Mongolia re-emerges for the right reasons, page-2

Interesting discovery/prospects as for me,
but basically before any kind of "feasibility" is published it's very, very, very hard to say something meaningful about "potential economical outlooks" etc.
You/one can speculate on much different things, but that you HAVE to have in your cards iMo.

If I look at some mongolian exploration/developments it looks like basically the country is incredible rich in resource prospectivity, buuut a characteristic of most(not all) prospects/discoveries seems to be beeing "rather lower grade".

Are there any "superordinate" reasons(probably; if; in some kind of geological, "earth history", structures etc.) why that is/seems to be the case??

I'm also on the look-out for may copper opportunities.
Midterm, if. Let's say may next 1-3ys.


heres a further article:
Mongolia ready to hitch a ride on copper

http://www.asiaminer.com/features/9208-mongolia-ready-to-hitch-a-ride-on-copper.html#.Wr5J4ZpCTIU

"THE improving copper outlook led by supply dynamics and the positive future for electric vehicles puts Mongolia in a very good position to benefit, enhanced by its location next to the world’s largest copper consumer.

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1	Kincora Copper’s White Pearl exploration camp in the Gobi Desert of southern Mongolia.

This is not only good news for the massive Oyu Tolgoi (OT) Copper-Gold Project, which is majority owned by Rio Tinto through Turquoise Hill Resources, but also for the junior explorers – Xanadu Mines, Kincora Copper and Erdene Resource Development Corp – who have prospective land packages in the country’s south and southwest.
Kincora Copper president and CEO Sam Spring says the outlook for copper is a supply story. “There have been years of under investment and the industry will struggle to keep up.
“Where new discoveries are going to be made is in frontiers like Mongolia. Here you have security of tenure, you can do business and are within trucking distance of the world’s biggest consumer – it is a good place to be.
“If electric vehicles come through and the demand side improves, that is just extra leverage to the story,” he adds.
While Mongolia’s geology or prospectivity hasn’t changed, and its licensing system is barely altered, what has shifted significantly is infrastructure thanks largely to OT and the massive Tavan Tolgoi (TT) Coal Project in the country’s south.
Xanadu Mines Managing Director and CEO Andrew Stewart says infrastructure has come flooding in. “This is what happens when you have discoveries like OT and TT – they generate their own infrastructure.
“In the south, the ground preparation has been made for rail through the region, and I believe in the next two to three years there will be a railway.”

Major mining hubs
Erdene Resource Development Corp’s President and CEO Peter Akerley says there are three major hubs for mining activity in Mongolia. “In the north is the Erdenet copper mine around which are developed and developing coal, iron ore and gold mines that have mature rail, road and power but also some recent rail spurs added and new lines planned.
“In the south, there is the TT-OT hub, which has experienced significant growth in infrastructure and utilities over the past decade with paved highways, rail lines under construction, power plants, major water reservoir development, new power grids and a tremendous increase in trained labour pool.
“As you move west into the south-western Gobi and our focus area, you have a cluster of coal developments controlled by publicly listed and private companies centred on the Narin Sukhait area. These have spurred the construction of paved roads to the border, significant rail construction across the border in China as well as the development of services, handling and storage facilities at Ceke, just across the border in China.
“All of this development contributes ultimately to lower capital and operating costs for all new mining developments through easier access to transportation and utilities, and a much deeper support network of mining services and increased labour supply,” he says.

All about discoveries

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1	Copper concentrate being produced at the Oyu Tolgoi Copper-Gold Project in southern Mongolia.

As a lot of companies around the world seek copper projects, Andrew Stewart says it is all about discoveries.
“The global buzz is the potential for new discoveries mirrored by the situation in Ecuador where there has been a land rush. However, it is much harder to get ground there than in Mongolia. It is also a harder and costlier place to operate.
“In Mongolia, we are drilling some good holes. Other companies are doing the same. The world’s biggest copper producer, Codelco, has some good projects in Ecuador, but is starting to look at Mongolia again.”
He says there is still potential to make some globally significant discoveries, particularly in underexplored places such as Mongolia. “There were seven years of limited exploration. Suddenly, this has changed, with companies beginning to explore.
“The buzz is not quite what it was eight years ago. Owing to the fact that not a lot of exploration has occurred, companies do not have as many projects.
“Everywhere has its challenges for explorers. I have worked in the Philippines, Indonesia, Myanmar, Greece, Bulgaria, Romania, Kazakhstan, China – you name it – but Mongolia is still the easiest place in the world to work in.”
According to Mr Stewart, people will go to great lengths to get discoveries, but different management styles will make things work. “Look at Ecuador – Kinross walked away from Fruta del Norte, yet Lukas Lundin was successful with it. What’s the change? You have different companies with very different philosophies.
“The same applies in Mongolia where you can get things done. Sure, it’s not easy and there is plenty of talk about mineral laws and regulations; however, there is no underground and no reclamation law, so it is about putting things that haven’t been there previously into a law. People say they are concerned about these issues, but getting licences is tough anywhere.
“It now looks like we are in the early stages of a bull market. I think you are dreaming if you can go into any premier copper belt and just pick up licences again.”

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1	Drilling at Xanadu Mines’ Kharmagtai Copper-Gold Project.

Proof of concept
Kincora Copper president and CEO Sam Spring states that apart from infrastructure, another area of change in Mongolia has been proof of concept. “OT has been in production for four years. The underground expansion is the biggest expansion project in the industry by quite some scale, and a number of issues in respect of security of tenure and contract that arose in 2011-2012, have been resolved.
“Unlike Ecuador which is an unproven jurisdiction in terms of building something, Mongolia has proven geology and proven ability to construct things cheaply and quickly compared to industry standards.
“Mongolia is on the doorstep of the world’s biggest consumer of copper. Additionally, a lot of the equipment required to develop and mine the deposits comes from China. There is a trained, skilled labour force and a supply chain that has been developed.”

OT investment saga just a blip

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1	Erdene Resource Development Corp’s suite of prospects is in the country’s southwest.

According to Mr Spring, while the OT investment saga set the country’s economy back and dried up foreign investment, it did not necessarily change Mongolia’s mining industry.
Mr Stewart, however, does not believe that the saga set the OT underground project back as much as believed. “Taking a project from discovery in the early 2000s to understanding that it was a development project in 2006-07, to begin commercial concentrate production four years ago and becoming the world’s biggest underground in the two years, is not slow in typical global mining timeframes.
“The Resolution project in Arizona was found 10 years before OT and they still haven’t turned anything. They are quite different technically, but one is in the US and one is in Mongolia – which one would you say would be developed first?
“For two years most projects around the world were shut down in terms of capex, so is this one any different?”
According to Sam Spring, the perception of global trends and the messages put out by majors have a big impact on investor sentiment, not so much operations. “That is the disconnect. When investors come to the Gobi and see what is going on – the landscape, geology, infrastructure and the amount of activity – they are pleasantly surprised.”
Peter Akerley says, “Apart from infrastructure, the most significant change for Mongolia over the past several years is a greater understanding of the need for renewed investment in the mining industry.
“After reaching globally leading GDP numbers in 2012, the country fell into a rapid downward spiral, reaching near flat growth levels in 2016. This was driven by a number of factors including a new licence moratorium that caused exploration dollars to dry up, some poor policy decisions, lengthy negotiations in regards to the OT deposit, and the downturn in commodity prices and Chinese demand.
“During this period, the leadership in Mongolia – both public and private – has recognised the need to maintain a stable and competitive environment for the mining sector to attract investment and to reignite the exploration side with an injection of new licences.
“Although never a straight line, I would suggest that Mongolia is on the right track from a legal and fiscal perspective to re-establishing confidence in the country as an acceptable jurisdiction to allow for increasing investments to enhance what everyone in the industry recognises is a highly desirable destination for the exploration and discovery of near-surface high-grade gold and copper projects.”

Amazing but tough terrain

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1	A reverse circulation rig at Kincora’s East Tsagaan Survarga prospect.

“It is an amazing, but tough terrain,” Andrew Stewart says. “Because it is a little older, which means that there is much work to do. It is not young terrain like South America, but it has mineralisation all the way from Erdenet in the north, which is younger, to the much older Silurian. There are multiple opportunities to find deposits. Chile is the opposite – Jurassic through to Cretaceous. In both there are big, long periods of mineralisation, which makes them attractive.
“In Mongolia, however, the surface has only just been scratched and very few have walked the ground. There is generally a lot of cover and there are very few outcrops.”
Sam Spring says only 6% of the country has exploration ground available. “The government knows it needs to increase that and has plans to do it once it gets the process right. That is one of the things that helped Ecuador open it and be a bit of a hotspot.
“For new entrants hoping to find a way in, if only 6% of the country is available, it is not enough, particularly now the commodity cycle has turned into a tailwind.”

A gold discovery with copper
Andrew Stewart says it has been a little frustrating trying to get the market to understand what Xanadu is doing. “We liked Kharmagtai, because it had high-grade potential, was under-explored and importantly was shallow. It had all the right hallmarks of what you want to see, but was always going to take a few years to deliver on what we believed.
“It is a project that requires a fair bit of drilling, which we are doing with three or four rigs. It is a gold discovery in drag – a gold discovery with copper. We have multiple zones of 400 metres at 2 g/t gold with a by-product.
“Suddenly, ore bodies with 1 g/t gold are fashionable globally, whereas it used to be 5g/t. However, we are drilling holes with 2 g/t and have copper as well.”

Potential for discoveries

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1	A number of deposits have been identified on Xanadu’s Kharmagtai project.

Peter Akerley says the team at Erdene has been involved in Mongolia for 20 years, spending this time studying the country’s geology and mineral potential.
“Through this work, we have established an area of southwest Mongolia as an area that we believe provides us with the greatest potential for the discovery of high-grade gold deposits and significant potential for porphyry copper opportunities, perhaps rivalling that of southeast Mongolia.
“This work has generated three deposits and, given its high fertility, has the potential to be much more productive. This geologic understanding, our competitive advantage – given the land position – and history in the belt, as well as our established base in that area and in those communities, will keep us focused in this region for many years to come.”

Xanadu extends White Hill
Diamond drilling at Xanadu Mines’ Kharmagtai Copper-Gold Project has extended mineralisation beneath the maiden resource at White Hill deposit. A drill hole has intersected 850 metres from surface at 0.32% copper and 0.2 g/t gold, or 0.45% copper equivalent.

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1	A geology and drill hole map from Erdene’s Bayan Khundii project.

Drilling is targeting extensions of copper and gold mineralisation along strike and below the current resources.
The 850-metre intersection included 282 metres from 560 metres at 0.44% copper and 0.16 g/t gold, or 0.55% copper equivalent. The hole added over 380 metres of previously unknown mineralisation.
Deeper parts of the hole contained significant potassic alteration and bornite mineralisation, which suggests the hole is vectoring towards deeper, higher grade porphyry copper and gold mineralisation.
Additionally, the hole was terminated within a post mineral dyke, indicating mineralisation should be open at depth below this dyke.
Andrew Stewart commented, “We are excited by this new drilling beneath the maiden White Hill resource, as it has extended the zone of mineralisation. More significantly, it has intersected bornite and extensive potassic alteration, which could be the precursor to the discovery of a higher-grade system adjacent to the established resources.”
White Hill is one of three porphyry deposits, all near each other, that make up the Kharmagtai project. The deposits have a combined JORC resource of 203 million tonnes at 0.34% copper and 0.33 g/t gold for around 1.1 million tonnes of copper equivalent.
Unlike the nearby Copper Hill and Stockwork Hill deposits, White Hill has had sparse drilling and there remains good potential for high-grade zones of mineralisation within the current drill pattern.

Encouraging Erdene drilling

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1	Core samples from Kincora’s drilling program in the South Gobi.

Drilling by Erdene in 2017 supported the presence of multiple, near-surface, very high-grade zones outside of the main Midfield and Striker zones at the Bayan Khundii project.
Best results received in early December were 61 metres at 4.2 g/t gold, including 1 metre at 111 g/t in Striker Zone; 15 metres at 9.2 g/t, including 1 metre at 116 g/t 250 metres west of Striker; 23 metres at 6.7 g/t, including 1 metre at 139 g/t between Striker and Midfield; and 93 metres at 1.5 g/t 225 metres north of Midfield.
At the time, Peter Akerley said, “Results include many intervals with ounce to multi-ounce gold intersections, including some in areas not previously identified as high-grade, such as north of Midfield, west of Striker and near-surface between Midfield and Striker.
“Additionally, closer spaced drilling within the Striker and the Striker-Midfield areas continues to deliver excellent results, confirming strong continuity of these very high-grade gold domains.
“This, coupled with recently completed quarter 4 drilling results at our neighbouring Altan Nar project, and recent high-grade sampling results north of Bayan Khundii, display the tremendous upside potential of this new district.”
During the March quarter, the company’s technical team will assess the 2017 drill and exploration programs and determine what additional drilling may be required prior to an independent resource evaluation.
Timing of the eventual resource studies for Bayan Khundii and Altan Nar will be influenced by that determination. It is anticipated, however, that the studies will be completed between quarter 2 and quarter 3 of 2018.

Kincora reviews Bronze Fox

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1	Among the major areas of focus on Xanadu’s Kharmagtai project.

Kincora Copper has appointed Mining Associates to undertake a review of its Bronze Fox Copper-Gold Porphyry Project. The review will provide an independent resource model and assist in future exploration.
A 3D block model is expected to support tonnage and grade estimates, and provide parameters for future exploration and a potential NI 43-101 compliant resource.
Bronze Fox has an extensive mineralised footprint covering more than 40km2 at the Bronze Fox Intrusive Complex (BFIC) and 15km2 at the neighbouring Tourmaline Hills Intrusive Complex (THIC).
Two active and unencumbered drilling exploration field seasons have been carried out across the portfolio that hosts the full BFIC. Total drilling by Kincora and others covers 169 holes for 55,908 metres.
Efforts have focused on the western central portion of the BFIC where 75 holes for 23,130 metres have been drilled across a 1.4km by 2.4km zone, with mineralisation encountered often from surface to a maximum vertical depth of over 1km. Best results were 391 metres at 0.50% copper equivalent, including 37 metres at 0.83% copper for 1.01% copper equivalent; and 112 metres at 0.50% copper equivalent, including 32 metres at 0.37% copper for 0.91% copper equivalent.
Sam Spring said, “There is a substantial copper-gold system at the western central portion of the BFIC, within the larger two mineralised intrusions at Bronze Fox.
“With unencumbered access to both licences and an improved copper price, the review is expected to independently quantify the previous discovery, which will assist valuations to peers, define areas of potential higher grade and adjacent exploration targets that may justify further drilling to expand the mineralised system and define a maiden NI 43-101 compliant resource.
“Relative to the other copper-gold projects in the wider belt that have existing resources, Bronze Fox has had modest previous drilling.”"