunction with an airborne EM (electromagnetic) and magnetics geophysical survey, the focus will be on defining drill targets in the area in 2022.
Kerefa prospect
Further to the east, the Kerefa prospect was extensively mapped with sampling of 12 costeans and surrounds in H1 2021. Initial sample results identified two apparent trends: (i) extending over 2,600 m in a north-northeast direction, encompassing six widely separated points of anomalous gold-in-soil values between 19 ppb Au and 102 ppb Au; and (ii) a smaller north-northwest trend of outcrops bearing up to 1.92 ppm Au and 1,245 ppm Cu. These samples taken demonstrated epithermal quartz in a hydrothermal breccia. However, a southern cluster of gold-in-soil samples indicated only weakly anomalous Au and Cu results. Relative to the other prospects (and the prospectivity of KRL North), the company has downgrade work at the Kerefa prospect for the time being, enabling Kainantu to focus resources on priority areas.
Next steps
Kainantu remains extremely encouraged by exploration activities at KRL South, especially at the East Avaninofi prospect and Yaoro Ridge prospect.
Notwithstanding COVID-related delays, meaningful progress has been made throughout 2021, in line with Kainantu’s plan to take a focused approach to identify near-term drilling targets at KRL South. Work continues to increase the company’s confidence on the highly prospective nature of the project. For the remainder of the year, the company will continue to undertake excavation work for contour benching and exposure of mineralization; building on sampling data for geochemical analysis, in addition to mapping and modelling.
Given increased confidence, Kainantu is advancing final planning to commence an airborne geophysical (EM and magnetics) program at KRL South in the near future (likely in during December, 2021). This will add a further dimension to Kainantu’s plans to accelerate activities leading to a drilling program in 2022. The company will provide a further update on this initiative in the near future.
Qualified person
The scientific and technical information disclosed in this release has been reviewed and approved by Graeme Fleming, BAppSc, MAIG, an independent qualified person as defined under National Instrument 43-101 (Standards of Disclosure for Mineral Projects).
About Kainantu Resources Ltd.
Kainantu is an Asia-Pacific focused gold mining company with two highly prospective gold projects, KRL South and KRL North, in a premier mining region, the high-grade Kainantu gold district of PNG. Both of Kainantu’s projects show potential to host high-grade epithermal and porphyry mineralization, as seen elsewhere in the district. Kainantu has a highly experienced board and management team with a proven record of working together in the region and an established in-country partner.
About KRL
KRL is an Asia-Pacific focused gold mining company with two highly prospective gold projects, KRL South and KRL North, in a premier mining region, the high-grade Kainantu Gold District of PNG. Both of KRL’s projects show potential to host high-grade epithermal and porphyry mineralization, as seen elsewhere in the district. KRL has a highly experienced board and management team with a proven track record of working together in the region; and an established in-country partner.
Enquiries:
Kainantu Resources
Matthew Salthouse, Chief Executive Officer (Tel: + 65 8318 8125)
Callum Jones, Corporate Development Co-ordinator (Tel: + 61 450 969 697)
Email: info@krl.com.sg
IR / Financial PR: Jemini Capital
Jerry Huang/Kevin Shum
Tel: +1 (647) 725-3888