Grade is king, so for the underground resource of Coyote Central to be ranked amongst the highest-grade deposits in Australia at 356,000oz at 14.6g/t gold has Black Cat purring with delight.
This resource is part of a broader resource of 645,000oz at 5.5 grams per tonne (g/t) gold at the Coyote Gold Operation, the first combined resource estimated at the previously producing project since 2008.
Not only is this a 32% increase from the previous resource, Black Cat Syndicate (ASX:BC8) is also basking in a doubling (101%) of higher confidence Indicated resources, which have sufficient information on geology and grade continuity to support mine planning, to 307,000oz at 5.3g/t gold.
More than half of the Indicated resource is contained within the underground resource – highlighting its outstanding potential.
Likewise, the new Coyote Central open pit has a fully constrained resource of 69,000oz at 2.9g/t gold (80% in the Indicated category) within an optimised pit shell, providing the company with a relatively fuss free option to start production.
All this was achieved at the low cost of just $28/oz, which compares very favourably to MinEx’s estimated average unit discovery cost of US$62 per ounce equivalent in the period from 2009-2018, thanks to the company’s new geological model and highly successful drilling programs targeting the unmined Axial Core Zone.
“With our new geology model and just five months of drilling, we have demonstrated that Coyote Central is one of the highest-grade underground deposits in Australia, containing 356koz @ 14.6g/t gold,” managing director Gareth Solly said.
“We have also substantially increased the total Coyote Central Resource to 424koz @ 8.8g/t gold, with average ounces per vertical metre of >1,000 oz.
“Furthermore, the new Resource currently extends to 400m below surface even though there is known mineralisation down to 700m and remains open beyond that. We expect to further extend the Resource with additional drilling.”
Coyote gold operations
The Coyote gold operations covers 885km2 of highly prospective ground and includes existing open pit and underground workings which historically produced about 211,000oz of gold at an average grade of 4.9g/t gold.
It has been in care and maintenance since 2013 and no systematic exploration was undertaken for about 10 years until the company took over.
While previous interpretations focused on primarily on bedding-parallel mineralisation in the steeply-dipping South Limb of the Coyote Anticline, Black Cat’s interpretation is that mineralisation within the Kavanagh and Speedy resource is hosted within the Axial Core Zone.
This has the potential to host significant mineralisation, a theory that appears to have been borne out by drill results and upgraded resource.
Growth Potential
Black Cat noted that there is a “high level of prospectivity” both around the existing Coyote resource and within the broader region.
The resource is open at depth with high-grade mineralisation intersected about 300m below the current resource.
Additionally, deeper drilling recently intersected a mineralised dolerite intrusion in the core of the Axial Core Zone that returned anomalous gold of up to 0.66g/t.
This result is highly encouraging and broadly similar to what is seen at Newmont’s Oberon deposit (0.4Moz) about 150km along strike to the east, where the margins of the dolerite intrusion are prospective areas for shear hosted gold.
Exploration drilling is planned to further test the region.
This article was developed in collaboration with Black Cat Syndicate, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.