Poland

Myszkow Deposit

In March 2009, Strzelecki Metals released its maiden JORC resource statement for the Myszkow Deposit in southern Poland. As estimated by SMG Consultants, the resource is summarized below.

The Myszkow deposit’s 726Mt Inferred Resource has been identified within a presently known envelope of 1.327 billion tonnes of molybdenum-copper-polymetallic mineralisation at 0.096% eMo (molybdenum equivalent) using 0.05% eMo cutoff.

The estimate demonstrates that for 726Mt of the resource, with a cut off 0.085% eMo, the Myszkow deposit contains:

  • 448,000 tonnes (985 million pounds) of Molybdenum (Mo);
  • 878,000 tonnes (1.93 billion pounds) of Copper (Cu);
  • 293,000 tonnes (645 million pounds) of Tungsten (W); and
  • 57,000,000 ounces of Silver (Ag).

Furthermore, a high grade core of the deposit has been identified. This consists of 102Mt grading .17% eMo using a high cut-off grade of .15% eMo.

Location, Past Mining & Geology

The Myszkow project is located in Southern Poland approximately 60km to the North-West of the city Krakow. The topography is described as generally flat open country or farmland. Exploration activities of the Mo-W-Cu deposit are quite close to the southern side of the town of Myszkow. No known past mining has ever been attempted on the Myszkow mineralisation as it is covered with 200 metres of Triassic sediments.

Regional Geology

In southern Poland there are several areas of polymetallic (Cu-Mo-W) mineralisation within a deformation belt of Precambrian to Palaeozoic age. This belt is covered by gently deformed Mesozoic sediments, and its position has been mainly defined by extensive drilling programs that uncovered the presence of altered and mineralised rocks underneath. At Myszkow, this belt forms a 500m wide structural zone that corresponds to the Krakow-Lubliniec Tectonic Zone (TZ). The Krakow-Lubliniec TZ separates two older tectonic blocks (Malopolska and Silesian) and has undergone several periods of reactivation, particularly between Cambrian and Permian. The Krakow-Lubliniec TZ also forms part of a major Precambrian structure, the Krakow-Hamburg Fault Zone (HKFZ), also associated with mineralisation. Regional metamorphism changed the Vendian to Devonian age sediments to phyllites, schists and metapsammites, whereas, contact metamorphism associated with granitoid intrusions produced hornfelses and minor skarns.

Intrusive Events

Towards the end of the Carboniferous crustal granites were intruded along the Krakow-Lubliniec TZ. Mineralisation at Myszkow is associated with the intrusion of one of these granitoids, a 312±17Ma granodiorite porphyry. The regional intrusive event took place as a result of a change in tectonic regime to regional extension during the waning stages of the Variscan Orogeny. All deep holes drilled in the Myszkow area have intersected granitoids, mostly of granodiorite composition and some rare granite.

Chemical Zonation

The Myszkow mineralisation is a Mo-W-Cu porphyry mineralisation system with low concentrations of Au, Hg, As and Sb. Tungsten mineralisation is interpreted to be associated with the early hot stages of mineralisation and, in the core of the system, it appears to be associated with Mo. The system also exhibits NW-SE trending anomalies in Ag, S, Te, and Si that appear to match magnetic and gravity patterns. Other elements displaying anomalous concentrations include Zn, K, Bi, Pb, Sb and Cd. Cu, Pb and Zn anomalies are not symmetrically zoned with respect to the intrusion and appear to be related to contact metasomatic zones.

Drill Hole Data

The initial series of diamond drill holes were drilled with an essentially vertical orientation to depths of up to 1,500m and labelled with a prefix “Pz-”. Twenty-four of these Pz- drill holes are within the Myszkow resource model area. The resource model developed by SMG Consultants is largely derived from core assays of samples obtained from Pz- drill holes.

The drilling at Myszkow intercepted low grade metamorphic rocks of Precambrian (Vendian) to Early Cambrian age that included shales, siltstones, sandstones and greywacke rocks. Younger overlying sediments of Ordovician to Devonian age include carbonates, shales, siltstones, sandstones and conglomerates; and are preserved in grabens controlled by NE trending faults. Permian rocks also appear to be preserved in graben-like structures beneath the flat-lying limestone and dolomite Triassic sediments. The Devonian (312+/-17Ma) granodiorite intrusion associated with mineralisation at Myszkow has been intercepted by all deep holes drilled. In 2008, SKKGM completed the first new diamond drillhole at Myszkow drilled since 1990. Hole MM1 was drilled sub-vertically through the core of the mineralised system with PQ3 core to a depth of 1,200m.

Geological Sections

The figure below shows the orientation of sectional planes used to generate 6 vertical cross-sections of drill hole assays. Each cross-section displays the logged lithology and a line graph representing the assay values.

Past Resource Modeling

Following completion of the initial drilling program by Polish authorities there were several revisions of the resource estimate for Myszkow carried out in Poland to Polish standards and not necessarily in accordance with Australia’s JORC requirements. Those estimates showed variation in response to historical changes in commodities prices, and also the cut-off grade assumed for economic recovery. The Myszkow resource model developed by SMG is based on newly calculated Molybdenum equivalent (eMo) and Copper equivalent (eCu) values derived to accommodate the commodities prices current at the time of printing. It is also carried out to JORC standards.

Estimate of Equivalence Value

Previous resource estimates for Myszkow based on eMo values differ in response to historical changes in commodity prices. Also in the case of Myszkow, the eMo equation combines elements such as Mo and Cu whose spatial distribution appear to be uncoupled within the zone of mineralisation. eMo values were calculated in this study to take into account projected commodity prices from 2009 to 2013. These prices were provided by Strzelecki as the averages of prices projected by a number of financial institutions and are listed below.

eMo Calculations


Resulting eMo Equation:
eMo ppm = Mo ppm + (0.76 x W ppm) + (0.19 x Cu ppm) + (15.00 x Ag ppm)

Metallurgical tests for Mo-Cu-W mineralisation were carried out in 2006 at the Institute of Mining Engineering, Wrocław, and also at the University of Science and Technology, Kraków. The tests were made on samples representing the two main lithological types (schist and granotoid) on the basis of the Mo, Cu or W. A concentrate of 94% Mo and 85% Cu has been obtained from the granite hosted mineralisation. A copper concentrate with the grade 16% Cu at the recovery 76% and a molybdenum concentrate with the grade 48% Mo at the recovery 62% were obtained from sample Pz-29. It is possible to float sulphides of Cu and Mo without a collector in the first stage of ore processing. Such a flotation, for instance in the case of the ore sample Pz-29, secures reporting 40-50% copper minerals and 80-90% tungsten minerals in the concentrate.

Initial flotation tests aimed at recovering the tungsten mineral scheelite, have produced a 41% scheelite concentrate with a grade of 28% W. A tungsten concentrate separated using gravity methods was 13% WO3 and it was obtained at the recovery about 25%. And after further magnetic separation and gravity separation in a heavy liquid had a grade of about 28% W (35% WO3). The experiments proved that the process of ore grinding significantly affects flotation and its results. Although no specific tests were performed on Ag recovery, there is no reason to believe that its recovery would be different that that demonstrated for Mo and Cu.

The metallurgical investigations presented are preliminary. On the basis of the tonnages, grades and recoveries estimated for each of the metals referred to above and included in the eMo calculation, and taking into account prevailing economic conditions and other similar mining operations in the world, it is the opinion of the company (Strzelecki) that there is reasonable potential for each of these metals to be recovered through a mining operation.

Herein, eMo represents the derived “in-ground” equivalent value estimated on the basis of these average commodity prices. As the effect and relative contribution of metallurgical recovery has not been taken into account; further adjustment would need to be considered to estimate the “net” equivalent value of this mineralisation after completion of a feasibility analysis as well as an assessment of the Mo recovery.

3D Block Model and Database

3D block grade modeling involved:

  • Creation of a regular 3D block model
  • Setting up grade interpolation parameters
  • Estimation of block grades from composited drill hole samples
  • Static density value was used through the model
  • Block resource classification

A regular Surpac block model was created to cover the full volume of the study area. Block parameters (origins, extents, sizes and rotation) were determined from the geometry and attitude of the mineralisation, the drill spacing and the grade continuity. The block model was then constrained using the unconformity surface, the -1000m RL and a limiting polygon through the peripheral drill holes. The parent block size was set at 100 x 100 x 20 metres with no sub blocking permitted.

Resource Reporting

Resource reporting involved the following parameters:

  • Density
  • Cut-off
  • Reporting parameters – setup and definitions
  • Classification
  • Resource statements

A standard density of 2.65 was used throughout the model. Cut-off values for reporting the resource were discussed in consultation with geologists from Strzelecki and it was decided to use a cut-off of 850 ppm eMo (0.085%). Resources were reported above a series eMo cut-offs. The cut-offs were set at 850, 1,000 and 1,500 ppm eMo. Resource classification was done into the inferred category only according to the terms and definitions contained in the JORC code. Mineralisation that was estimated below the -1,000 metre RL was not included in the resource as inferred material as this level represents the effective base of sampling. Also, any blocks outside the limiting resource polygon were not assigned a JORC classification. No blocks above the unconformity are JORC classified.

Block Model

(a)

(b)

(c)

(d)

 

Figures (a) to (d) above show the distribution of interpolated grades in model blocks, representing derived eMo grades categorised according to cut off values of .05%, .085%, .10% and .15%. Of note, figure (b) shows the Inferred Resource of 726Mt at .12% eMo, while figure (d) shows the rich core of the deposit consisting of 102Mt at .17%eMo.