Xanadu sets sights on Mongolian copper-gold at Red Mountain

Xanadu Mines has kicked off a 5000m diamond drill campaign at its Red Mountain project in Mongolia with a focus on the discovery of shallow high-grade gold, porphyry copper-gold and copper sulphide lodes.

The operation’s Target 33 prospect has been highlighted as a priority after previous drilling returned impressive results with a 40m section grading 1.06 grams per tonne gold from 26m including a 10m section at 3.7g/t from 50m.

Five shallow diamond drill holes will be sunk at the site to test a 300m strike at the centre of the identified gold anomaly where prior trenching revealed a 4m hit going 2.82g/t gold from surface.

Three shallow drill holes and one deeper probe will explore Xanadu’s Target 10 prospect at Red Mountain to test for high-grade copper and porphyry copper-gold targets. The company previously drilled a magnetic feature at the site with assays returning 6.2m grading 4.24 per cent copper and 1.9g/t gold from 128m including 0.9m at a whopping 22.1 per cent copper and 8.27g/t gold from 129m.

A deeper intercept from the same hole delivered 79.5m going 0.26 per cent copper and 0.21g/t gold from 198.5m, while a second deep diamond hole returned 138m at 0.27 per cent copper and 0.25g/t gold from 200m.

The 5000m exploration program will also test shallow copper-gold porphyry targets at Red Mountain’s Nowie, Stockwork and Bavuu prospects.

Trenching at Bavuu back in 2016 revealed wide porphyry hits highlighted by 188m grading 0.24 per cent copper and 0.18g/t gold including 52m going 0.36 per cent copper and 0.22g/t gold.

Management believes Red Mountain shares geological similarities with Evolution Mining’s Northparkes copper-gold porphyry deposits in New South Wales which, in 2022, held an estimated mineral resource of 526.9 million tonnes at 0.55 per cent copper, 0.19g/t gold and 1.87g/t silver.

Red Mountain offers a rare opportunity to access a large, under-explored mineral district. We are conducting a systematic exploration program, including diamond drilling, that we expect will provide a new perspective on the mineral potential of the Red Mountain district.

Red Mountain sits to the east of Xanadu’s flagship Kharmagtai project that hosts a massive mineral resource of 1.3 billion tonnes at 0.3 per cent copper and 0.2g/t gold for 3.4 million tonnes of contained copper and 8.5 million gold ounces. The total resource includes 52 million tonnes of oxide material primarily in the top 20m from the surface.

Last year, the company completed two phases of its strategic partnership with China’s giant Zinjin Mining Group, providing access to funding for its ongoing exploration blitz. The deal saw Zijin invest US$35 million (AU$52 million), which will also be used to complete the Kharmagtai preliminary feasibility study (PFS).

A 50:50 joint venture (JV) has been created between the two partners at a project level, with Xanadu the operator on the ground. The partnership has allocated 18 months to knock over the PFS for Kharmagtai, which is expected to be completed this year.

Management expects its Red Mountain exploration campaign to be complete by mid-May with first assay results due before the end of next month. Xanadu already has a 30-year mining licence granted for the 57-square kilometre operation.

Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au