The property is located in northwest Queensland, Australia. It is situated approximately 175 km southeast of Mount Isa, 130 km south-southeast of Cloncurry and 700 km west-southwest of Townsville. Within 30 km of the property, there are a number of producing mines in the area, including, BHP Billiton’s Cannington Silver Lead Zinc Mine, Chinova’s Osborne Copper-Gold operations and Starra Gold-Copper Mine. Pegmont is proximate to existing infrastructure that includes roads, railhead and natural gas for power generation.
Exploration expenditures for the property comprise $800,000 before 10 August 2015 (complete); $1,000,000 before 10 August 2016; and $1,200,000 before 10 August 2017. A minimum 17,000 m of drilling must be completed before 10 August 2018 with the requirement of completing 2,000 m of this total prior to the end of 2014 (complete) and commencing a minimum 3,000 m program prior to 30 April 2016. Vendetta Mining Corp has completed 4,219 m of drilling to date.
In the event of Vendetta exercising the option and as part of the final transfer of project titles, the Company has also agreed to pay an advance royalty to the Vendor of $3 million. Vendetta will receive a royalty credit of the cash option payments and advanced royalty for a total of $5.25 million, to be credited against future royalty payments.
The Vendor will retain a royalty right on future concentrate production from the property of 1.5% of net smelter return, subject to the credit of $5.25 million in favour of the Company. In the case where ore is sold rather than concentrate, a separate royalty formula allows for a royalty of $1.05 per tonne of ore sold, indexed to lead prices and to be conveyed to the Vendor, again subject to the $5.25 million credit. Where ore that is sold contains silver at concentrations above 64 ppm, an additional royalty amount is payable, starting at $0.06 per gram, indexed to the price of silver.
Independent consultant AMC Mining Consultants (Canada) Ltd., (“AMC”) completed a Mineral Resource Estimate for the Pegmont lead-zinc deposit in accordance with the requirements of National Instrument 43-101. The Mineral Resource includes Zones 1 to 4 and is tabulated below:
|Oxidation State||Mineral Resource Category
|Pb %||Zn %||Ag g/t|
*Notes on the above table:
The Pegmont lead-zinc deposit is considered to be a body of stratiform lead-zinc sulphides contained within a metamorphosed silicate facies banded iron formation (BIF). It is considered an example of a Broken Hill Type (BHT) deposit.
The Broken Hill lead-zinc-silver deposit, located in New South Wales, is the archetype for this style of lead-zinc-silver deposit. Broken Hill is classed as a “super giant” and is believed to have originally contained in excess of 280 Mt, and is the largest zinc-lead-silver accumulation on Earth (Huston, 2006). The world class Cannington silver-lead-zinc deposit, located 25 km to the east of Pegmont, is another important example of a BHT deposit. Other examples of BHT type deposits include; Zinkgruvan (Sweden), and Aggeneys-Gamsberg district deposits (South Africa).
In Australia, Broken Hill-type deposits occur in dominantly sedimentary basins that have been overprinted by high-grade (upper amphibolite to granulite) metamorphism. These basins, which include the Broken Hill block and the Eastern succession of the Mount Isa inlier, are dominated by siliciclastic sedimentary rocks, with minor but genetically important felsic volcanic rocks, granites, and tholeiitic mafic sills.
Both Broken Hill and Cannington consist of a series of stacked lenses with Ag, Sb, and F abundance increasing stratigraphically upward, and with Au, Bi, and Cu abundances decreasing. Stacking of ore lenses suggests that Broken Hill and Cannington were the sites of long-lived and episodic hydrothermal vents. A Pegmont, there is an indication of two stacked lenses.
Broken Hill type deposits exhibit post depositional modifications. High-grade metamorphism (amphibolite facies), metasomatism, and deformation have all affected the morphology and architecture of Broken Hill-typ deposits, coarsening the ores, converting original alteration assemblages to metamorphic mineral assemblages partially melting ore minerals, and remobilizing and upgrading ore into high-grade zones.
Within the Proterozoic Mount Isa-McArthur basin there are six world class lead-zinc-silver deposits (Mount Isa Hilton, George Fisher, Century, MacArthur River and Cannington). On a regional scale they are spatially related however the Broken Hill type deposits (Pegmont and Cannington) differ from the other Mount Isa type sedimentary deposits in the following ways:
The Mount Isa Inlier is a multiple deformed and metamorphosed Early to Middle Proterozoic terrain. The inlier has been subdivided into three broad north-trending Provinces – the Western, Kalkadoon-Ewen, and the Eastern Fold Belts, based on various tectonic, structural and paleogeographic criteria. The Eastern Fold Belt is subdivided into a further three zones, from west to east; the moderately deformed Wonga and Quamby-Maldon Sub-provinces and the structurally complex Cloncurry Sub-province.
The Western Fold Belt contains the sediment hosted, stratiform world class Mount Isa, Hilton, George Fisher Lead, Zinc, Silver deposits and the Mount Isa copper deposit. The Eastern Fold Belt, in particular the Cloncurry Sub-province contains deposits of a different character including several significant iron oxide copper gold deposits (Ernest Henry, Osborne, Mt Elliot, and the Starra deposits) and Broken Hill type lead, zinc, silver deposits including the world class Cannington and several smaller examples of which Pegmont is the largest.
The deposit scale geology at Pegmont has been the subject of a number of scientific studies including the unpublished Ph.D thesis of Vaughan (1980) and Newbery (1990) which was completed prior to the most of the drilling which occurred from 1998. There are few outcrops on the Property, therefore the Geological Frame work of the Pegmont deposit draws not only on surface fact mapping but is also heavily reliant on drillholes and interpretations of geophysical surveys.
The informally named “Pegmont Beds” are a monotonous sequence consisting mainly of psammitic (quartz-feldspar-biotite) gneiss, feldspathic quartzite and psammo-pelitic (quartz-feldspar-biotite-muscovite) schist, with subordinate pelitic (quartz – muscovite – biotite ± graphite) schist. Narrow bands of tourmaline bearing schist are locally developed. The schists have a well-developed foliation and lineation and, in places, a crenulation cleavage. The sequence is thought to represent a metamorphosed clasitic sedimentary sequence, originally feldspathic and lithic sandstone and siltstone, with subordinate fine clastic (in part carbonaceous) sediment.
The overall morphology of the stratiform mineralized horizon at Pegmont is a flat, gently easterly dipping sheet. The known mineralization extends approximately 2 km along strike and approximately 1 km in the down dip direction to the southwest. At present mineralization is known to extend to a depth of 350 m below surface. Lead-zinc mineralization occurs in the Main and Footwall BIF’s. Mineralization in the Main BIF is around 2 to 6 m thick.
A succession of operators has explored the area over the past 30 years. This has resulted in a database consisting of the results of 408 drillholes for 44,745 meters. The drilling is a mix of percussion, reverse circulation, (RC), and diamond drilling, (DD), and most core and chip trays are present at site. Most drillholes in the Pegmont project area have been drilled to relatively shallow depths and are vertical. 46% of All drill-holes drilled with diamond and/or RC are less than 100 m long and 77% are less than 150 m long. The deposit remains open down dip to the SE, and down plunge to the NE and SW.
Vendetta is undertaking a series of drilling programs whose initial focus is on Zone 5 and Gossan Load areas which do not form part of the current NI 43-101 mineral resource estimate.
The Pegmont Project Timeline (‘Timeline”) above contains forward-looking information including, without limitation, statements as to planned expenditures and exploration programs. The information included in this Timeline addresses future events and conditions and, as such, involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the Timeline’s information. Such factors include, without limitation, the completion of planned expenditures, the ability to complete exploration programs on schedule, the ability to finance further exploration programs, the success of exploration programs, and general market conditions.
Peter Voulgaris, MAusIMM, MAIG, a Director of Vendetta, is a non-independent qualified person, as defined by NI 43-101. Mr. Voulgaris has reviewed the technical content of this press release, and consents to the information provided in the form and context in which it appears.