Quarterly Report
Tertiary Minerals PLC
02 August 2004
www.tertiaryminerals.com
2 August 2004
QUARTERLY REPORT ON
EXPLORATION ACTIVITIES
FOR THE PERIOD ENDED 30 JUNE 2004
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HIGHLIGHTS
•Winter/Spring Drilling Programmes :
•Confirm Presence Of Significant Copper-Gold System At Ahmavuoma
•Intersect High-Grade Gold Mineralisation At Kaaresselka
•Discover New Kimberlite On Finnish Diamond Project
•Tantalum Demand And Prices Rebound.
•Drilling Started at Djuragruvan Zinc-Silver Project, Imminent On Second
Diamond Target
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INTRODUCTION
This report gives details and results of exploration work carried out during the
Quarter ended
30 June 2004 and up to the date of this report.
GOLD & BASE METAL PROJECTS
Ahmavuoma Copper-Gold-Cobalt Project
Sweden - Tertiary Minerals plc 100%
On June 1 the Company reported that its winter/spring 2004 drilling programme at
Ahmavuoma project in the Norbotten district of Northern Sweden had confirmed the
existence of a significant IOCG (iron-oxide copper gold) mineralised system.
IOCG style mineralisation encompasses some of the largest copper deposits in the
world.
In the Discovery Zone the best results include 5m, grading 1.37% copper and 0.3g
/t gold in hole 04AH003 and 18.05m grading 0.4% cobalt and 0.15% copper in hole
04AH001. Both of these intersections occur in a broader zone of lower grade
copper mineralisation with a width between 33-68m and grading between 0.25-0.40%
copper.
The winter drilling programme was originally designed to include 7-10 diamond
drill holes to test electrical conductors and for mineralisation in the
Discovery, Central and Northwest Zones (see release 29/1/04). However, due to
the slow drill penetration rates (necessary for good core recovery), only 5
holes could be completed before the spring thaw as access depends on a good snow
and ice layer for drill rig movement across marshy ground.
All significant assay results are shown in the accompanying table.
Discovery Zone
Three drill holes 04AH001-3 were completed at 50m intervals along the strike of
the Discovery Zone from south to north. The results are shown in the table
below. Hole 04AH001 was drilled in the centre of a weak electrical conductor
whilst the most northerly hole 04AH003 was drilled on its extreme north end.
Hole 04AH001 intersected a 57m thick zone of sulphide mineralisation dominated
by the iron sulphide mineral pyrite, with an 18m thick zone of semi-massive
pyrite at its centre containing high levels (9 lbs per tonne) of cobalt.
Hole 04AH002 encountered a similar thickness of sulphide mineralisation with a
lower percentage of iron sulphides but similar copper levels to 04AH001.
Hole 04AH003 intersected lower levels again of iron sulphide mineralisation,
consistent with the end of the electrical anomaly, but significantly, this hole
contained a higher percentage of copper sulphide minerals and, correspondingly,
the highest copper grades.
The results of the drilling on the Discovery Zone indicate that :
•the intensity of copper mineralisation is not directly related to the
electromagnetic anomaly and is more widespread;
•the weak electromagnetic anomaly defines a zone of massive iron-sulphide
mineralisation of limited strike length containing high levels of cobalt;
and
•copper mineralisation remains open in all directions.
Core logging indicates that the copper mineralisation in the Discovery zone has
features consistent with the IOCG style of mineralisation. In IOCG deposits it
is commonly the case that the highest copper grades are not always directly
associated with the highest concentrations of sulphide minerals.
Central Zone.
The Central Zone is a 1km long coincident magnetic and electromagnetic anomaly
and was tested by hole 04AH004 at its southern end, where base-of-till samples
were anomalous in copper.
This 192m long drill hole intersected altered and pervasively fractured volcanic
rocks with abundant magnetite (an iron-oxide mineral) veining and magnetite
breccias throughout. Massive magnetite occurs in two intervals: a 2m wide
section between 46 - 48m and a second, 7m wide section between 106 - 113m.
Magnetite can be electrically conductive in certain circumstances and it is
considered that the target electrical conductor is explained by the massive
magnetite. Only limited sulphide mineralisation is present in this hole and no
significant assays were returned.
Weather constraints did not permit the drilling of the second planned hole in
the Central Zone to test a possible demagnetised zone further to the north along
the axis of the electrical conductor where magnetite may have been replaced by
more prospective sulphide mineralisation.
Northwest Zone
The Northwest Zone comprises a 2 km long electrical conductor with a weak
magnetic signature.
Hole 04AH005 was drilled to test the conductor at its southern end in a zone of
possible enhanced dilation prospective for sulphide mineralisation. The hole
intersected a broad zone of IOCG style rock alteration but nothing that would
explain the electrical conductor. A follow up down-hole electromagnetic survey
suggests that the target conductor was not tested by the hole and lies some 10's
of metres below the drill string and could be tested by a new hole wedged off
the existing drill hole.
A second hole, which planned to test the Northwest Zone further to the north at
its point of maximum conductance, was not drilled due to the weather constraints
and will now be included in a further programme of drilling to be carried out
next winter.
DISCOVERY ZONE DRILL INTERSECTIONS
MAY 2004
Down Hole
From To Intersection Cu Co Au
m m m % % g/t
Hole 04AD001 32.95 89.90 56.95 0.26 0.19 0.07
Inc. 33.75 43.50 9.75 0.50 0.09 0.06
and 46.75 55.00 8.25 0.43 0.13 0.09
and 56.80 74.85 18.05 0.15 0.40 0.08
and 82.15 89.90 7.75 0.34 0.12 0.05
End of Hole 162.6
Hole 04AD002 47.40 115.60 68.20 0.25 0.02 0.06
Inc. 50.40 71.65 21.25 0.50 0.03 0.18
Inc. 54.25 54.90 0.65 2.00 0.07 0.35
58.95 59.70 0.75 1.03 0.13 0.09
65.30 65.70 0.40 1.44 0.01 2.88
End of Hole 166.3
Hole 04AD003 32.35 65.35 33.00 0.40 0.02 0.09
35.75 36.35 0.6 1.16 0.00 0.01
44.65 49.75 5.10 1.37 0.06 0.30
63.15 65.35 2.2 0.77 0.00 0.28
75.15 75.7 0.55 1.53 0.01 0.38
115.7 117.35 1.65 0.87 0.00 0.34
End of Hole 143.15
KaaresselkTM Gold Project
Finland - Tertiary Minerals 100%
On 17 June 2004, the Company released the final results from its first drilling
programme at the KaaresselkTM gold project in Finland. Results from the first
three holes were reported in the last quarterly report, on 6 April, whilst on 17
June 2004 the results from a further 7 holes were released and included a number
of high-grade gold intersections.
This first drilling programme was designed to evaluate the controls and
distribution of gold mineralisation in the three target zones further details of
which can be found at http://www.tertiaryminerals.com/projects-europe.htm#
KARRESSELKA
Significant assay results are given in the accompanying table and include some
of the best results from KaarasselkTM to-date. A plan illustrating the location
of the drill holes is also available on the Company's website.
Hole 04KD005 is located in the SE extension of the Tienvarsi zone and
intersected
2.75m grading 13.5 grammes/tonne (g/t) gold from 15.45m depth demonstrating that
mineralisation is open in this direction.
Hole 04KD007B, located towards the western end of the Vanha zone, intersected
4.90m thickness grading 11.0 g/t gold from 74.80m down-hole and was drilled to
test at depth the gold mineralisation intersected by GTK drill holes RC5 (3m
grading 7.2g/t gold) and R436 (1.4m grading 22 g/t gold) towards the western end
of the Vanha zone. This result is important as it suggests the potential for a
high-grade depth extension to the near surface mineralisation at this location.
Hole 04KD009 and 010 were drilled across the Lampi zone. Previous drilling by
GTK had returned a best result of 11.55m grading 1.32 g/t gold from 24.50m, but
failed to explain a strong geochemical anomaly. Drilling in a different
direction, to test an alternative interpretation of the strike direction of
mineralisation, was rewarded with an intersection in hole 04KD010 of 10.3m
grading 3.88 g/t gold from bedrock surface at a depth of 3.9m beneath the
glacial till. (This intersection comprises three composite samples with
individual samples now being re-analysed). The geometry of this zone, which is
not yet understood, can be investigated by trenching.
Hole 04KD004 is located 100m along strike from previously reported hole 04KD002
and the NW end of the Tienvarsi zone. A narrow, low-grade intersection was
returned (see table below) indicating that gold mineralisation, albeit weak, is
open in this direction.
The results from the Company's first drilling programme at Kaaresselka are
considered to be highly encouraging as they confirm that gold mineralisation is
spread over a wide area, with a number of high-grade intersections having been
returned both from surface in the weathered zone and in the fresh rock. The
results have also significantly upgraded the Lampi zone as a target for further
drilling.
The Company has now carried out further core sampling and a detailed location
survey for all drill holes. This will enable the planning of follow up drilling
programmes aimed at resource delineation.
DRILLING KAARESELKA Winter/Spring
RESULTS 2004
From Drill Hole Gold Grade
Hole Number (down hole Intersection (grammes per
depth) tonne
(down hole width) -g/t - gold)
TIENVARSI ZONE
04KD004 56.05m 1.00m 1.00 g/t Au
04KD005 15.45m 2.75m 13.46 g/t Au
Including 16.10m 1.10m 29.20 g/t Au
VANHA ZONE
04KD007B 69.40m 1.00m 2.64 g/t Au
And 74.80m 4.90m 11.02 g/t Au
Including 74.80m 1.10m 39.30 g/t Au
And 94.20m 0.30m 1.07 g/t Au
LAMPI ZONE
04KD010 3.90m 10.30m 3.88 g/t Au
And 74.00m 0.70m 3.62 g/t Au
A further claim application has been made for an area some 20km west of
Kaaresselka where previous drilling by Outokumpu on the Kiekeromaa project
reportedly intersected gold values up to 13 g/t (over an unreported width).
Vehkavarra Copper-Gold Project
Sweden - Tertiary Minerals 100%
Vehkavaara, a target for IOCG copper-gold mineralisation, is situated in the
Norbotten mining district some 70km south of Ahmavuoma.
Fifty base-of till/bedrock percussion drill holes were completed during the
quarter, on two traverses, to follow up surface copper geochemical anomalies in
an area considered prospective for IOCG deposits. A base-of-till geochemical
anomaly was defined and will be investigated by trenching this summer.
Djuragruvan Zinc-Silver Project
Sweden - Tertiary Minerals 100%
The Company has recently started a drilling programme to test for zinc-silver
mineralisation at its Djuragruvan project in the Bergslagen disctrict of
south-central Sweden
Drilling will target the historic Gruvberget mining centre where, in 1989, a
small, privately-managed mining campaign produced 40,000t of custom-milling ore
grading 7% zinc-lead and 90g/t silver from a 30m deep open-pit.
Prior to its acquisition by Tertiary Minerals, the Gruvberget mining centre had
been privately owned for over 100 years and consequently it has not seen any
modern exploration or deep drilling. A review of 1989 production-drilling data
and geophysical work carried out by Tertiary suggests that the mineralisation is
open at depth below the open-pit and also along strike.
Drilling commenced in the last week of July. Three or four diamond holes are
planned as an initial test of the target and results are expected in September.
FINNISH DIAMOND PROJECT
Tertiary Minerals 100%
On 15 July 2004 the Company was very pleased to have announced the intersection
of two separate kimberlitic bodies in the first drill hole of its diamond
exploration project in the Karelian Craton of Finland.
The objective of drilling was to test a ground magnetic anomaly that, based on
previous exploration reports, was believed to reflect a small kimberlite pipe or
dyke. The hole confirmed the presence of massive hypabyssal kimberlite (Group I
geological characteristics) from 71.55m to 98.43m down hole. Unexpectedly, the
hole also intersected a second kimberlite (Group II geological characteristics)
between 51.35m to 59.85m down-hole.
The second kimberlite differs from the first in that it is micaceous, contains
visible kimberlite indicator minerals, is only slightly more magnetic than its
host rocks and may be significantly older than the massive kimberlite. This
kimberlite was not known from previous exploration.
A second larger diameter hole was drilled adjacent to the first hole for
sampling purposes and made a second intersection of the Group II kimberlite from
46.41 m to 48.75 m where the hole reached the technical limit of the small drill
rig used. Samples of both kimberlites have now been sent to independent diamond
laboratories for an evaluation of microdiamond/indicator mineral content and
chemistry.
Kimberlites usually occur in clusters and so the occurrence of two types of
kimberlite, possibly of two distinct generations, is seen as particularly
encouraging for the wider distribution of kimberlite in this under-explored part
of the Finland. In order to take advantage of its recent discovery the Company
has applied for further claims and claim reservations in the area and as a
result now has a total of 21 targets under its control. All lie within the
Karelian Craton, a block of ancient crustal rocks that exhibits all the
characteristics necessary to host and preserve diamondiferous kimberlites. This
craton extends across the BORDER='0' into Russia where it hosts the world-class
Arkhangelsk diamond deposits (www.gsf.fi/explor/eco_diamond_frame.htm).
At the first of these new targets, some 20km away, work has already begun. A
ground magnetic survey that has successfully defined the surface position of a
kimberlite target that will be drill tested in mid-August.
Technical Note : In this report the term 'kimberlite' is used sensu lato to
denote a rock of kimberlitic affinity which has potential to host diamonds.
Further mineralogical work, including microprobe studies will be required to
determine the exact classification of the rocks. Not all kimberlites contain
diamonds.
TANTALUM PROJECTS
Whilst no work was carried out on the company's Rosendal (Finland) or Ghurayyah
(Saudi Arabia) tantalum projects during the quarter the company is very
encouraged by the recent strengthening of the tantalum market.
Recent reports suggest that the tantalum market has rebounded with prices having
recovered after the collapse of the high tech bubble to levels of c. US$40 per
lb from a low of below $20 per pound in 2002 in the wake of the high-tech bubble
collapse.
It is also reported that demand for tantalum has recovered to within 5% of the
2000 peak levels and is now 85% above the 2002 lows.
Patrick Cheetham
Executive Chairman
Further Information: Patrick Cheetham, Executive Chairman,
Tertiary Minerals plc. Tel: 01625-626203
Ron Marshman/John Greenhalgh, City of London PR Limited.
Tel: 020-7628-5518
Maps illustrating some of the features referred to in this report can be found
on the Company's website www.tertiaryminerals.com
This information is provided by RNS
The company news service from the London Stock Exchange