80 Mile PLC (AIM: 80M, FSE: S5WA, OTC: BLLYF) said Monday that drilling is under way at its Disko-Nuussuaq nickel, copper, cobalt and platinum group metals project in West Greenland, marking the start of the first systematic drilling program at one of Greenland’s most closely watched mineral exploration prospects.
The drill rigs have been cemented at the first locations and pressure testing has been completed successfully. Drilling is now advancing toward the top of the target zones, with each hole planned to reach a maximum depth of 1,000 meters, subject to geological review and conditions at the rig site.
Quick Disko Background
Disko has been promoted for years as a possible geological analogue to the Norilsk-Talnakh nickel and copper district in northern Russia. The project lies within the West Greenland Flood Basalt Province, which has geological similarities to the Siberian flood basalts hosting Norilsk. Cominco, now Teck, first recognized the comparison.
Across approximately 3,000 square kilometers on Disko Island and the Nuussuaq Peninsula, 80 Mile has identified seven magmatic massive sulfide targets. The largest is described as 5.9 kilometers long and 1.1 kilometers wide.
Some of the strongest surface evidence cited by 80 Mile comes from a 28-ton massive sulfide boulder found within the license area. According to the company, it assayed 6.9% nickel, 3.7% copper, 0.6% cobalt and two grams per tonne of platinum group metals. The boulder is displayed at the Danish Geological Museum in Copenhagen.
Surface sampling has also returned average values ranging from 4.6% to 9.3% nickel and 1.5% to 2.8% copper. 80 Mile has pointed to coarse, interlocking sulfide crystals in hand specimens as evidence of the geological conditions associated with large mineral accumulations.
The new holes will begin testing whether the identified geophysical targets contain mineralized sulfide bodies at depth.
Five Thousand Meters Funded by USFM
The initial campaign is planned to cover approximately 5,000 meters using two diamond rigs supplied by Forage Fusion Drilling. SRK Exploration has been appointed geological manager. In May, 80 Mile said a US$7.5 million campaign budget had been approved and funded.
The work is funded by USFM Corporation under an earn-in agreement finalized in May. USFM will fund US$30 million of expenditure to earn up to a 51% interest in Disko. 80 Mile will manage operations during the earn-in period and will retain a free carried 49% position through completion of the earn-in.
Under the definitive agreement, 80 Mile will also receive a 10% management fee on project expenditure and a US$500,000 cash payment.
The structure gives 80 Mile substantial exposure to any discovery while USFM funds the current exploration risk. If the full earn-in is completed, USFM will hold the majority interest and 80 Mile will retain 49%. Geological conclusions will have to wait for the core and subsequent assays.
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