HISTORY OF PAYNE’S FIND GOLD AREA
Gold was first discovered at Payne’s Find in 1911. The Payne’s Find Mining Centre, within the project area, was reported by the GSWA as having produced 2,204kg from 89,850 tonnes at an average grade of 24.5g/t.
In 1987, Falcon Australia Ltd commissioned geologists KH Morgan & Associates to conduct a review of the Pansy prospect (now within M59/662). From an assessment of 22 percussion drill holes (PO01–PO22), identified 18,500 tonnes at a grade of 4.5g/t gold for blocks remaining in the underground workings at the Pansy prospect. Recommended work includes a more detailed investigation of PC1 costean, where a 3m channel sample returned 18.3g/t Au.
This prospect is contained within the current project area and is at the southern end of the Primrose Fault as displayed in the map below as Drilling stage 1, which is estimated to be some 4 -5 km long and travels from North to south of the entire Project area, and is a high-value target in our future exploration.
The board of Cervantes considered a range of factors in accessing the attractiveness of the Paynes Find Gold Project, including but not limited to;
Sovereign Risk: This project is located in one of the most supportive and friendly mining States and Countries in the World
Easy Access: This project is only 4.5 hours drive North of Perth on bitumen roads
Safety: The project is near an airstrip and supported by the local Royal Flying Doctor Service, Volunteer Fire Brigade, First Aid Post and weather station, run by locals who are passionate about the district and very supportive of the development of the Project.
Accommodation and employee facilities: The local Roadhouse immediately adjoins the project area providing accommodation, meals and storage facilities. The owner has adjoining permits, is very experienced in the area and has worked in the underground mines, as did his grandfather. Some of those underground mines and their workers made Australia one the world’s great mining countries. One of some 37 underground mine entrances is shown in a photo attached.
Access to equipment and other services: The roadhouse owner also owns most of the earth moving equipment necessary for the basic operations and thereby eliminating most Mobilization costs.
A Head Start: This is not a Greenfields project with large risk factors. It is a well known Gold Field discovered in 1911 with numerous mines worked by old miners using basic equipment and only chasing 25g/t plus workings. Old and recent Drilling programs have verified substantial gold existence at shallow depth and some high-grade intercepts, which could allow an early JORC resource.
Processing Facilities: Whilst the eventual resources may very well support a standalone plant, 2 mills exist in the district owned by Chinese who are seeking ore for the mills. Should discussions down the line prove successful this would eliminate major CAPEX Costs.
Early cash flow: In addition to the potential as outlined of an agreement with local mills, the project area has substantial alluvial areas, which have previously been successfully worked by locals. Subject to a short program of verifying tonnes this could easily provide sufficient early cash flow to fund a substantial portion, if not all of the exploration budgets.
Costs to access and transport staff, consultants and equipment: The costs of running exploration programs for remote areas, especially in other countries can be excessive and especially for flying in and out staff and mobilizing and demobilizing equipment. None of these costs exists for this project.
PREVIOUS EXPLORATION RESULTS – PAYNE’S FIND GOLD PROJECT
The Payne’s Find Gold Project was actively explored by Payne’s Find Gold from 2011 through 2013. During this period, two phases of drilling were undertaken in 2011 and 2012.
- 69 Reverse Circulation holes for a total of 3,800m.
- 51 Reverse Circulation holes for a total of 5,326m
- 6 Diamond Drill holes for a total of 1,540m.
Prior to these phases, several other firms had completed drill holes that fell within the area of the Phase 1 program and have been previously reported both by the operating companies and by Payne’s Find Gold.
- Hallmark Resources – 2002
- Kirkwood Gold NL – 1997
- Falcon Australia Limited – 1987
- Forsayth Mineral Exploration – 1987
Significant Intersections of gold from these various drill campaigns, that have been previously announced by Payne’s Find Gold include:
- 20m at 1.8 g/t from 20m (HPFRC019)
- 13m at 1.4 g/t from 60m (HPFRC021)
- 9m at 1.6 g/t from 24m (HPFRC025)
- 11m at 0.9 g/t from 83m (HPFRC027)
- 10m at 1.8 g/t from 18m (PFRC010)
- 6m at 2.4 g/t from 39m (PFRC059)
- 6m at 1.9 g/t from 20m (PFRC018)
- 6m at 1.9 g/t from 28m (PFRC005)
- 5m at 1.6 g/t from 26m (PFRC069)
- 7m at 2.43 g/t from 115m (PFRC115)
- 12m at 6.61 g/t from 115m (PFRC116)
- 3m at 8.04 g/t from 45m (PFRC134)
- 3m at 5.21 g/t from 140m (PFRC134)
- 3m at 8.05 g/t from 77m (PFRC135)
- 4m at 6.28 g.t from 79m (PFRC150)
- 6m at 3.56 g/t from 120m (PFRC150)
- 3m at 3.21 g/t from 30m (PFRC142)
- 4m at 2.64 g/t from 99m (PFRC133)
- 3m at 4.94 g/t from 114m (PFRC112)
- 2m at 4.94 g/t from 82m (PFRC135)
- 3m at 92.1 g/t from 41m incl. 1m at 271 g/t (PFRC120)*
*Of significant interest are the results in PFRC 120 in as above.
HISTORICAL ESTIMATE OF MINERALIZATION
Despite a long history of mining, no Mineral Resource Estimates compliant with the JORC 2012 code or previous iterations have ever been calculated or published within the Payne’s Find Project area.
However, one Historical Estimate of Mineralization was published on the small Pansy Deposit, south of the main Payne’s Find field (M59/1957), which was mined up until the mid-1980’s.
The deposit was mined as a small pit, extending to a depth of between 4 and 8m, but no reliable production results are available.
Falcon Australia undertook a 22 hole RC drilling program for 795m in 1987 to test the depth extension of mineralization beneath the historical pit, with these data being assessed in a 1987 report that modelled a small Historical Estimate shown below in table 1.
The drill holes within this program were shallow – with the deepest reaching a down hole depth of only 63m. These holes intersected gold mineralization at a maximum depth of some 30m, but with mineralization remaining open at depth.
Categories of Mineralization: The Historical Estimate outlined in the above report was before the JORC code came into common use and as such the “Indicated” classification quoted is not considered to be reliably comparable to the current JORC 2012 categories. It is not known how this category was defined.
Relevance and Materiality: The Historical Estimate is both relevant and material to Cervantes as a demonstration of the continuation of potentially economic mineralization beneath a previously mined pit. As such, this work represents a high priority exploration target.
Reliability: The Historical Estimate detailed in the above table, was based upon drilling undertaken in 1987 for which no QA/QC records remain.
In addition, Cervantes feels that the Historical Estimate is based upon a geological interpretation that may require modification as a result of additional information that has become available from later drilling in the region.
As such, while the data behind this Historical Estimate is considered reliable, the Historical Estimate requires modification to take into account additional information.
Details of Previous Work Program: This Historical Estimate was based upon assay results from 22 percussion holes drilled in 1987 by Falcon Australia Ltd. Paper geological logs of the drilling are available but no information is available relating to any QA/QC procedures and it is thus likely that none were undertaken. Estimation was carried out on the basis of a rudimentary tabular geological interpretation that assumed one broad mineralized zone. It is felt by Cervantes that this interpretation requires modification to take into account later information.
Future Work Programs: Cervantes plans to undertake work programs that, if successful, may move this Historical Estimate into compliance with the JORC 2012 Code.
Subject to funding and regulatory approval, this work program will include:
- Ground magnetic surveys to better define small granitic intrusive bodies that may control mineralization.
- Digitizing of drilling information and development of ore body models.
- Additional drilling designed around new structural interpretations.
- Additional drilling at depth.
- Implement appropriate QA/QC protocols in accordance with JORC 2012 guidance.
Timing of this work program is subject to regulatory approval by the Western Australian Department of Minerals and Energy, however it is planned that such work may take place in Q3/Q4 2017.
The Historical Estimates are not reported in accordance with the JORC 2012 Code. A qualified person has not completed sufficient work to classify these Historical Estimates as Current Mineral Resources in compliance with the JORC 2012 code. Cervantes plans to carry out an exploration program on the tenement, but it is uncertain that such a program will allow reporting of a Current Resource at Pansy in compliance with the JORC 2012 Code.
Competent Persons Statements
Information contained in this report which relates to historical exploration results for the Payne’s Find Project, is based on, and fairly represents, information and supporting documentation compiled by Mr Rodney Dale, a competent person who is a Fellow of the Australasian Institute of Mining and Metallurgy, by CSA Global and Mr Bradley George, on behalf of Mr Rodney Dale.
Mr Dale consults to Cervantes Corporation on a part time basis, and consulted to Payne’s Find Gold Limited during its exploration programs from 2011 through 2013. Mr Dale has sufficient experience that is relevant to the style of mineralization and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.
Mr Dale consents to the inclusion in the report of the matters based on this information in the form and context in which it is appears.
Information contained in this report that relates to the summarizing of Historical Estimates is based on information compiled by Mr. Bradley George, a competent person who is a member of the Australian Institute of Geoscientists. Mr. George is an employee of Total Earth Solutions Pty Ltd and consults to Cervantes Gold Limited on a part time basis. Mr. George has sufficient experience that is relevant to the style of mineralization and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.
Mr. George attests that the information in this announcement related to Historical Estimates is an accurate representation of the available data and studies for the Pansy project. Mr.George consents to the inclusion in the report of the matters based on this information in the form and context in which it is appears.