Source: The Australian Journal of Mining            Date: 15 June, 2011

Voyager Resources began trading on the ASX in 2009, the company emerging from Philippines-focused miner Lafayette Mining which went into voluntary administration at the end of 2007. Its focus was initially on Gabon in Africa, but the global explorer re-set its sights on Mongolia, with managing director Kell Nielsen spending 18 months searching for prospective projects. His efforts spanned a time when Mongolia went from being a relative backwater to one of the premier exploration locations. They bore fruit with the acquisition of the Khongor copper gold project in December 2010.

“We got in early at a time when there weren’t too many expats flying in and out,” he said. “This year during winter the planes and restaurants were full. It really is a changing country.” While much of the present buzz surrounds the Mongolian Government’s auction of the giant Tavan Tolgoi coal resource, which has attracted huge interest from miners, trading houses and banks, it is Ivanhoe Mines and Rio Tinto’s vast Oyu Tolgoi copper gold project which has done most to put Mongolia on the mining map.

Kell Nielsen and Voyager are keen to play up similarities between Khongor and Oyu Tolgoi. Both are located in the South Gobi Arc Terrain which has spawned many huge deposits across the region, with Khongor 250 km to the west of Oyu Tolgoi. “I see Khongor as an early stage project similar to what BHP would have had when it exited Oyu Tolgoi,” said Nielsen.

BHP, through its Magma Copper acquisition, performed early and promising exploration drilling on Oyu Tolgoi. However, before the Big Australian could fully exploit Oyu Tolgoi’s potential, financial pressures and a consequent slashing of exploration budgets saw it offload the project to Canada’s Ivanhoe Mines in 1999. It was only in 2001 that Oyu Tolgoi’s potential was revealed when Ivanhoe began to drill far more deeply than before. The breakthrough came with Hole OTD-150, drilled to a depth of 590 meters. It averaged in excess of one gram of gold per ton and 0.81% copper over a distance of 508 meters, from 70 meters to 578 meters.

Nielsen believes that it’s deep drilling that will reveal Khongor’s potential. “The top 188 m of that hole was all 0.5% and 0.6% copper; it wasn’t until they got below 188 meters that they started intercepting porphyry stock within that system and then their copper grades went up. That’s where we think that we sit at the moment,” said Nielsen.

Khongor’s drilling results from 2005 onward, under the project’s previous owner, whose identity Voyager wouldn’t disclose, included fairly broad porphyry mineralization with one hole returning 50 meters @ 1.0% copper and 0.3 g/t gold from 64 meters and another 70.3 meters at 0.7% copper and 0.2 g/t gold from surface. Plans are in hand to progress exploration with an April placement raising AUD4.1 million and a rights issue expected to bring in another AUD6.3 million. Funds are earmarked for deep IP work and commencement of more drilling. Voyager has a target of 100 to 200 million tons at 0.7% to 1.0% copper.

While Nielsen is cryptic on details of the acquisition of Khongor, he said that it was “a complex agreement” involving a number of parties. “We own it 100%. This is our main project. We went to Mongolia to acquire a project like this and spent two years looking. We started negotiations in Mongolia when we were pretty much one of the only Australian groups. There’s a big rush on now. There’s news coming out now that people are looking for projects in Mongolia – not acquired – but looking!”

Kell Nielsen is a geologist with 20 years’ experience. Other directors at Voyager include Nicholas Lindsay, Matthew Wood (chairman), Tim Flavel and George Tumur, the latter being a well experienced local who is acting as operations director.