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Weekly UpdatesJunior miner Planet Exploration is proving there is still high grade mineable reserves to be found in the already established gold camp of the Red Lake Mining District.
The Calgary-based firm has spent 10 years working one project, their Sidace Lake property, located 30 kilometres northeast of the town of Red Lake.
It's taken that long just to figure out the complex geology inside one of the most prolific and profitable gold camps in the world.
But to Planet Exploration director Salim Jivraq, the question of whether Sidace Lake has the potential to be the next big producer is a no-doubter with good showings at 400 metres.
"But the question is how deep do you go? And that's what mining is about."
The company has found good gold values at two locations, their Main Discovery Zone (MDZ) and their Upper Duck Zone, about a kilometre away.
Their joint venture partner, Goldcorp, has a 60 per cent stake in the venture, including a 15 per cent interest in Planet. The big miner has also invested more than $25 million in the property within the last decade.
"The potential is just phenomenal," said Jivraq.
More than 85 holes have been drilled over the years and 80,000 metres just in those two zones.
Both are different in geology and the two locations are not part of same vein. Jivraj called the MDZ a "Hemlo-like formation" that produces better grades and a greater resource as exploration goes deeper.
The MDZ is a gold-bearing arsenopyritic fold with a quartz-sericite schist, while the Upper Duck consists of thick ironstone material with good grades of gold.
Jivraj said there's no question the property has a mineable reserve, especially given Goldcorp's interest.
Drills results from three holes at Upper Duck taken last summer yielded gold values of 17.07 grams per tonne over three metres.
"We've got other zones in our property that wherever we've drilled have got good value but different geology," including their Anderson Zone, which shows similar geology to Goldcorp's Red Lake Mine.
The company is preparing a bankable resource calculation, a Ni 43-101, expected out this winter. "This is the first one we've ever done," said Jivraj.
It will be restricted to the 400 to 500 metre range below surface where there the greatest concentration of drill holes at both locations.
"Our grade calculations will be based on a grade cutoff that will be totally mineable."
Deeper, stand-alone holes, some as far down as 1,300 metres, are showing higher grades at depth.
Last year, the partners drilled 15,000 metres on the property. This winter, the company is deep drilling both zones, and expanding exploration to the east and west.
The summer 2009 exploration plans and budget will be drawn up and adjusted based on what Goldcorp's plans are. The intention is to start deeper and more detailed drilling at the MDZ.
Jivraj said once the 43-101 is available, the company will start planning its exit strategy from the partnership. "We're an explorer company, we don't want to be a miner."
Jivraj said Goldcorp intends to place an exploration ramp somewhere on the property. Environmental studies are underway and the big miner has plans to build a 40,000-tonne mill nearby.
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With a treasury of about $6 million, Jivraj said the company remains very frugal and careful on spending money. "We don't spent money that doesn't create us value."
The property was originally held by Corsair Exploration, an oil and gas company that briefly dallied in mining. Corsair sold off their interest to Planet, which was one of their public companies. Jivraj was part of the Corsair group.
Some exploration was done on the property more than 15 years ago with only a handful of holes drilled by another exploration firm.
Planet Exploration Inc.
Ranjeet Sundher, President
TSX Venture Exchange: PXI
52 week high: $0.80
52 week low: $0.34
Projects: Sidace Lake, gold (Red Lake, Ont)
Arganlant (Ovoot) gold-copper (Mongolia)
www.planetexploration.net
By IAN ROSS
Northern Ontario Business
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