STELLAR PACIFIC UPDATE ON JOINT VENTURE IN CHStellar Pacific drinks from ancient bowl of hype
Stellar Pacific Ventures Inc SPX
Shares issued 11,145,427 Jun 21 2004 close $ 0.13
Wednesday June 23 2004 News Release
Mr. Michel Lemay reports
STELLAR PACIFIC UPDATE ON JOINT VENTURE IN CHINA
Stellar Pacific Ventures Inc. has passed another important step in its current development program for its Chinese Sino foreign joint venture.
As previously reported in Stockwatch April 28, 2004, Stellar Pacific Ventures has completed the fourth phase of its Chinese development program.
Following the mutual agreement to form a Sino joint venture with Oxytroling Gold Mines which was signed on April 14, 2004, in Luoning city, the company has completed a report compliant with National Instrument 43-101 on the properties.
The project is located in the east-central part of China on the Asian continent. More precisely it is located in the western region of Henan province and in the central zone of the Luoning county, about 130 kilometres southwest of Luoyang city.
The mining rights cover two distinct areas named the Maying and the Xiquinggangping licences. They are located about 1.6 km apart and cover an area of over 16 square km.
In the past eight years, Chinese geological authorities have carried out extensive exploration in the Maying sector. The Luoning county government has also run small-scale mining and gold metallurgical activities resulting in the identification of a mining area of 16 square km, geographically located at: longitude east 111 degrees 29 minutes, 37 seconds to 111 degrees 31 degrees 30 seconds, latitude north 34 degrees 08 minutes 02 seconds to 34 degrees 11 minutes 56 seconds. The No. 2 Geology Team of the Geology and Mine Bureau of Henan Province has made an optimistic estimation in its report, namely "Prospective Auriferous Ore Reserves in Maying Site," indicating over 20 tons of gold in the above-mentioned location.
The project is positioned in the Qinling region along the southern margin of the North China plate, and is mainly composed of Proterozoic andesite covering an Archean biotite/hornblend/plagioclase gneiss.
At the contact with the andesite and the gneiss, the north part of the Maying area contains 16 known auriferous fracture zones. They are named F1 to F16. F1 is the most important one being present over 3,500 metres. It runs north westerly in the southern part and turns gently to the northeast in the north part. The dip is 45 degrees to the east while other breccias/vein structures are 100 to 600 m and run mostly to the northeast.
The F1 structure is the most mineralized event revealed to date and the gold grade is reported between 1.69 and 6.20 grams per tonne with an average of 4.72 g/t. Extraction work has been done over 800 m in the north part of the F1 structure. The resource estimate is reported in a government official document which contains the following table that assesses auriferous reserve. This result is consistent with other operating mines in this area.
Assessed
auriferous
reserve in
F1 field Avg. Gold
central Reserve Ore grade con-
section grade (ton) (g/t) tent
(kg)
Known
reserve C+D 236,270 5.76 1,362
Used
reserve C+D 63,534 4.91 312
C 51,530 5.92 305
D 121,206 6.15 745
Inventory
reserve C+D 172,736 6.08 1,050
On the Xiquinggangping block 2, vein structures have been worked and they both run westerly with a moderate dip to the north. They represent conjugate fractures related to the regional northeast trending fault structure that hold the Shangguan and the Ganshu mines directly adjacent to the northeast. The F1 vein is 300 m long and contains gold values of 2.33 g/t over 1.14 m to 5.66 g/t over 1.75 m. The F2 vein is 250 m long and contains gold value of 4.54 g/t over 1.53 m to 5.63 g/t over 1.67 m.
The Chinese government estimates that the total potential reserves can reach over 600 million tonnes or 20 million ounces in the region. This estimate is based on mainly surface and near surface work done over the past 50 years. It is important to note that, no work has been done at depths greater than 100 metres below surface. Current exploration and recovery technologies can improve the probability of finding additional gold resources and it is very likely that Sanmenxia's Xin'an county and Luoning county may uncover a rich deposit of 10 million ounces.
On April 15, 2004, three representative geological samples were taken from the stockpile adjacent to the mill. The result shows a high content in silicium indicating a dacite to rhyolite composition (probable belonging to the Jidanping formation) and a tholeiitic affinity and good correlation between Au, Ag, As. Ba, Be, Cd, P, Pb and Zn. These samples indicate a gold grade from 1.22 to 18.20 g/t in accordance to the Maying mine evaluation as well as others in the region and an unexpected value over 1 per cent Zn in sample SM04R03.
These properties are located within a known gold belt that has been assessed and identified by the Chinese government's geological staff. The technical evaluation report which was just completed supports and recommends an extensive exploration program to further define and identify all gold-bearing structures in the project area.
When the above data are considered with the fact that no exploration or development work has been done below 100 m, we consider that this project, as with others projects in this gold belt, is practical at is initial phase and there exists a good probability of finding an economical gold orebody. Stellar Pacific Ventures is very pleased with this milestone achievement which will position the company closer toward the realization of its objectives.