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AEX Gold Inc
Symbol AEX
Shares Issued 177,098,737
Close 2022-04-04 C$ 0.59
Market Cap C$ 104,488,255
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AEX Gold drills 0.5 m of 61.43 g/t Au at Nalunaq

2022-04-04 09:07 ET - News Release

Mr. Eldur Olafsson reports

AEX 2021 DRILLING RESULTS AT NALUNAQ CONFIRM FURTHER HIGH GRADE INTERSECTIONS

AEX Gold Inc. has released the results of its 2021 exploration drilling campaign at the Nalunaq project in south Greenland. The Nalunaq project is a past-producing underground mine which produced approximately 360,000 ounces of gold between 2004 and 2013 from three high-grade zones.

The 2021 drill program comprised 51 drill holes, primarily targeting the newly defined Valley block predicted by AEX's dolerite dike structural model.

Highlights

  • Drilling has intersected the Main vein structure in 33 drill holes, 27 of which intersected gold, which is better than originally expected given the heterogeneous distribution of the deposit and, significantly, confirms the presence of a fourth high-grade zone at Nalunaq.
  • A particular highlight was hole AEX21044 -- 0.50 metre at 139 grams per tonne gold and 30.4 g/t gold for a weighted average of 61.43 g/t gold.
  • Results verify that the Valley block, unrecognized by previous operators, is a new high-grade zone, with multiple visible gold intersections confirming the presence of free gold, and can now be the focus for initial resource growth at Nalunaq.
  • Results confirm that AEX has fulfilled all of its 2021 exploration objectives at Nalunaq.
  • Assay results also support AEX's dolerite dike model, which has been used to predict the location and extents of five new high-grade zones which the corporation aims to target for progressive resource growth.
  • Independent studies have confirmed that historical surface drilling within high-grade zones at Nalunaq can underrepresent the in situ resource, due to the nugget effect in drill core. Therefore, AEX considers that any mineralized intersection from drill holes within high-grade zones will form part of a higher-grade population.
  • AEX is reviewing these results and, in conjunction with SRK Consulting, is developing a new mineral resource estimation procedure that incorporates the new dolerite dike model and accounts for the nugget effect in drill core, in order to better reflect the resource potential of the Valley block and the rest of the Nalunaq project.

Eldur Olafsson, chief executive officer of AEX, commented: "I am delighted to announce the 2021 drill results from Nalunaq which has fulfilled all our objectives. Our success rate in intersecting the Main vein continues to increase and this season has been the most successful to date, where we have confirmed the existence of an entirely new high-grade zone. The Valley block area holds the potential to materially increase the resources at Nalunaq and the confirmation of the company's dolerite dike model opens up the prospect of further resource discovery across five high-grade zones. We plan to build on these encouraging results in our 2022 field program and our mineral resource estimation work with SRK. We look forward to delivering our regional exploration results from 2021 over the next few months and providing the market with our work plan for 2022."

Discussion on results

The Main vein is a laterally extensive shallowly dipping auriferous quartz vein averaging around 70 centimetres thick and hosting variable high grades of up to 5,240 g/t Au. The mineralization is separated into high- and low-grade zones, and is controlled by the intersection of structures which AEX has defined in its geological model.

This vein was mined between 2004 and 2013, and produced approximately 360,000 ounces of gold. AEX is exploring for a target of up to two million ounces gold across the Main vein, in addition to the footwall and hanging wall vein potential announced in Sept. 16, 2020. The current inferred mineral resource stands at 251,000 ounces of gold in 422,770 tonnes at a grade of 18.5 g/t.

The reported 51 drill holes (10,928.14 metres of total drilling, or 11,044.1 metres including one abandoned hole) follow the previously reported intersections from the 2020 drill program reported November, 2020. The 2021 program was designed to assess the along-strike and down-dip extensions of the mineralized Main vein structure away from the previously explored South, Target and Mountain blocks mined between 2004 to 2013.

The program was also designed to assess AEX's geological and structural models, and to test new areas of the project, and as such not all drill holes were intended to intersect the Main vein.

The key focus of the program was the development of the Valley block, a new parallel resource area predicted by AEX's new structural model, the dolerite dike model. The results announced herein provide further evidence that the Valley block is a new high-grade zone, unrecognized or developed by previous operators, and corroborate the dolerite dike model. Along this high-grade trend, highlights include:

  • The intersection of five visible gold intervals confirming the existence of free gold;
  • AEX21044, which intersected 0.5 m at 61.43 g/t Au (a weighted average from two Main vein samples at 139 g/t Au and 30.40 g/t Au);
  • Hole AEX21007, which intersected 0.54 m at 38.83 g/t Au (a weighted average from two Main vein samples at 39.7 g/t Au and 17.50 g/t Au).

Both of these holes build on the up-dip potential identified in 2020 within hole AEX2008 (0.55 m at 52.36 g/t Au). This block now exists as a target for initial resource growth. These surface drill hole intersection grades at Valley block are considered comparable with those historically encountered across the other three mined blocks.

AEX's dolerite dike model uses structural intersections to predict a series of prospective domains for high-grade mineralization. The confirmation of the effectiveness of this model now provides the corporation with up to five high-grade zone targets for progressive resource growth. These prospective domains are now being used to better focus AEX's drilling activities.

Due to the high nugget effect experienced at Nalunaq (where mineralization is often concentrated into large nuggets), historical surface core drilling results have underrepresented the in situ mineralization. This has been confirmed by an independent review conducted by SRK Consulting which suggested that surface core drilling alone typically underreports gold grade and resource potential in high-grade zones. From this review and incorporating the dolerite dike model, AEX believes that any mineralized intersection from drill core within a predicted high-grade zone can be considered part of a wider higher-grade population. This has an implication on how future resource estimates could be conducted, and could allow for potential increases in resource size and classification.

The high variability of gold grades in deposits with a high nugget effect such as Nalunaq makes accurate estimation of grade challenging. Therefore, in parallel with the drilling program, AEX has been working alongside SRK to assess new mineral resource estimation procedures the incorporate the dolerite dike model and the nugget effect from core to better reflect the full resource potential at the Valley block and the rest of the Nalunaq project. AEX believe that these new approaches will allow for an increase in resources and provides the corporation with a robust procedure to estimate in situ mineralization through surface drilling without the need for close-space underground sampling. The issue of requiring close-space sampling was highlighted in AEX's press release of November, 2020, and may be resolved through this new estimation procedure.

Further, and to lessen the influence of this nugget effect during mineral resource estimation, AEX, in consultation with SRK, elected that during the 2021 drilling program an additional quarter core sample from each Main vein intersection would be collected and combined with the original half core as a weighted average. Increasing the overall size of assayed samples is a common approach employed to reduce close spaced variability.

It is the company's intention that this new resource area, the Valley block, will become the focus of the initial mining on the asset and will provide feed to the process plant. Further exploration and development in other areas of the historical mine and extensions of the deposit will progress concurrently.

New discoveries

The 2021 program also targeted a down-dip extension of the South block and identified a potential further high-grade zone (which would take the total to five), which was predicted by the dolerite dike model. Highlights here include:

  • Hole AEX21021, which intersected 0.49 m at 12.02 g/t Au (a weighted average from two Main vein samples at 16.95 g/t Au and 1.56 g/t Au), which provides evidence that the high-grade mineralization extends down dip away from the previously mined areas at the South block;
  • Hole AEX21024, which intersected 0.50 m of Main vein at 1.63 g/t Au (a weighted average from two Main vein samples at 1.58 g/t Au and 1.75 g/t Au), which provides a positive indication that a further resource area may be located to the south of the Valley block.

It is AEX's intention to continue to explore these resource growth areas.

Sampling and quality assurance/quality control disclosure

Drill core was cut in half using a diamond blade core saw. Where a bottom-of-hole orientation line was present, the cut line was marked approximately five degrees off axis, and the left-hand side of the core was sampled. Bulk density measurements were taken of all Main vein samples. All drill core samples were placed into thick polymer bags with a sample ticket. Each sample bag was sealed and transported from site to ALS Geochemistry, Loughrea, Ireland, an accredited laboratory for analysis.

Sample preparation scheme PREP-31BY was used on all samples. This involves crushing to 70 per cent under two millimetres, rotary split off one kilogram, and pulverizing the split to better than 85 per cent passing 75 microns. Samples were then analyzed by 50-gram fire assay with Au-AA26, which has a detection limit of 0.01 part per million Au. Samples containing visible gold and samples considered to be the Main vein were assayed with screen-metallics fire assay technique Au-SCR24, which has a detection limit of 0.05 ppm Au. This involves screening one kg of pulverized sample to 106 microns, followed by a gravimetric assay of the entire plus fraction and a duplicate 50-gram AAS (atomic absorption spectrometry) assay of the minus fraction. In addition, all samples were assayed with a 48-element four-acid digestion ICP-MS (inductively coupled plasma mass spectrometry) technique (ME-MS61).

The QA/QC program of AEX consists of the systematic insertion of certified standards of known gold content, blanks and quarter core field duplicates at a rate of one in 20 or 5 per cent per QA/QC type. Quarter-core field duplicates were also made of all Main vein intersections and separated in sequence from their equivalent half-core samples by a coarse blank to avoid contamination. In addition, ALS insert blanks and standards into the analytical process. The average sample mass was 2.08 kg.

Mineral resource standard

All mineral resources estimated presented in this press release have been estimated in accordance to the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) definition standards on mineral resources and mineral reserves, National Instrument 43-101.

Qualified person statement

The technical information presented in this press release has been approved by James Gilbertson, CGeol, vice-president of exploration for AEX Gold and a chartered geologist with the Geological Society of London, and as such a qualified person as defined by National Instrument 43-101.

About AEX Gold Inc.

AEX's principal business objectives are the identification, acquisition, exploration and development of gold and strategic metal properties in Greenland. The corporation's principal asset is a 100-per-cent interest in the Nalunaq project, an advanced exploration-stage property with an exploitation licence including the previously operating Nalunaq gold mine. The corporation has a portfolio of gold and strategic metal assets covering 4,090 square kilometres, the largest mineral portfolio in southern Greenland covering the two known gold belts in the region. AEX is incorporated under the Canada Business Corporations Act and wholly owns Nalunaq A/S, incorporated under the Greenland Public Companies Act.

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