Significant Oxide Gold Intersects Returned From Copper Hill

TORONTO - Xanadu Mines Ltd reported that recent diamond drilling has intersected wide zones of strong oxide gold mineralization above the current Mineral Resource at the Copper Hill deposit at its flagship Kharmagtai Project in southern Mongolia. “Results are very encouraging and demonstrate excellent potential for a shallow oxide resource,”

said, Xanadu’s Chief Executive Officer, Dr Andrew Stewart. “We are very pleased by the first drill results from the oxide zone at Copper Hill. What encourages us most by what we see at Stockwork Hill, Golden Eagle and now Copper Hill is the grade and potential scale and strike extent of the oxide system. While further drilling is required across the resource as the project advances, these new intersections of significant widths of shallow oxide mineralization highlight the potential and show that we have just scratched the surface in terms of the broader resource potential. Further, it represents the opportunity for a low cost, high-value gold gravity and leach operation which could be run early in the development life of Kharmagtai, injecting significant cash into the project to offset the cost of developing a large-scale copper-gold mine.

Given Kharmagtai sits on a granted mining lease with a registered water resource and an established power supply nearby, we have the ability to move quickly on an oxide gold project, and our current strategy of seeking high-return options via an oxide gold project is focused on providing the capital needed to advance that larger scale copper and gold project.”

A four-hole program has been completed at Copper Hill to expand the gold-rich core and confirm continuity of oxide gold mineralization.  Previous drilling at Copper Hill was offset from potential shallow mineralization as explorers targeted deeper sulphide.  As such the oxide and transitional gold potential of the deposit is yet to be assessed. Holes are vertical PQ drill holes with 25m spacing.  The objective of this drilling was to identify, expand this oxide mineralization, test continuity and gain an understanding of the oxide-transitional zone mineralogy and distribution so that accurate metallurgy can be obtained. 

Copper Hill consists of the highest-grade zone of copper-gold mineralization at Kharmagtai where very high-density vein hosted sulphide mineralization occurs over a 200m by 100m pod that plunges to approximately 300m in depth. Near surface mineralization at Copper Hill has been largely undrilled as previous drilling is stepped back from the surface to target the deeper sulphide.  This has left an opportunity for oxide and transitional gold un-tested.  As this material will need to be mined during open pitting of Copper Hill and the oxide gold potential must be tested.  The current drill program confirms the presence of both oxide and transitional gold.  The next steps will be to conduct metallurgy to assess the viability of gravity separation versus leaching.