Gold producer Alkane Resources (ASX:ALK) has discovered a potentially massive porphyry gold-copper system in Central NSW.

The 110sqkm Northern Molong porphyry project (NMPP) is in the same neighbourhood as Newcrest Mining’s (ASX:NCM) mammoth Cadia Valley porphyry operations.

Alkane just hit an incredible 502m at 0.48 grams per tonne (g/t) gold and 0.2 per cent copper, 211m from surface, at its Boda prospect.

This mineralisation remain open at depth and along strike, the company says.

We’re often told “grade is king” (which isn’t really true by the way) so those gold and copper grades might not sound that exciting.

But because of their easy-mining large volumes, porphyry orebodies can be economic from copper concentrations as low as 0.15 per cent.

Just look at the buzz surrounding Hot Chili’s Cortadera copper-gold discovery in Chile, or Solgold’s advanced porphyry discovery in Ecuador.

Alkane says there’s “several apparent similarities” between Boda and the upper sections of Newcrest’s nearby Cadia East deposit.

“These drill results suggest a significant and exciting discovery in a region that has a history of delivering large, low-grade and long-life gold-copper mines,” Alkane boss Nic Earner says.

“The project area has already delivered some strong indications of a big porphyry system near surface at Kaiser and, along with the results from this diamond drill hole at Boda, we can see clear evidence of Cadia-style mineralisation and grade over hundreds of metres.

“Alkane is immediately prioritising follow up drilling, seeking to determine the scale of this highly encouraging discovery.”


Ahead of the game

Alkane was (and still is) sitting pretty, despite the disruptive transition from open pit to underground mining at its Tomingley Operations in NSW.

The company just delivered a clear profit of $23.3m for FY19, a 28 per cent drop on the prior year as it processed medium and low-grade ore stockpiles.

Still, Alkane has plenty in the bank, with cash, bullion and listed investments totalling $80.8m at the end of July.