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Trilogy Metals Inc. (NYSE:TMQ) ("Trilogy Metals" or the "Company") is pleased to provide an update on its current corporate and project activities.
Joint Venture Agreement with South32 Limited
On December 19, 2019 the Company and its Joint Venture partner, South32 Limited ((ASX, LSE, JSE: S32, OTC:SOUHY) ("South32"), announced that South32 had exercised its option to acquire a 50% interest in a joint venture company ("Joint Venture") that will own the Upper Kobuk Mineral Projects ("UKMP") located in northwest Alaska.
Trilogy Metals will contribute all of its assets associated with the UKMP and South32 will contribute approximately US$145 million to the Joint Venture. Establishment of the Joint Venture is expected to occur in February 2020 and follows an initial exploration partnership between South32 and Trilogy Metals over three field seasons to advance both parties' geological understanding of the UKMP.
The Company will provide more details on the Joint Venture's planned work program and 2020 exploration activity following its formation. To view the December 19, 2019 press release please go to https://trilogymetals.com/news/2019/south32-and-trilogy-metals-to-form-upper-kobuk-mineral-projects-joint-venture.
Drilling Highlights – Arctic Project
The Company is also pleased to announce final assay results from the geotechnical and hydrological drill program completed at the Arctic poly-metallic volcanogenic massive sulphide ("VMS") deposit (the "Arctic Project"), part of the UKMP located in the Ambler Mining District of Northwest Alaska.
The 2019 Arctic field season was comprised of advanced engineering and environmental work in support of Trilogy Metals' feasibility study for the Arctic Project and permitting. These results will be incorporated into the study which is expected to be completed in the first half of 2020. Following its formation, the Joint Venture intends to undertake further work programs and studies for the Arctic Project.
Geochemical assay results from the geotechnical and hydrological drill program are shown below.
At a cutoff grade of 0.5% copper equivalent* the results from the new assay results at the Arctic Project are as follows:
AR19-164 intersected two mineralized intervals of:
5.8 metres with a copper equivalent grade of 4.54% (1.45% copper, 6.24% zinc, 0.83% lead, 0.28 g/t gold and 32.20 g/t silver); and
16.4 metres with a copper equivalent grade of 7.80% (5.09% copper, 4.82% zinc, 0.53% lead, 0.47 g/t gold and 47.09 g/t silver).
AR19-165A intersected one mineralized interval of:
1.8 metres with a copper equivalent grade of 2.97% (1.66% copper, 1.87% zinc, 0.34% lead, 0.52 g/t gold and 18.87 g/t silver).
AR19-166 intersected five mineralized intervals of:
5.1 metres with a copper equivalent grade of 6.70% (2.95% copper, 6.22% zinc, 1.47% lead, 0.75 g/t gold and 51.07 g/t silver);
9.5 metres with a copper equivalent grade of 6.74% (4.12% copper, 4.78% zinc, 0.46% lead, 0.48 g/t gold and 40.61 g/t silver);
1.6 metres with a copper equivalent grade of 7.84% (2.71% copper, 10.13% zinc, 2.02% lead, 0.25 g/t gold and 56.36 g/t silver);
6.5 metres with a copper equivalent grade of 3.22% (1.68% copper, 2.12% zinc, 0.41% lead, 0.47 g/t gold and 35.65 g/t silver); and
8.6 metres with a copper equivalent grade of 7.51% (3.62% copper, 6.81% zinc, 0.84% lead, 0.87 g/t gold and 56.00 g/t silver).
AR19-167 intersected one mineralized interval of:
3.0 metres with a copper equivalent grade of 3.63% (2.40% copper, 2.60% zinc, 0.10% lead, 0.10 g/t gold and 16.92 g/t silver).
AR19-169 intersected one mineralized interval of:
14.4 metres with a copper equivalent grade of 3.70% (2.20% copper, 2.61% zinc, 0.33% lead, 0.30 g/t gold and 24.20 g/t silver).
AR19-170 intersected two mineralized intervals of:
13.7 metres with a copper equivalent grade of 6.24% (3.36% copper, 5.52% zinc, 0.74% lead, 0.33 g/t gold and 39.19 g/t silver); and
7.1 metres with a copper equivalent grade of 7.17% (5.27% copper, 2.57% zinc, 0.02% lead, 0.91 g/t gold and 38.75 g/t silver).
AR19-171 intersected one mineralized interval of:
16.6 metres with a copper equivalent grade of 6.30% (3.69% copper, 4.24% zinc, 0.85% lead, 0.45 g/t gold and 51.14 g/t silver).
AR19-172 intersected one mineralized interval of:
16.1 metres with a copper equivalent grade of 1.71% (1.07% copper, 1.15% zinc, 0.18% lead, 0.10 g/t gold and 9.08 g/t silver).
* Assumptions used for the copper equivalent calculation were metal prices in USD of $2.90/lb copper, $1.10/lb zinc, $0.90/lb lead, $1,250/oz gold, and $18/oz silver. The following equation was used to calculate copper equivalence: CuEq = Copper (%) + (Zinc (%) x 0.379) +(Lead (%) x 0.310) + (Gold (g/t) x 0.629) + (Silver (g/t) x 0.009).
James Gowans, Interim President and CEO of Trilogy Metals commented, "The latest drilling results continue to demonstrate that not only is the Arctic Project one of the highest grade known polymetallic base metal projects in the world, but it is also incredibly consistent along strike and dip regardless of where you drill at the project. We believe there is the possibility of other "Arctic like" deposits being discovered within the 100-kilometer long Ambler Mining District. Further drilling by the Joint Venture is intended to test targets across the UKMP."
At the Arctic Project and as described above, the Company drilled ten holes comprising 2,422 meters of which eight holes were sampled and sent off for assay analysis. Hole AR19-165 was lost due to technical drilling issues and hole AR19-0168 did not intersect base metal mineralization as it tested the south highwall and did not target the mineralized zones. Drilling at Arctic during the 2019 field season was carried out to support mine design and the collection of further geotechnical and hydrological information. The material will be used for additional metallurgical test work in the future.
The VMS-style mineralization at Arctic was discovered by Bear Creek Mining Company in 1965 and is exposed on the east side of the north trending Arctic Ridge. The rock units exposed are typical of the Ambler Schist sequence and include quartz +/- feldspar and chlorite +/- talc schist, graphitic and graphitic quartz schist, and aphanitic and porphyritic meta-rhyolite units. Massive and semi-massive sulphide mineralization, consisting of chalcopyrite, sphalerite, galena, and tetrahedrite/tennantite, occurs in 0.1 metre to 26-metre bands generally at a contact between graphitic and quartz-chlorite +/- talc schist.
Results for the 2019 drill program at Arctic are presented in Table 1 at a cutoff grade of 0.5% copper equivalent. All the intersected widths are close to normal to stratigraphy and therefore can be considered to be true widths. Table 2 shows the drill hole locations. Figure 1 shows the location of the drill holes on a plan map and Figure 2 shows a cross-section through drill holes AR19-0164, and AR19-0166. Figure 3 shows a cross-section through drill holes AR19-0169, AR19-0170 and AR19-0171.
Table 1 - 0.5% Cu Eq cut-off* with maximum 3 m internal waste – Minimum 1.5 m interval
0.5% CuEq
From (m)
To (m)
Length (m)
Cu (%)
Zn (%)
Pb (%)
Au (g/t)
Ag (g/t)
CuEq (%)*
AR19-0164
148.77
154.54
5.77
1.45
6.24
0.83
0.28
32.20
4.54
161.27
177.68
16.41
5.09
4.82
0.53
0.47
47.09
7.80
AR19-0165A
125.11
126.95
1.84
1.66
1.87
0.34
0.52
18.87
2.97
AR19-0166
155.36
160.51
5.15
2.95
6.22
1.47
0.75
51.07
6.70
170.18
179.65
9.47
4.12
4.78
0.46
0.48
40.61
6.74
182.73
184.35
1.62
2.71
10.13
2.02
0.25
56.36
7.84
194.62
201.15
6.53
1.68
2.12
0.41
0.47
35.65
3.22
209.53
218.16
8.63
3.62
6.81
0.84
0.87
56.00
7.51
AR19-0167
197.21
200.25
3.04
2.40
2.60
0.10
0.10
16.92
3.63
AR19-0169
127.92
142.34
14.42
2.20
2.61
0.33
0.30
24.20
3.70
AR19-0170
137.77
151.49
13.72
3.36
5.52
0.74
0.33
39.19
6.24
253.33
260.43
7.10
5.27
2.57
0.02
0.91
38.75
7.17
AR19-0171
50.87
67.42
16.55
3.69
4.24
0.85
0.45
51.14
6.30
AR19-0172
178.49
194.54
16.05
1.07
1.15
0.18
0.10
9.08
1.71
* Assumptions used in USD for the copper equivalent calculation were metal prices of $2.90/lb copper, $1.10/lb zinc, $0.90/lb lead, $1,250/oz gold, and $18/oz silver. The following equation was used to calculate copper equivalence: CuEq = Copper (%) + (Zinc (%) x 0.379) +(Lead (%) x 0.310) + (Gold (g/t) x 0.629) + (Silver (g/t) x 0.009).
Table 2 – Arctic Drill Hole Locations
Hole
East (m)
North (m)
Elevation (m)
Azimuth
Dip
Length (m)
AR19-0164
613111
7452991
825
80
-80
182
AR19-0165A
613182
7453348
911
315
-65
222
AR19-0166
613111
7452991
825
0
-90
300
AR19-0167
613341
7453448
986
45
-65
271
AR19-0169
613335
7452909
915
100
-85
200
AR19-0170
613335
7452910
914
0
-90
351
AR19-0171
613508
7452944
947
120
-65
282
AR19-0172
613341
7453448
986
0
-90
240
Figure 1- Map Showing Location of 2019 Drilling Program at Arctic (CNW Group/Trilogy Metals Inc.)
Figure 2 – Cross Section of Arctic Drilling Showing Assay Results (CNW Group/Trilogy Metals Inc.)
Figure 3 – Cross Section of Arctic Drilling Showing Assay Results (CNW Group/Trilogy Metals Inc.)
QA/QC Program
The drill program, sampling protocol, and data verification were managed by qualified persons employed by the Company. Diamond drill holes were typically collared and drilled to depth HQ for the Arctic holes, except for holes AR19-0166 and AR19-170, which were collared PQ. Samples were collected using a 0.13-metre minimum length, a 2.5-metre maximum length and a 1.36-metre average sample length. Drill core recovery averaged 97% for Arctic core. Three quality control samples (one blank, one standard and one duplicate) were inserted into each batch of 20 samples. The drill core was sawn, with half sent to ALS Minerals in Fairbanks for sample preparation and the sample pulps forwarded to ALS's North Vancouver facility for analysis. ALS Minerals is an independent facility certified as ISO 9001:2008 and accredited to ISO / IEC 17025:2005 from the Standards Council of Canada. The assay and QA/QC results were reviewed by a third-party consultant, GeoSpark Consulting Inc. of Nanaimo, British Columbia, and in their opinion shows overall good quality for silver, copper, lead, and gold analyses. The Company submitted 5% of the mineralized assay intervals to an independent check assay lab.
