Channel Resources Ltd. (CVE:CHU) late Tuesday provided a corporate update as it filed its NI 43-101 technical report on the Mankarga 5 maiden resource estimate for the Tanlouka project in Burkina Faso, West Africa.
As announced in July, the report identified Indicated Mineral Resources of 14.1 million tonnes at 0.94 grams per tonne (g/t) gold for 425,000 gold ounces and Inferred Mineral Resources of 29.1 million tonnes at 0.78 g/t gold for 729,000 gold ounces.
With the announcement of a maiden resource estimate at Tanlouka, Channel has achieved an important milestone in demonstrating the potential of the Tanlouka Project.
From the first hole drilled on the Mankarga 5 structure to the present, over a period of two years, a NI 43-101-compliant resource has been established with a major new resource contained within a single open pit shell. The mineralized structures at Mankarga 5 remain open down-dip and along-strike with potential to add to its gold inventory.
"We are very pleased with the progress that our team has made on the Tanlouka project," Channel's president and CEO Colin McAleenan commented.
"While the very difficult market conditions prevailing over the past six months and especially over this summer have limited the impact of our achievement in the markets, we believe that we have created real value for shareholders that will, in time, be reflected more faithfully."
Tanlouka's expected growth over the next year will be driven not only by a potential market recovery but on a demonstration of the expansion potential of the Mankarga 5 deposit, which remains open along strike and to-depth, further drilling to determine the extent of mineralization at Mankarga 1 and Mankarga 1-South targets, and also on work underway to add new discoveries in other target areas.
Chief among these include the Manesse and Tanwaka targets, approximately five and ten kilometres north of the Mankarga zone, originally identified in historic regional geochemical surveys.
Channel has recently followed up on these targets with extensive 100 metre by 25 metre soil surveys, the results for which are expected soon. In addition to the identified targets of Mankarga, Manesse and Tanwaka, the company will begin exploring the western third of the property, which has not yet seen any fieldwork.
"To-date, the exploration of the 79 square kilometer Tanlouka property has been focused on the six square kilometer Mankarga area in the south," McAleenan continued.
"Now that we have identified our first major deposit on the property on which there is ample expansion potential through additional drilling, we are now just beginning to look at some of the additional exploration potential that the permit has to offer.
"What we are particularly excited by is the level of artisanal mining activity on both Manesse and in particular on Tanwaka, which serves to increase our confidence that we will be able to generate strong drill targets in both of these areas."
Channel Resources said further work is also planned to prepare the Mankarga 5 deposit for economic assessment including further metallurgical studies to expand on preliminary work. While these initial results have demonstrated the free-milling nature of gold mineralization in both oxide and fresh-rock samples, column leach tests on both types of rock and transition material will allow for more definitive estimates on project development costs for heap-leach and CIL milling production scenarios.
The recent metallurgical studies have also included environmental testing on the different rock types, establishing minimal arsenic content and minimal potential for acid-rock drainage from the Mankarga 5 samples. Further environmental testing is also planned, including the collection of weather and other environmental data necessary for an environmental impact assessment of the project.
Corporate social responsibility-related activities have also been initiated.
While these exploration and pre-development activities have taken place, the company has also prepared for the project's future advancement through a build up of local corporate and project infrastructure.
As Channel earned its 90 per cent interest in the project a Burkina Faso subsidiary, Tanlouka SARL, was formed to hold the interest and to directly manage the project and an office has been opened in Ouagadougou, Burkina Faso's capital city.
The company's existing exploration 'base' in the town of Mogtedo, just north of the project permit, has been upgraded and a new compound, complete with core storage facilities, has been constructed proximal to the Mankarga 5 deposit to facilitate future drilling programs.
"In a very short period of time since our first discovery hole at Tanlouka in 2010, Channel has demonstrated its ability to advance the project quickly and efficiently," added McAleenan.
"With only a small corporate group in its Vancouver office, we have devoted the bulk of our resources to advance the project and build a dedicated and effective technical and logistical team in Burkina Faso, resulting in a discovery cost for the gold in the recent resource estimate of only approximately $5 per ounce.
"With approximately $2 million in cash in the treasury, we believe that the company is in a good position to weather current markets while continuing to deliver results from Tanlouka that highlight its exploration and development potential."
Regarding Fox Creek, the company's Mineral Brine project in Alberta, the company said it believes that the project presents a unique opportunity for Channel to capitalize on rising demand for these roducts while at the same time maintaining Channel's focus on gold exploration and development.
Channel has a 100 per cent interest in the Fox Creek Mineral Brine Project in Alberta, where it is assessing the project's potential to produce a package of industrial mineral products, including salt, lithium carbonate, potash, bromine and borates, from brine produced from natural gas wells.
The company has since developed a process flowsheet for the production of mineral products in multiple stages in what it believes is the most efficient manner, utilizing well-established technologies.
These results are being used in an internal assessment of the project's potential commercial viability in order to prepare the project for a strategic transaction, which may include its joint-venture, spin-off or outright sale to market-specific players.
"The Fox Creek project, given its size and proximity to extensive industrial and energy infrastructure, has potential for development in the near-term", commented McAleenan.
"Although non-core to Channel's primary asset development strategy, we have been able to advance the project in a meaningful way so that we are now close to finalizing the results of our research into the viability of developing this unique resource."