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May 2013 - Indochine Mining

Indochine Mining Limited (IDC) – Focusing on its Bonanza Grade ore zones to upgrade its Mt Kare ore resources by mid-2013

  • Indochine currently owns 100% of the Mt Kare gold-silver Project in the Highlands of PNG ~15km SW of Barrick's ~0.5mozpa Porgera gold mine. Indochine completed its scoping study / PFS in October 2012, and is in the process of revising its resource model and undergoing other studies as part of its aim to complete a BFS in early 2014 and then submit its ML application.
  • Although dated 2011, the current resource model was mostly based on 2007 information. Since then, bonanza (typically roscoelite) zones in both the WRZ and BZ zones have been identified extending across sections with intersections such as 4m @ 420g/tAu, 5m @ 120g/tAu, 5m @ 105g/tAu, 7m @ 35g/tAu etc. Such intersections could upgrade the current 2.1moz total resource of 28.3mt @ 1.9g/tAu (2.3g/t Au equiv), of which 5.9mt @ 3.7g/tAu is an indicated resource.
  • The PFS identified a viable project capable of producing >100,000ozpa for at least 8.5 years through a ~1.7mtpa plant (our model estimates are ~110,000ozpa to 150,000ozpaAu).  The project envisaged a two stage construction, the first being based on treating the oxide ore (which appears to mostly be at least ~50m deep) for ~$260m conservative capex, followed by possibly biox/flotation treatment of the sulphide for an additional $90m. Additionally there could be a near surface nugget and/or flaky visible gold effect, which was not included in the PFS.
  • Two of the key issues for mining projects in PNG are resolving landowner rights and tailings disposal. Indochine are applying the similar Melanesian approach successfully applied at Hidden Valley (by the same person) to resolve landowner rights. Tailings disposal has been proposed (like HV) over a nearby open valley.
  • Written by: Keith Goode
  • Wednesday, 01 May 2013