IRW-Press: Altona Mining Limited: Kylylahti Resources Increased



Published on 26 March 2014


by Press Office

(IRW-PRESS and WireNews+Co)

Vienna, Austria


Altona Mining Limited (“Altona” or the “Company”) is pleased to announce an increased Mineral Resource for the 100% owned Kylylahti underground mine at its Outokumpu Copper Project in Finland. This is the regular update of Mineral Resources that Altona undertakes in conjunction with annual and half year reporting. The Resource estimate for the Kylylahti mine is:

• 8.8 million tonnes at 1.33% copper, 0.78 g/t gold and 0.54% zinc.

• Contained metal in this resource is 117,480 tonnes of copper, 222,595 ounces of gold and 47,401 tonnes of zinc.

• This equates to 161,000 tonnes of copper equivalent metal determined by using actual Net Smelter Return to estimate revenues from concentrate sales*.

The previous estimate was reported on 29 August 2013 and is 7.7 million tonnes at 1.31% copper, 0.68g/t gold and 0.52% zinc for 100,670 tonnes of copper, 167,850 ounces of gold and 40,360 tonnes of zinc being 134,000 tonnes copper equivalent.

Resources are reported above a 0.4% copper lower cut-off grade and include mine depletion to 31 December 2013.

Reserve estimates based on this resource are in progress.

The Mineral Resource tonnage has increased by 15%, copper metal by 17% and copper equivalent metal by 20% compared to the 30 June 2013 estimate. The Kylylahti mine has 5% more resource tonnes, 12% more copper metal with 6% higher copper grade, compared to estimates before mining started despite the production of 18,000 tonnes of copper since production commenced in February 2012.

The longitudinal section (Figure 1) on page 4 highlights the potential for further depth extensions to the Kylylahti deposit.

* Formula reported at end of release.

Mineral Resource Estimates since commencing production

Copper metal in the Kylylahti mine mineral resource inventory. Copper metal in the resources is depleted by the production to 31 December 2013. Copper equivalent metal is gold, zinc and silver expressed as copper revenue; the calculation is explained on page 8.

Copper Metal with Depth

Copper metal (right hand scale) and grade (% on left hand scale) in the Kylylahti mine mineral resource inventory in 25 metre vertical levels (RL). Copper metal in the resources is depleted by production to 31 December 2013. Note the increase in copper grade from -600 metres RL. The decline in contained copper metal from -750 RL is a function of drilling density.

During the period 1 July 2013 to 31 December 2013, mining depleted the resource by 0.33 million tonnes at a grade of 1.66% copper. Additions to the resource have come from:

• Drilling at the lower limit of the deposit intersected mineralisation below previous drilling. The highlight of the campaign was an intercept of 108 metres at 2.4% copper including 58 metres at 4.2% copper reported on 26 November 2013.

• Delineation of hanging-wall gold-copper-nickel ore shoots.

• Delineation of the new nickel zone reported in the September 2013 Quarterly report.

• High grade underground definition drilling in the top most part of the Wombat zone.

• Improved geological understanding of deposit geometry, structure and continuity of high-grade zones.

The graph on the prior page shows the increase in copper metal per vertical metre below where the Wombat zone commences. It also highlights the marked increase in grade at depth from 600 metres deep (Figure 2). The mine decline is now some 583 metres below surface (Figure 1).

Now that the deposit has been exposed underground, has been mined for two years and has had close spaced drilling, it is clear that the Kylylahti deposit is different from what was expected at the Feasibility stage.

Semi-massive sulphides have proven to be more continuous than the pre-mining resource drilling indicated and disseminated sulphides have proven to be less extensive. In the pre-mining model some 75,000 tonnes of copper (70% of copper metal) was contained in semi-massive sulphides, whereas in this update some 80% of copper metal is contained in semi-massive sulphides.

Resource model reported by ore type

The grade of the semi-massive sulphides is higher than expected at 2.31% copper and 0.80g/t gold. Shoots of semi-massive sulphide are difficult to define in wide spaced drilling and accurate estimates require exposure by underground development and definition by close-spaced (grade control) drilling.

Underground drilling has revised the geological interpretation of the deposit. Previously mineralisation was interpreted as two distinct zones, the Wallaby and Wombat zones. Recent drilling has shown that the Wombat zone contains at least two separate semi-massive sulphide zones. These have been named the Wombat zone and the Gap zone. Figure 3 illustrates relationship of these two zones.

These zones are a result of a fold or thrust that repeats mineralisation. The Gap zone sits in the expected position on a footwall of black schist, however Wombat is offset into the footwall within the host altered ultramafic rocks. There is typically a 5-20 metre gap between the Wombat and the Gap zone. Current drilling shows that these two parallel ‘shoots’ extend from 300 metres deep to the lower limit of drilling at approximately 850 metres depth.

This newly understood structural complexity in the deposit was not predicted and is difficult to resolve with wide spaced drilling. Similar structural complexity was encountered at the lower limit of recent drilling at the base of the deposit. Similar features are also seen in the area where the Wallaby zone ends and the Gap zone begins. A detailed evaluation of the geological and structural model will be completed before determining if drilling at the base of the deposit should commence in the near term or alternatively await the opportunity to drill from deeper mine development.

The wider resource estimate for the Outokumpu area is 17.9 million tonnes at 0.97% copper.

Longitudinal section looking west of the Kylylahti mine showing decline development and drill drive, drilling results intercepts (yellow) and the outline of currently defined reserves. Blue is the upper Wallaby zone which is largely mined out. Red is the Wombat zone. Green is a newly defined zone (Gap zone) in the hanging wall of Wombat zone. See Figure 3 cross section for an illustration of the relative geometry of these zones.

The target zone for further extensions to the Kylylahti deposit is shown in purple. The grid is 100 metres square.

Screen snapshot of a longitudinal section looking west of the Kylylahti mine showing copper grade distribution in the Resource block model. Note the high grades are from 500-600 metres depth (see page 2) Grid is 100 metres square.

Cross-sectional view showing the Gap and the Wombat zones.

Please direct enquiries to:

Alistair Cowden James Harris Jochen Staiger Managing Director Professional Public Relations Swiss Resource Capital AG Altona Mining Limited Perth Tel: +41 71 354 8501 Tel: +61 8 9485 2929 Tel: +61 8 9388 0944 js@resource-capital.ch altona@altonamining.com james.harris@ppr.com.au

About Altona

Altona Mining Limited is a copper producer in Finland and has a major copper development project in Australia.

The Company’s Outokumpu Project in south-east Finland commenced production in early 2012. The project comprises the 600,000 tonnes per annum Kylylahti underground decline mine and the Luikonlahti mill. The annual production rate averages 9,000 tonnes of copper, 9,000 ounces of gold and 1,600 tonnes of zinc with potential to expand production under consideration. Regional resources are hosted in 2 closed mines and 4 unmined resources, all within 30 kilometres of the Luikonlahti mill. Finland is a Eurozone country and has a long history of mining, an attractive corporate tax regime (20%) and no royalties.

Altona’s other core asset is the Roseby Copper Project near Mt Isa in Queensland and is one of Australia’s largest undeveloped copper projects. The first development envisaged is the 7 million tonnes per annum Little Eva open pit copper-gold mine and concentrator. Little Eva’s proposed annual production1 is 38,800 tonnes of copper and 17,000 ounces of gold for a minimum of 11 years. A Definitive Feasibility Study has been completed and the project is fully permitted. Altona is engaged in discussions with potential partners to enable the funding of this major development.

Altona Mining is listed on the Australian Securities Exchange and the Frankfurt Stock Exchange.


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Posted 2014-03-26 13:06:00