Categories: Precious Metals / Mining Stocks
Topics: Gold Stocks / Copper Stocks

Hannan Metals (TSX-V: HAN)(OTC: HANNF) CEO Michael Hudson on Expanding the High-Grade Gold Discovery at Previsto and Early Drilling at Vista Alegre

 

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the chairman & CEO of Hannan Metals (TSX-V: HAN)(OTC: HANNF) — Mr. Michael Hudson. Mike, how are you today?

Michael Hudson: I'm very well — top of the world down under! Thank you, Gerardo.

Gerardo Del Real: We were overdue for a catch-up. You’ve been busy building and expanding on a billion-dollar — and soon to be multi-billion-dollar — discovery over at Southern Cross Gold and Sunday Creek. Now we’ve started that process at the Valiente Project with several targets, and we’re still in the early stages of figuring out the systems there.

But you had some news on July 2nd that I thought was pretty important. We’ve talked about Previsto Central — “The Monster” — being a sea of gold with very high-grade pockets. And now, the team, the way I understand it, is expanding the footprint to figure out just how big those high-grade pockets are and how many potentially there are.

The latest release, I thought, was a really important one where you expanded the gold footprint to a 750-meter strike. The trenches included 4.6 meters of 7.2 grams per tonne gold in a 30-meter step-out. So I just wanted to have you on to provide some context about how you’re approaching the sampling at Previsto because I know there are a lot of eyes watching that emerging discovery while we also try to make discoveries on the three projects we’re drilling this year.

Michael Hudson: Exactly. So Previsto is a massive system. It’s a 5 by 5 kilometer area. In terms of footprint, it matches very well with systems like Cripple Creek or Porgera, which are some of the biggest alkaline gold systems on Earth. 

And we only just started to make this discovery earlier this year. These higher grades — I think we first announced them in January — started showing up when we began finding the higher-grade parts of the system.

We’ve been working our way around that high-grade zone. We extended it from about 25 meters; 26 meters at 5.4 grams. Then, we expanded that to a larger zone: 130 meters at around 1.5 grams. And then we stepped away from it and found multiple high-grade areas within tens of meters. We’ve seen the half-ounce numbers: 2.3 at 18, etc.

Now, we’ve stepped out a bit further to the east and found results that included 13.5 meters at 2 grams and 4.6 meters at 7 grams. It’s very important to understand that these are just where we’re finding outcrops. This is high jungle. The team has to strip back vegetation, find the outcrop, strip it back again, and then channel sample it. So it’s not as if the outcrop is everywhere; they’re more like windows of insight into the system. And it’s incredible that we’re able to find these kinds of grades with that form of exploration.

So now we’ve extended the system, like you said, over 750 meters. There’s a lower-grade footprint of about 0.2 to 2 grams across that strike with the area of interest I mentioned being roughly 100 by 50 meters as a subset of that. Lots of opportunity to find more high-grade zones.

In fact, about 250 meters from that high-grade zone I just talked about, we took a representative sample — meaning we took multiple samples from a one-meter-squared area that was exposed at surface — and it averaged 2 grams. That’s a 250-meter step-out so obviously there’s a lot of work to do around that too.

There’ll be a lot more high-grade results. I’m fairly confident we’ll be bringing them to the table as we pull this apart. That’s what these alkaline systems are: very high-grade in smaller parts of a much larger volume. This sea of low-grade gold that you referred to — that’s exactly what we’re seeing. 

That’s what Cripple Creek is and was. It was very high-grade in the early days. Now it’s a much lower-grade heap leach system. And we’re just at the beginning stages of delineating those high grades, which are obviously our target.

Gerardo Del Real: Excellent. I think everyone’s in agreement that we know the potential and scale, and that we have a massive discovery on our hands at Previsto. You’re drilling right now, starting with one of the projects — one of the targets — at Vista Alegre. I understand there were two drill holes completed and you were advancing a third. How is that going?

I mean, you’re drilling blind into an area that’s never been explored with modern exploration of any kind… and that’s a process, right? We saw that at Sunday Creek. Although, in fairness, at Sunday Creek, you did kind of come out of the gate with some good numbers.

But we know that exploration takes a bit. How are things coming along? How’s the drilling going technically, and where are we at?

Michael Hudson: We are drilling about 22 kilometers to the southwest from our previous drill sites in a slightly different part of the world. We’ve been drilling there for the last month and a half, I’d say. We just finished the third hole literally as we speak, and we’re now waiting for assays, which should come in the next three to four weeks.

Drilling has been a little slower as we’ve been getting used to the rocks. But the team on the rig has been making great headway in understanding the rocks and figuring out which drilling muds to use, etc. The third hole went much faster than the first, as they got more familiar with things.

Socially, everything’s going well, and we’re really looking forward to the assays and sharing them with you and your listeners. We’ve got three to four holes planned across Vista Alegre, Ricardo Herrera, and Sortilegio initially. We have some decisions to make as to whether to drill another hole at Vista Alegre or move on to Ricardo Herrera where we’ll drill three or four holes as well. Then we’ll head to Sortilegio and do the same.

This spans over 9 kilometers; two porphyry systems with an epithermal system wedged in between, like the meat in a sandwich, if you like. These are the first holes drilled within 50 to 60 kilometers of anything else that’s ever been drilled in this part of the world. So really, really exciting stuff and true frontier exploration.

Gerardo Del Real: No doubt… it’s exciting times. I can’t wait to see what the first set of holes reveals. Obviously, we all root for a discovery but we also know that with exploration, you want to get into the system, start to understand it, and begin deciphering what’s there.

That’s the fun part. I love adding value with the drill bit. I’m excited that we’re going to get information from three different — what I call — projects. Some people call them targets but to me they’re three distinct projects.

I think you mentioned the program should last roughly six months. By year-end, we’ll have a much more informed opinion about the potential. Anything you’d add to that, Mike?

Michael Hudson: Wise words, Gerardo. You want to find the best parts of these systems — ideally sooner rather than later — and then rank those targets to come back and drill the best parts of the better system. This is the first real look at understanding them. Like I said, never been drilled before. Exciting times indeed, and that’s the business of exploration.

Gerardo Del Real: Looking forward to it. Last but not least, I’ve got to ask, on the social side at Previsto, with the permitting process really starting to get underway, how are things progressing?

Michael Hudson: We’ve got 10 to 15 people on site right now collecting all of the baseline environmental data for the DIA — the Declaración de Impacto Ambiental — which is our version of the EIA, the Environmental Impact Assessment, for drill permitting.

We’re getting close to having all of the data collected: air, soil, vegetation, animals, along with archaeological work. We already know there are no archaeological artifacts in the area, for example. It’s really important to do all of that work to ensure the impact is minimal — ideally zero — during exploration.

We hope that work will be completed and compiled into a report by Q3 this year, which we’ll then submit to the authorities for permitting. We know Peruvian authorities aren’t the fastest drill permitters on Earth but we’ve challenged them to get this done in six months from submission. The last one took about 11 months but things are improving. They’ve been supportive and understand what we’re doing.

And because this isn’t the first permit we’ve done in these areas, everyone’s learned more, us included, about how to prepare the data and how the authorities want it presented. The authorities also have more comfort now, having been through the process with us before.

Gerardo Del Real: No doubt; true frontier exploration. I rewatched the movie Gold the other day with Matthew McConaughey and it took me right back to my hike through the jungle during my site visit. Really good stuff. Mike, thank you so much. Looking forward to having you back on soon.

Michael Hudson: Fantastic stuff. Thanks, Gerardo.

Gerardo Del Real: Cheers.

Click here to see more from Hannan Metals Ltd.