ALBA Minerals awarded explorational license for additional Gold Mine in Wales
(AIM: ALBA ) has been awarded the exclusive exploration rights to the Gwynfynydd Gold Mine in north Wales and reports on the progress at its current Clogau St-David’s Gold Mine as it nears production.
The Gwynfynydd Gold Mine Licence
Alba’s wholly owned subsidiary, GMOW (Gwynfynydd) Limited, has been awarded an exclusive mineral exploration licence (known as an “Option to Lease Mines Royal”) by The Crown Estate over a 20 km² area (the “Gwynfynydd Licence”) between the northern and southern segments of the Dolgellau Gold Belt which are already held by the Alba Group.
In common with all option agreements entered into by The Crown Estate, the Gwynfynydd Licence will run for a total of six years and is renewable by up to a further four years thereafter.
The licence holder is required to submit formal progress reports every two years. As with Clogau, as and when the Company is ready to proceed to commercial production, Alba will apply to convert the Option to Lease Mines Royal into a formal, long-term Lease.
Alba’s Executive Chairman, George Frangeskides, commented: “We are delighted to have secured the exclusive mineral exploration rights to the Gwynfynydd Gold Mine and its surrounding exploration ground.
Alba now has the exclusive exploration rights across the entire length of the Dolgellau Gold Belt.”
The Gwynfynydd Gold Mine (“Gwynfynydd”) is located close to the town of Ganllwyd in the county of Gwynedd, north Wales (see Figure 1).
Figure 1 – Location of Gwynfynydd
Gwynfynydd lies within the Dolgellau Gold Belt, a known geological formation which forms an arc 26 km long by 6 km wide around the south-eastern and eastern margins of the Harlech Dome (see Figure 2).
The quartz vein (or lode) at Gwynfynydd was discovered in 1860 and started commercial development in 1887.
Over its history, the Gwynfynydd Mine has produced more than 50,000 ounces (in excess of 1.4 tonnes) of gold with an historical mining grade of 15 g/t.
Gwynfynydd became one of the most important mines in the Welsh Gold Field and, together with the Clogau Gold Mine, contributed some 95% of the total gold output from the area.
Clogau and Gwynfynydd are the only two mines which have operated as recently as the late 20th Century.
At Gwynfynydd, production last took place between 1991 and 1999, when 10,000 tonnes of ore was extracted annually from a total resource base of 180,000 tonnes.
All the 20th-century production came from the Chidlaw Link Zone, which varies in thickness from one to eight metres. When the Gwynfynydd mine closed in 1999, an inventory of 140,000 tonnes at a grade of 15 g/t Au was said at the time to be located below and to the east of the Chidlaw Link Zone*.
This deep zone, more than 250 metres below surface, was tested by only a single diamond drill hole from surface (drilled in 1992) and is constrained by faults which are known from surface and underground mapping.
The stated historical Exploration Target for Gwynfynydd Mine is 100,000-400,000t at a grade of 3-15 g/t of gold*.
The licence area of Gwynfynydd straddles the same stratigraphy that is found at the Clogau-St David’s Gold Mine.
The quartz veins, which like Clogau strike north-east to south-west, and are most auriferous (gold-bearing) where they intersect the Clogau Formation, a pyritic and graphitic black mudstone, forming extremely rich pockets of mineralization yielding gold grades up to hundreds of ounces per tonne.
The Gwynfynydd Mine and option area lies within the continuation of this Clogau Shale Formation (see Figure 2).
Figure 2 – Dolgellau Gold Belt
(comprising Clogau Shales (blue) arcing south-east to east of the Harlech Dome)
The gold mineralization is the result of a complex interplay between the host stratigraphy, different mineralization periods, local intrusives and different vein morphologies.
The veins can occur as single discrete veins up to a few meters thick, but often split into zones where the veins split and can rejoin (see figure 3).
These vein systems can be traceable over several hundred meters.
Figure 3: Vein system at Gwynfynydd
No.6 Level (after Ashton, 1981)
Within the high-grade areas, free gold is common and can become very coarse with over 65 per cent reporting to the +300 microns (µm) fraction.
This characteristic provides the opportunity for the recovery of gold using relatively simple gravity methods in the pilot processing plant which Alba has designed and is in the process of installing at Clogau-St David’s.
Strategy and Work Plans
In the past couple of years, Alba has demonstrated a sustained commitment to the work which is required to re-open the Clogau-St David’s Mine for commercial production.
The geological setting at Gwynfynydd is essentially the same as that at Clogau-St David’s.
Furthermore, the nature of the controls on mineralisation at Gwynfynydd are expected to be the same as those with which Alba is familiar at Clogau, and as such the Company is confident that extensions to known lodes and previously undiscovered lodes will be identified at the Gwynfynydd Mine.
All of this work that has been undertaken at Clogau, and the expertise that Alba has amassed in this type of gold setting, will be directly applicable to Gwynfynydd.
In terms of regional exploration, there are over 300 known former workings for minerals in the Welsh Gold Field (see Figure 4).
A large number of these former workings are situated within the Gwynfynydd option area (See figure 4).
Figure 4: Historic Mine Workings (blue dots)
Alba has already rolled out an extensive regional exploration programme over the Clogau section of the Welsh Gold Field, involving a combination of geochemical soil sampling and ground geophysics.
This regional programme will now be extended to the exploration ground at Gwynfynydd, i.e. those parts of the Gwynfynydd licence which are away from the historical Mine workings.
This will enable Alba to ‘join the dots’ between the Clogau and the Gwynfynydd deposits and to compile a comprehensive and unprecedented regional exploration data base of the entire length of the Welsh Gold Field.
Through this work, Alba is confident that new mineralized zones will be discovered at Gwynfynydd to add to the 10 gold target zones which the Company has already identified over the Clogau section of the Welsh Gold Field, covering about nine kilometres in total.
Gwynfynydd: Next Steps
In the first phase of work, Alba’s technical team will seek to capture and integrate all historical data sets for Gwynfynydd within the Company’s overall geological model for the Welsh Gold Field.
In terms of field work, this will initially comprise reconnaissance site visits and inspections. More comprehensive field activities will be planned during Q1 2021, with a view to commencing a field programme in earnest in Q2 2021.
Overall, the Company’s intention will be to roll out at Gwynfynydd the same overall exploration and development work plan that has been developed successfully at Clogau, including:
- Extensive 3D underground scanning survey of accessible workings.
- A geochemical soil sampling programme over the existing mine workings, in order to identify potential extensions to the existing footprint of the Mine.
- An in-mine safety and rehabilitation programme for the key Mine areas.
- Drilling from underground and from surface in order to identify promising structures and extensions to known gold ore shoots. As at Clogau, given the narrow-vein, nuggety effect of the mineralisation, drilling will be primarily for structure rather than grade, as the focus will be on identifying the known gold-bearing geological structures and stratigraphy for follow-up bulk sampling and development.
- Bulk sampling of underground vein exposure, which would then be processed through the Company’s pilot plant at Clogau to provide accurate data relating to the gold content over a more representative sample of ore than can be afforded by drilling alone.
George Frangeskides, added: “Gwynfynydd shares many of the same characteristics and the same geological setting as Clogau-St David’s, and as such we intend to approach the exploration and development activities at Gwynfynydd in much the same way as we have done at Clogau, using all the tools in the extensive modern-day exploration tool-box, from underground 3D mine scanning to geochemical soil sampling, surface trenching, diamond drilling and bulk sampling.”
Update on Clogau St David’s Gold Mine
The Company still expects its pilot gold processing plant to be fully operational by December 2020.
The Company has signed all necessary licences with The Crown Estate to ensure it owns any gold recovered from the processing of the 36-tonne bulk sample extracted during the underground bulk sampling programme which was completed last month.
As such, Alba will be entitled to retain all sale proceeds from the sale of that gold (subject to paying The Crown Estate a Net Realisable Value royalty of 4% of the proceeds of sale), which is not normally the case in the exploration phase of a mining project.
Shares in ALBA have performed strongly over the past three months rising from 0.13p in September to close at 0.45p prior to this announcement.
3 Reasons to Follow Alba Mineral
Diversified Mineral Exploration
Alba Mineral Resources is a well-diversified mineral exploration and development company which owns and operates mining projects in Greenland, Wales and Ireland. Its strategy is to identify and secure undervalued assets with a diversified commodity mix where there is potential for discovering further unexploited resources alongside the existing mine site.
Positive Newsflow from Assays and JORC Resource
Despite losing field time to the ongoing COVID-19 pandemic, Alba said it is in a position to execute one of the most significant underground work programmes seen for several decades at its Clogau gold mine in Wales, just as the commodity is reaching all-time highs in value.
Alba will now move into the formal assaying of all the drilled and sampled material at Clogau, the start of its first phase of regional surface trenching programme and preparations for the surface drilling campaign.
Alba said all its mining projects remain on ‘a sound footing’, with JORC resources at both Thule Black Sands and Melville Bay, and plans to drill a maiden JORC resource at Amitsoq in 2021.
Alba said it does not expect the campaign at Clogau to be affected by Welsh Government coronavirus restrictions which were implemented from 23 October to 9 November 2020.
Transition from Exploration to Production in Greenland and Wales
Other ‘significant’ progress has also been made in recent years towards Alba’s ultimate goal of achieving commercial production at one or more of its sites, including at the Thule Black Sands in Greenland, the Amitsoq project in Greenland and the Horse Hill well in Surrey.
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.