August 23rd, 2016 ASX Release
DRILLING UNDERWAY AT ALL FOUR COPPER-GOLD PROSPECTS IN THE SOUTH OF PERU
AusQuest Limited (ASX: AQD) is pleased to advise that initial drilling has now commenced at all four prospects in the Ilo area of southern Peru under the Cardonal-Ventana and Puite- Colorada Joint Ventures with Compania Minera Zahena SAC ("Zahena").
Three drill rigs are currently operating in the area with two now working at the Ventana prospect and one at the Colorada prospect. A total of ~8,000m out of a possible 20,000m have been completed to date with 13 holes (out of a possible 38) drilled within the four prospect areas (Puite - 6; Colorada - 3; Cardonal - 2; and Ventana - 2).
Drill-hole separations vary from ~400m to 800m, highlighting the reconnaissance nature of this program (see Figure 1).
Figure 1: Prospect and drill-hole locations in the Ilo area
Preliminary drill logs for 11 of the 13 holes completed and assay results for 7 of the holes completed have been received to date, suggesting that a porphyry deposit(s) could occur within the general joint venture area.
This conclusion is supported by the varying styles and intensity of alteration intersected by the initial drilling, including more distal sub-propylitic alteration and the more proximal propylitic and potassic (weak) phases in some drill-holes.
Copper oxides and copper sulphides have so far been found at two of the prospects (Ventana and Puite) in trace amounts, with maximum grades up to 0.16% Cu where sulphides have been reported, and anomalous values up to ~500ppm Cu where copper oxides are visible along fractures.
At the Puite Prospect, preliminary geological reports from the six drill-holes (PUT01, 02, 03, 05, 06 and 08) indicate the presence of porphyry-style alteration (weak sub-propylitic to strong propylitic) within diorite host rocks, suggesting the potential for a porphyry copper system located nearby.
Visual copper minerals were reported in trace amounts within veinlets and on fracture surfaces within the altered diorite. Assays from the first five holes (PUT01, 02, 03, 05 and 06) indicate the presence of elevated levels of copper in holes PUT02 and 05 with average values of up to 0.12% Cu over thicknesses of ~15m associated with propylitic alteration within the dioritic host rock.
Drill-holes PUT05 and 06, which were sited to test a magnetic target associated with anomalous copper in soils, intersected disseminated and vein magnetite which appears to be part of an alteration assemblage, and trace amounts of pyrite and chalcopyrite within altered diorite in drill-hole PUT05.
Drill-hole PUT08 located ~800m to the west of hole PUT05 intersected similar alteration to that found in hole 05, suggesting that the alteration could extend over a strike length of at least 1000m. Assay results for PUT08 are still pending. A more complete assessment of the Puite prospect will be possible once all drill results are available.
Drilling at the remaining three prospects is still at an early stage, with two holes completed at Cardonal (CAR01 and 04) and Ventana (VEN07 and 13) and three holes completed at Colorada (COL11, 15 and 19). Porphyry-style alteration has been intersected at each prospect with trace amounts of copper oxide and sulphide evident within drill-hole VEN07 at Ventana. A full complement of drill logs and assay results are awaited and drilling is continuing.
The Company is pleased that drilling has now commenced at all four copper-gold prospects in the Ilo area and is progressing at a steady pace. The Company looks forward to providing updates on the drilling programme as further information becomes available and a more complete assessment is possible.
Graeme Drew
Managing Director
COMPETENT PERSON'S STATEMENT
The details contained in this report that pertain to exploration results are based upon information compiled by Mr Graeme Drew, a full-time employee of AusQuest Limited. Mr Drew is a Fellow of the Australasian Institute of Mining and Metallurgy (AUSIMM) and has sufficient experience in the activity which he is undertaking to qualify as a Competent Person
as defined in the December 2012 edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" (JORC Code). Mr Drew consents to the inclusion in the report of the matters based upon his information in the form and context in which it appears.
FORWARD LOOKING STATEMENT
This report contains forward looking statements concerning the projects owned by AusQuest Limited. Statements concerning mining reserves and resources may also be deemed to be forward looking statements in that they involve estimates based on specific assumptions. Forward-looking statements are not statements of historical fact and actual events and results may differ materially from those described in the forward looking statements as a result of a variety of risks, uncertainties and other factors. Forward looking statements are based on management's beliefs, opinions and estimates as of the dates the forward looking statements are made and no obligation is assumed to update forward looking statements if these beliefs, opinions and estimates should change or to reflect other future developments.
Drilling at Ventana -Drill-hole VEN 13
Drilling at Colorada -Drill-hole COL 11
JORC Code, 2012 Edition - Table 1 report, Diamond Drilling in southern Peru
Section 1 Sampling Techniques and Data
(Criteria in this section apply to all succeeding sections.)
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Criteria
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JORC Code explanation
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Commentary
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Sampling techniques
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Nature and quality of sampling (eg cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling.
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Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used.
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Aspects of the determination of mineralisation that are Material to the Public Report.
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In cases where 'industry standard' work has been done this would be relatively simple (eg 'reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay'). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (eg submarine nodules) may warrant disclosure of detailed information.
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The entire cored hole is sampled. Composite samples are collected over 3 metre intervals.
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Core is cut in half using a hydraulic press with half sent for analysis and half retained for geological and quality control purposes
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Sample intervals are measured by tape from depth intervals shown on core blocks labeled by the drillers, as per standard industry practice.
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Drilling techniques
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Drill type (eg core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (eg core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc).
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Diamond Drilling to produce continuous core.
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HQ and NQ drill rods used to produce 63.5mm and 47.6mm diameter core respectively. The hole starts with HQ core and changes to NQ at the appropriate depth depending on drilling conditions.
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Down-hole surveys are read at ~ 50m intervals.
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Drill sample recovery
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Method of recording and assessing core and chip sample recoveries and results assessed.
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Measures taken to maximise sample recovery and ensure representative nature of the samples.
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Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material.
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Core recovery is determined by comparing core lengths measured against drilled intervals shown on core blocks and recorded on the logs.
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Experienced diamond drillers are engaged to ensure maximum core recovery.
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Sample recovery is high negating any sample bias due to recovery.
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Logging
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Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies.
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Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc)
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Drill core and sample chips are logged by experienced geologists to identify key rock types, alteration and mineralisation styles.
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Core logging is qualitative with visual estimates of
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