Glass Earth Gold believes results from recent exploration around Otago may indicate the presence of two large orebearing structures similar to the Oceana Gold Corp holdings at the Macraes mine in East Otago.
Although Glass Earth is yet to undertake any drill testing in Otago, or release any results, chief executive Simon Henderson confirmed yesterday the company intended to triple its proposed $1 million exploration spending in Otago during the next 12 months.
When interviewed after announcing yesterday that exploration had found two ‘‘new major gold-bearing structures'' similar to Oceana's Macraes structure, Mr Henderson admitted it was a ‘‘bold call''.
‘‘Yes, it's a big call. But we have spent $4 million to date making that call. We have potentially got two Macraes-style shear zones,'' he said.
Oceana's Macraes' tenement has produced more than 57 tonnes of gold, mainly from open-pit mining, during the past 18 years and is estimated to contain a further two million oz or more during its remaining 13-year mine life.
Glass Earth has 20 ‘‘prospects of interest'' in Otago, but has highlighted the historical Serpentine prospect on Rough Ridge, 13km north of Lake Onslow, the Gold and Pine area near Gabriels Gully at Lawrence, and the Game Hen site near historic Hindon workings, as priority targets.
‘‘But whether it's economic [to mine], we now have to prove the hard yards on the ground. That will be no mean feat,'' Mr Henderson said.
Airborne and ground sampling had been undertaken. But Mr Henderson said because of land access issues and delays in laboratory tests, Glass Earth would be ‘‘lucky'' to drill 15-20 holes at potentially five prospects during the year.
‘‘Specialists visiting specific sites have virtually every time found gold. Some are alluvial [river deposits], but some have found features of Macraes-style [underground] shear zones,'' he said.
Recent ground sampling in a 15km by 5km zone had identified indications of gold ‘‘over at least two individual areas'', with strike extents of respectively 3km and 2km, at the Serpentine prospect.
‘‘Drilling of these [two] anomalies is being planned as a priority,'' Mr Henderson said.
In early February, Glass Earth, which had just raised a further $6.3 million for exploration in Canada, said it intended accelerating further geological ground sampling around its Otago tenements.
Three teams had begun ground sampling in November, which would be boosted to four teams and more staff from the North Island once programmes there had finished, Mr Henderson said.
He estimated up to $3 million would be spent in Otago between November and late autumn as 16 staff sampled from up to 20 areas, ranging from Lawrence, west of Dunedin, to the Dunstan Ranges, and around Macraes in East Otago.
Last July, Glass Earth completed a $4 million aerial magnetic and electro-magnetic survey of Otago covering more than 13,000sq km, searching 100m into the crust for minerals, water and other geophysical features.
The Otago Regional Council contributed $1 million.
Mr Henderson said at the time the aerial survey had identified zones similar to the geology of the Macraes open pit and underground gold-mining operations of Oceana Gold.
