EL 1616 – Bulolo
This tenement covers the vast bulk of historic gold production from within the Morobe Province. This gold production has come from gold dredging of the Bulolo Gravel Flats between 1934 and 1965, although significantly interrupted during World War II. EL1616 contains the best of the historically productive Bulolo gravel flats. Gold production from these gravel flats totalled 2.15 million ounces from the processing of approximately 200 million cubic metres of gravel at a recovered grade of 0.31g/m3 Gold. EL1616 covers the majority of historically dredged area, but also hosts significant areas of virgin gravel beds.
PNM is focussed on testing and bringing to production three main zones within the gravel project being:>
- Virgin, unmined zones – There are several areas within EL1616 which flank previously dredged areas, and are the priority target for initial testing and production. One area at the southern end of the tenement, immediately west of previously dredged areas is approximately 2 km x 1km in area, and is expected to host significant volumes of economic mineralisation.
-
| Previously dredged gravels – it is considered likely that dredging methods employed historically resulted in significant gold losses. Review of historical records indicates that only recovered gold grades were measured, and actual in situ grades are unknown. Initial testing indicates that gold remains in the previously dredged areas, and PNM has a bulk sampling program in place to better quantify the economic potential of these zones. |
 |
Panned gold recovered from historical tailings area
|
- Depth extensions of previously dredged areas – seismic interpretation of the field undertaken in 2010 indicated that the overall depth of gravels extends beyond 100 metres. Dredging depths were restricted to between 30 and 35 metres, and PNM believes that there is excellent potential for additional gold recovery from below historically mined horizons.
Testing is to be undertaken by two primary methods, being bulk sampling of material mined from a grid of test pits to be excavated across all zones in the field, and with churn drilling to basement using a cable tool rig. Data from the test program will be utilised to select initial areas to be brought into production.
PNM has recently completed the construction of a 10 t/hr test plant for the bulk sampling of the Bulolo Gravels, and has mobilised contract machinery, including a 20t excavator to site. Preparation of drill pads and access tracks was well advanced at the end of the reporting period. The churn drilling contractor has commenced drilling subsequent to the end of the reporting period.
PNM also purchased a commercial scale production plant intended for use at Bulolo during the previous year. Pacific Niugini purchased the gravity processing plant capable of processing approximately 400tph of -3mm material during the September 2010 quarter. It is estimated that the plant capacity will translate into 10,000 – 15,000 m3 of raw gravel per day. Pacific Niugini is currently undertaking minor modification on the plant in preparation for production.
Based on historical production grades, the plant with the appropriate pre-screening additions is expected to facilitate production in excess of 30,000 ounces per annum once operational.
Commercial scale production plant owned by PNM
Whilst the main focus within this tenement is the assessment of the remaining Bulolo Gravels and a re-start of commercial scale gravel processing for gold, there remains significant potential within this tenement for primary sources of epithermal gold and porphyry copper style mineralization.
In the past, Bulolo Development Company, CRAE, and the PNG Geological Surveys for primary ore sources have completed sporadic exploration within the tenement. Target metals of past explorers were mainly gold and copper.
PNM has completed ground reconnaissance programs on the tenement and has outlined significant anomalies from stream sediment, ridge and spur and rock-chip sampling. These areas will be revisited once the gravel project is fully operational.
Plan of EL1616 highlighting results from initial sampling outside of the Bulolo Gravel Project