IGR 0.00% 50.0¢ integra mining limited

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    Thursday, 21 February 2008

    RESOURCESTOCKS:

    Salt Creek discovery adds flavour
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    Tuesday, 13 November 2007

    EARLIER this year Integra Mining made the announcement every junior gold explorer in the country has desperately wanted to make. By Wally Graham - RESOURCESTOCKS*

    The grassroots discovery of significant gold mineralisation at the Salt Creek prospect within its 100%-owned Randalls Project, located 60km east of Kalgoorlie, has seen Integra Mining quickly make the transition from a company that was exploring for additional resources to justify development to now being a company that has to decide on its scale of development as it moves towards production.

    "Our focus over the past 12 months has been trying to identify additional higher grade resources in the Randalls area," Integra managing director Chris Cairns told .

    "We've been very successful with the discovery of Salt Creek and notwithstanding that we've also had considerable success around some of our known deposits in Maxwells and Cock-eyed Bob, so we have generated a very strong string of results over the past six to 12 months in those areas as well.

    "Understandably, that has been overshadowed by the Salt Creek discovery but the whole context of all of that work is that we are on the cusp of being able to move forward to production on a very robust basis."

    Preliminary results of a pre-feasibility study carried out on the Randalls Project last year included openpit optimised/designed in-pit resources of 5.4 million tonnes at 2.6 grams per tonne gold (mining diluted) for 410,000 ounces of gold recovered. Upon completion the study indicated a four-year mine life producing up to 115,000oz of gold per annum encouraging Integra to explore for a fifth year of production with a target of an additional 100,000oz of openpit resources.

    Drilling being carried out at Salt Creek continues to return high-grade gold results with some of the more recent including: 36m @ 3.33gpt gold including 11m @ 5.26gpt gold; 23m @ 4.62gpt gold including 4m @ 15.04gpt gold; and 40m @ 4.85gpt gold including 8m @ 14.47gpt gold.

    Integra has previously employed a sampling methodology, which resulted in assay turnaround times of up to 10 weeks from completion of each hole. For the Salt Creek samples the procedure has been modified so that 1m samples are sent directly to the assay laboratory for fire assay and this, in conjunction with other initiatives implemented by the laboratory, is expected to reduce the assay return time to just two to three weeks.

    "We have implemented a strategy to accelerate the return of those assays as we do lament the slow turnaround that we have experienced, but that is an industry phenomena," Cairns said.

    "What we've decided to do is release drill results on a section by section basis because that gives investors the best context from which to interpret the results.

    "As we can now put our results out section by section the other thing that we have been able to tell the market, in this context, is that the recent [reverse circulation] drilling has also resolved some of the issues relating to the orientation and geometry of the gold mineralised zones that we had."

    Recent drilling indicates that previously reported mineralised intervals at Salt Creek do approximate true width. The orientations are very favourable and it appears that the ore body plunges gently to the southeast with the focus of drilling activity extending the mineralisation on 80m spaced drill sections in that direction.

    It now appears, at this stage, that the known mineralisation will be captured by a fairly shallow open pit that has good strike continuity with low strip ratios and nice grades.

    Integra recently took an option on the Red Dale tenements, which are to the north of the Salt Creek discovery, where it has identified an analogous structural and host rock environment with some wide spaced gold anomalies.

    "Recent results we have received indicate that we have an anomaly up there that is 300 metres wide," Cairns said.

    "We don't know what the strike extent is but certainly lines that are 400 metres to the north and south both have strong anomalies as well, so we're infilling that as a matter of urgency.

    "We're really quite keen on that area because it is so similar to what Salt Creek was before we put the RC discovery holes in. So, all things going our way, we could have another discovery on our hands in the not-too-distant future."

    The significance of Salt Creek and Red Dale to Integra, if there is an analogous system present, is that it is likely to provide the company with the confidence to progress to development on a very strong operating basis. Not only does the company have a strong resource base at a very attractive grade, it also has a 1.4 million tonne per annum gold facility in the recently purchased New Celebration plant.

    The configuration of the New Celebration crushing and grinding circuit, with three-stage crushing and two ball mills, does give Integra some flexibility in addressing the scale of development.

    "I suppose the terms of where we do locate the mill will be determined by the scale at which we develop, which in turn will be determined by how large Salt Creek is and if there is another system at Red Dale," Cairns said.

    "Moving forward I expect a strong flow of results from Salt Creek and hopefully Red Dale comes up with the goods and we are on a second discovery."

    Then the focus for Integra in the next six months will be answering those questions of scale and location of the New Celebration facility.

    There is potential for Integra, due to the recent transaction between Harmony and Dioro for the latter to acquire a 100% interest in South Kalgoorlie Mines, to negotiate to leave New Celebration where it is, which would be a low capital cost option but trucking charges would add to the operating cost.

    The alternative for Integra is to move the mill to the Mount Monger Gold Project it recently purchased from Solomon. Mount Monger has a permitted mill site on its leases along with an established bore field with underground pipeline to the minesite.

    The project hosts a number of previously mined open pits and smaller underground workings that seem to be very suitable to in-pit tailings storage and it is also close to some of the electrical infrastructure in the area.

    The other wild card held by Integra is a farm-in with Barrick in the Oodnadatta Project in the Gawler Craton, South Australia. The target is Olympic Dam-style copper/gold/uranium mineralisation.

    "Barrick has informed us that they intend drill testing four of six anomalous targets that they have identified," Cairns said.

    "If they were to hit something significant, we would have a 20 percent position in that which would add a small amount of spice to Integra."

    Integra has established a track record of delivering on what it has set out to achieve establishing its bona fides as a successful explorer. Given the quality of its resources, its demonstrated capacity for discovery and the infrastructure that it owns, in terms of a permanent mill site and a processing facility, combined with the farm-in with Barrick, the company is a very cheap exposure to gold for investors.

    "Our philosophy as a gold company is that we are gold tragics," Cairns said.

    "We do believe that gold will take off. We think that the fundamentals are very strong in terms of increasing demand and decreasing supply. Having said that, our strategy has remained simple and that is that when gold does take off and investors are looking for exposure to a gold growth company, Integra is going to be leading the parade."

    * This report, first published in the October 2007 edition of RESOURCESTOCKS magazine, was commissioned by Integra Mining


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    More sweet results from Salt Creek
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    SHARES in Integra Mining increased 9% this morning after the company reported further gold mineralisation at depths less than 100m at the Salt Creek gold discovery in its wholly-owned Randalls project near Kalgoorlie, Western Australia. - more

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