Xanadu Mines (ASX: XAM) has identified key follow-up targets at its Red Mountain project in Mongolia after returning positive copper and gold results from near-surface in a discovery drill campaign across four prospects.
The company recorded epithermal gold extensions in shallow mineralisation at its promising Target 33 prospect, with assay highlights showing a 41m hit grading 1.07 grams per tonne gold from 34m. The 41m intercept included a 5m section at 2.67g/t gold from 38m, in addition to a slightly deeper 6m intersection going 2.28g/t from 58m.
A second hole also delivered encouraging results, with 29m at 0.54g/t gold from just 4m including 4.1m going 1.39g/t from 18m.
Maiden drilling at Xanadu’s Nowie prospect delivered an 8m section grading 1 per cent copper and 0.12g/t gold from 267m, with a second hole at the site returning 14m at 0.75 per cent copper and 0.26g/t gold from 113m.
The latest results come from a recently-completed, 4880m diamond drill program at Red Mountain that was designed to test for shallow high-grade gold and copper-gold targets. The campaign also targeted copper-gold porphyry extensions at two prospects, with assays showing a 4m section going 0.85 per cent copper and 1.52g/t gold from 186m at its Target 10 prospect.
The Bavuu copper-gold porphyry target also returned positive assays, with a 9.5m hit at 0.47 per cent copper and 0.21g/t gold from 110.3m. The company already has a 30-year mining licence granted for the 57-square-kilometre operation.
At Target 33, drilling continues to define multiple broad zones of near-surface gold mineralisation that remain open along strike. The first drilling at Nowie has been very encouraging, returning broad intervals of copper and gold, including several narrower intervals of higher-grade copper, demonstrating both scale and grade potential.
Xanadu Mines vice-president of exploration Dr Andrew Stewart
Management believes Red Mountain shares geological similarities with Evolution Mining’s Northparkes copper-gold porphyry deposits in New South Wales, which in 2022 held an estimated mineral resource of 526.9 million tonnes at 0.55 per cent copper, 0.19g/t gold and 1.87g/t silver.
The operation sits to the east of Xanadu’s flagship Kharmagtai project that hosts a massive mineral resource of 1.3 billion tonnes at 0.3 per cent copper and 0.2g/t gold for 3.4 million tonnes of contained copper and 8.5 million gold ounces. The total resource includes 52 million tonnes of oxide material, primarily in the top 20m from the surface.
Last year, the company completed two phases of its strategic partnership with China’s giant Zinjin Mining Group, providing access to funding for its ongoing exploration blitz. The deal saw Zijin invest US$35 million (AU$52 million), which will also be used to complete the Kharmagtai preliminary feasibility study (PFS).
A 50:50 joint venture (JV) has been created between the two partners at a project level, with Xanadu the operator on the ground. The partnership has allocated 18 months to knock over the PFS for Kharmagtai, which is expected to be completed this year.
The company had planned to target its Stockwork Hill prospect with the latest round of drilling, but switched the metres to Target 33 after recording the promising initial results.
Following the solid range of copper and gold results from its latest campaign at Red Mountain, Xanadu already has its eye on making a significant discovery when it kicks off its follow-up drill program in the second half of this year.
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