By The Tail At Eagle Eye And A Possible Gold Mine At Miyab
What with an extended rainy season, lack of drills and a queue a mile long at the assay lab it is not surprising that news from AIM listed African Eagle has been a bit sparse over the last few months. The share price suffered as impatient investors tried to make a fortune elsewhere, but they will probably now be wishing that they had stayed put as the company has released very encouraging news from both its Miyabi gold project in Tanzania and the Eagle Eye copper and gold project in Zambia. In the event the company wrong footed one or two commentators as the biggest expectations had been built up for Eagle Eye, but it is Miyabi which now shows every indication of becoming a mine. As a result African Eagle has swiftly made the flight from pure explorer to developer and the share price has been trying to catch up.
The drilling that has taken place at Miyabi has been concentrating on the Faida area in the south east of the Miyabi mineralised corridor. The object was to gain an accurate view of the stratigraphy and occurrence and nature of the gold mineralisation for input into a new resource calculation. The results speak for themselves. One hole intersected 58.3 metres grading 4.03 g/t gold, including a higher grade zone of 22.5 metres at 7.11 g/t which itself included an even higher grade intersection of 12.8 metres at 11.54 g/t. Another hole to the north ntersected 60.7 metres at 1.57g/t, including a central zone of 32.0 metres at 2.09 g/t and a third to the to the northeast intersected 61.2 metres grading 1.63 g/t, including 28.8 metres at 2.22 g/t.
The conclusions reached by the African Eagle team is that the holes drilled so far show that the gold mineralised zone has a true thickness of between 27 and 60 metres, a strike length of at least 300 metres and extends to a vertical depth of at least 120 metres. Geophysical surveys and soil geochemistry suggest that the mineralisation extends over at least 500 metres. Mark Parker, managing director, points to the results from the first hole as being significant as they appear to reveal a higher grade ‘ore shoot’ within the Faida gold zone. He goes on to point out that shoots of this type can add greatly to the total resource ounces of gold in a project but they may be only 100 to 200 metres long and 20 to 50 metres thick, which makes them difficult to find except by sustained and systematic drilling
Early in 2005 the company will complete the new resource estimate and it will obviously be whole lot bigger than the 140,000 ozs presently ascribed to Miyabi as it includes nothing from Faida. This is only the beginning, however, as Mark Parker believes that the gold-bearing corridor at Miyabi, which is 7kms in length and 2 kms wide, has the potential to host other important gold structures of the Faida type. A comprehensive database of geophysical, geological and geochemical data has been built up which will now be used to identify and target other possible gold structures for drilling. More work will also be carried out at Faida which is open at depth and to the east and may also be open to the west. These latest results also suggest that the gold mineralisation increases with depth and may plunge to the east.
The announcement about progress at the Eagle Eye project in Zambia actually contains the words ‘Iron Oxide Copper Gold deposits’ and the eyes of analysts will have been drawn to this very swiftly. The basic news is that the continuing geochemical, geophysical and other surveys show that zones of copper mineralisation and geochemically anomalous soils are considerably more extensive than previously considered. Newly defined zones identified from recent geochemical analysis of soils correspond to a major fold structure seen on the aeromagnetics and in the geological mapping. This fold structure is believed to be a favourable trap-site for potential mineralisation and the hinge of the fold is defined by a magnetic high on the airborne imagery suggesting a large zone of iron alteration characteristic of Iron Oxide Copper Gold Deposits.
Such deposits tend to be big and there are only about half a dozen in the world; Australia has two of them and Africa none. Olympic Dam has a resource of around 1 billion tonnes of copper and gold and Ernest Henry 170 million tonnes. People close to African Eagle see geological similarities with Ernest Henry which is a dipping breccia style deposit. To give an idea of scale it extracts 10 million tonnes/year of ore from an open pit operation and produces around 360,000 tonnes of concentrate containing 100,000 tonnes of copper and 125,000 ounces of gold a year..
Investors should not get over-excited as it is still early days. Eagle Eye has yet to determine priority targets over the fold hinge for drilling in 2005, but it is encouraging that first pass trenching along the northern limb of the fold structure near the hinge zone has returned 1.07% copper over 6 metres. As to size, well the new zones of copper mineralisation and anomalous soil geochemistry define the entire fold structure, which extends for some 13kms from the Eagle Eye/Mweze prospects on the north-western portion of the fold limb to the historic Sasare Gold Mine on the margin of the south-eastern limb. Chris Davies, operations director, reckons that the copper mineralisation in the soils extends for 25 kms. Time and Dr Drill will tell, but Eagle Eye has now moved up a league..