Wednesday, March 2, 2016

Xanadu Mines on bonanza gold discovery streak in Mongolia

Xanadu Mines (ASX:XAM) has revealed some spectacular rock chips from the newly discovered quartz-carbonate-sulphide veins at Oyut Ulaan copper-gold project (90% XAM), which is located within the Dornogovi Province of southern Mongolia.

Bonanza grade results include: 305.8g/t gold, 171.6g/t gold and 123.2g/t gold.

The multiple high-grade rock chip samples define three parallel epithermal lode structures within 1.5 kilometres.

News flow will remain strong in the near-term, as Xanadu has trench and detailed channel sampling in progress, before drilling is planned.

Dr. Andrew Stewart, chief executive officer, commented:

“It is very exciting to collect true bonanza gold grades from newly discovered mineralisation at Oyut Ulaan.

"We had the belief the geology displayed all the ingredients required for significant shallow high-grade gold mineralisation, which has been confirmed by this surface sampling.

"The team is now developing plans for accelerated exploration as there is tremendous scope for a very significant discovery in this area.”

Rock chip details

Xanadu said that the majority of the new results are from sampling surface outcrops and sub crops that occur south of known porphyry mineralisation at Diorite Hill and Stockwork Hill.

The style of mineralisation indicates a potential link between known gold-rich porphyry copper mineralisation and newly discovered veins.

A total of 157 rock chips samples were collected from out cropping and sub cropping veins across three main zones.

The majority of samples returned highly anomalous values, 57.9% of samples graded more than 1g/t gold.

Significantly a total of 56 samples returned grades higher than 10g/t gold and 8 samples returned more than 100g/t gold.

Oyut Ulaan is a strategic asset

The project is strategically located within the South Gobi Copper Belt, which hosts the world class Oyu Tolgoi copper-gold project, and 260 kilometres east of Xanadu’s flagship Kharmagtai copper-gold project.

Oyut Ulaan comprises a large and underexplored porphyry district covering 40 square kilometres, and consists of multiple co-genetic porphyry copper-gold centres, mineralised tourmaline breccia pipes and copper-gold/base metal magnetite skarns.

Analysis

While early days at Oyut Ulaan, the potential is off the charts considering of 157 rock chip samples, 56 returned grades above 10g/t gold, and eight more than 100g/t gold.

Exploration news flow will also remain strong in the near-term, as Xanadu has trench and detailed channel sampling in progress, before drilling is planned.

Last month, Bell Potter retained its Speculative Buy rating and increased its forward valuation of the company by 6% to $0.35 per share.

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