Our flagship property, Golden Hills, is comprised of 7,500 sq. km in western Mongolia.  At the Golden Hills property, QGX has discovered three types of mineralization occurring over a strike length of 2.4 km.  Since 2002, over 100 drill holes have been completed at CVZ, and drilling is actively ongoing today.

The three main types of mineralization discovered at CVZ are:

• copper-gold-silver in massive sulphides,
• gold-silver in gossan (oxides); and
• high-grade gold-silver in quartz-telluride veins.

Copper-Gold -Silver Massive Sulphide
Mineralization is hosted within a sequence of felsic to intermediate metavolcanic and metavolcaniclastic rocks belonging to the Proterozoic Shuvuun Formation.  A large massive sulphide body located within the Central Valley Zone is interpreted as a volcanogenic massive sulphide-style deposit (VMS), with a hydrothermal feeder zone beneath the massive sulphide. Hydrothermal alteration related to the VMS event is extensive and can be traced for several kilometers along strike. The host sequence has been metamorphosed, deformed, and intruded by numerous metamafic dykes and a syenite pluton.

Primary copper-gold-silver mineralization occurs over widths of up to 60 m within the massive sulphide body.  Supergene copper enrichment of the massive sulphide locally occurs near the top of the body at the base of oxidation, yielding copper grades as high as 27 percent over a width of 3.2 m. 

There are three distinct zones of massive sulphide, called the North, Central and South Zones.  Copper has been found in both the North and South zones.  The South Zone occurs approximately 300 m south of the North zone. 

Surface expression of mineralization at CVZ.

The North Zone massive sulphide has been drilled over a strike length of 600 m.  The mineralized zone dips approximately 55 degrees to the north, varies in thickness from 10-63m (based on 0.8% Cu cut off) and occurs from 70 m below surface to a depth of 350 m (see section below). 

In the South Zone, occurring 300 m south of the North Zone, a high-grade section (Zone 65) has been identified which contains a series of Cu-Au intercepts associated with schist and semi-massive to massive pyrite.  The best drill intercept in the South Zone included 33.5 m of 7.4% Cu and 32.5 m of 13.8 g/t Au and 10.8 g/t Ag (see release of April 6, 2004).

Section 10,400E showing massive sulphide (dark orange) and Cu bearing massive sulphide (light orange).

Click here to view the Section 10,4000E illustration larger.

Core from DH-43 showing chalcopyrite in massive sulphide.

Summary table of significant MS intercepts at CVZ.

Gold-Silver Gossan (Oxide)

Weathering of the massive sulphide bodies down to a depth of 70 m formed the gold-silver gossan (oxide) bodies in the CVZ at Golden Hills.  Mineralized gossan locally subcrops and extends to a depth of approximately 70 m below surface.  The gossan bodies extend laterally for at least one km along strike.

Independent metallurgical testing of the gossan has demonstrated that the ore may be amenable to a low-cost, run-of-mine, heap-leach operation.

Photo of Gossan core

Summary table of significant gossan intercepts at CVZ

Gold-Silver Quartz-Telluride Veins
Drilling has identified a potentially economic underground gold-silver resource within quartz-telluride veins at CVZ.  Tellurium (Te), a silvery-white metallic element, is a common constituent of these high-grade gold and silver veins.  These veins typically occur proximal to the North Zone massive sulphide bodies, shown in the section below. Click here to view the Section 10,5000E illustration larger.

Section 10,500E showing quartz-telluride veins (red stripes).

As of October 2004, more than 30 high-grade quartz-telluride intercepts have been returned over a strike length of 600 m.  Based on a 12 g/t x meter cut off, QGX has demonstrated an average weighted grade of 18.0 g/t Au and 22.7 g/t Ag over an average weighted width of 4.0 meters (see Oct. 14/04 press release for results).

Photo of Quartz-Telluride Vein Core

Summary of High-Grade Quartz-Telluride Au-Ag Vein intercepts at CVZ.

• Au interval based on 12.0 g/t Au x meter cut off.
• Avg. intercept width = 3.99 m; Weighted avg. Au intercept = 17.99 g/t Au, 22.7 g/t Ag, excluding intervals with pending assays.

Hydrothermal alteration similar to CVZ occurs up to 20 km to the east of the CVZ.  QGX is planning to explore this region during the 2005 field season.

QGX can earn an 80% interest in the Golden Hills prospect by expending US$450,000 on the property by 2005. QGX can also increase its interest to 100% by making a payment of US$1,000,000 after completion of the earn-in.

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