The Conrad silver mine is situated about 20 km south of the town of Inverell, in northern NSW, where Malachite's tenements cover approximately 170km² and are held 100% by the Company (Figure 1).
Key features of the Conrad project are:
Mineralisation at Conrad may be described generally as of fissure vein style, consisting of massive to semi-massive and veinlet sulphide minerals, with variable amounts of galena, sphalerite, chalcopyrite, cassiterite, stannite, pyrite and arsenopyrite. Silver minerals identified include tetrahedrite, argentite, acanthite, pyrargyrite and native silver. The sulphide minerals are concentrated along well defined structures that cut across the Gilgai Granite from the northwest and, in some cases, extend southeast into the Tingha Granite (Figures 1 and 2). Disseminated and veinlet sulphide mineralisation, hosted by greisen, also occurs in a discrete body averaging 30m in width.
Historical workings were developed mainly on the Conrad lode, which was accessed through the Conrad, King Conrad, Moore and Davis shafts. Some ore also came from the King Conrad and Alwell’s lodes. The first production period extended from 1898 to 1912, when the mine closed due to industrial relations problems. It was then largely inactive until 1948, when Broken Hill South Ltd. commenced underground development. The mine resumed production from 1955 to 1957, but then closed due to falling lead prices; it has been idle ever since.
A composite longitudinal section of the Conrad lode system is presented in Figure 3 and shows the shaft locations in relation to the main stopes mined in the first and second periods of operation. Malachite first drilled at Conrad in 2003, when it tested at depth beneath the Conrad and Davis shafts (Figure 4). Continuity of the lode at depth and along strike to the southeast was confirmed, with several parallel splits of the lode intersected near Davis shaft. The best result recorded at that time was 4.1m (true width) @ 98g/t Ag, 0.58% Cu and 0.55% Sn, or 330g/t AgEQ in silver equivalent terms.
Drilling by Malachite resumed in 2006 and was focussed mainly on targets near the King Conrad shaft, at the northwest end of the mine area (Figure 4). This drilling was highly successful, intersecting multiple lode packages over true widths of up to 5m. Typically, these lodes contain a high to very high grade, polymetallic massive sulphide central core, 0.3 to 1m wide, with silver grades of 300 to 1,850g/t Ag. An envelope of stringer and veinlet sulphide mineralisation generally occurs on each side, offering potential average mining widths of the order of 2 to 3m. Both core and envelope zones include significant copper, lead, zinc and tin credits, giving silver equivalent grades of up to 5,000g/t AgEQ in the cores and approximately 200-300g/t AgEQ over the full lode package width. The best drill hole intersection at Conrad to date is 1.17m @ 1,715g/t Ag, 3.9% Cu, 16.1% Pb, 5.0% Zn, 3.4% Sn and 79g/t In. Such mineralisation has an in-ground contained metal value (at March, 2008 metal prices) of approximately $US2,800 per tonne.
A second style of silver mineralisation was discovered in the 2006 drilling near King Conrad, comprising a broad greisen zone with disseminated and veinlet sulphide mineralisation that represents a bulk-tonnage style of mineralisation. This zone is of the order of 30m wide, with silver grades around 30g/t Ag and silver equivalent grades of around 100g/t AgEQ. Importantly, the silver in the greisen zone seems to be all or largely native silver, implying that recovery of silver by gravity concentration or heap leaching may be feasible.
The rare and highly valuable metal, indium, is present in significant amounts at King Conrad, with values up to 136g/t In. Given that indium is currently worth significantly more than silver (i.e. around $US750/kg In), this metal has the potential to add important extra value to the project. A strong correlation between zinc and indium at Conrad (correlation coefficient of 0.9) indicates that indium is likely to report to a zinc concentrate.
In 2007 Malachite conducted a 6,000m drilling program in the King Conrad part of the Conrad mine area, with the aim of delineating an initial mineral resource. That work was successful and a further 10,000m of drilling began in early 2008. Once the new drilling is completed it is likely that sufficient resources will have been delineated to allow the project to move on the pre-feasibility and pre-development studies. This would involve de-watering the mine and converting mineral resources to mining reserves utilizing underground diamond drilling.
The results of drilling to date at Conrad are very encouraging and strongly support the Company’s view that the Conrad mine will see a third incarnation as a modern, underground mining operation producing a mix of metals. For further details of 2007 drilling results and updates on continuing exploration and evaluation of the Conrad project please go to ASX Announcements.
More photos from the Conrad Project can be found in the Photo Gallery.
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