MOD Resources hits gold via deep drilling

THE DRILL SERGEANT: MOD Resources (ASX: MOD) has encountered intersections of gold mineralisation while conducting deeper drilling of the Main Zone gold deposit at the company’s Sams Creek gold project in New Zealand.

The company said most of the drill holes it has completed in the Stage 2 program have intersected wide zones of moderate (2-3 grams per tonne) and locally-high (greater than 4g/t) grade gold mineralisation.

MOD explained this has supported its view that drilling it has carried out so far may have tested only part of what it considers to be a potentially large porphyry gold system.

MOD has now completed the Stage 2 drilling program it had designed to infill the current resource and upgrade 550,000 ounces of gold into the Indicated Mineral Resource category.

The resource upgrade is the main prerequisite for the company to increase its interest in Sams Creek to 60 per cent under the agreement it has with OceanaGold Corporation.

The agreement enables MOD to earn up to 80 per cent in the joint venture.

Latest results received by the company include:

–    63 metres at 2.4 grams per tonne gold from 197 metres including, 11 metres at 4 grams per tonne from 249 metres;

–    1.1m at 3.6g/t gold from 128.9m, including 6m at 11.5g/t from 147m; and

–    14.5m at 2g/t gold from 257m down hole depth.

“The Stage 2 drilling program at Sams Creek has been a great success,” MOD Resources managing director Julian Hanna said in the company’s announcement to the Australian Securities Exchange.

“Drilling was completed on budget and conducted to high safety and environmental standards, which is a credit to the project manager Paul Angus and his technical team on site.

“Drilling has produced very encouraging results, exceeded our expectations in terms of width and grade and has resulted in a far better understanding of the geometry of the Main Zone deposit.”