RESULTS for the final three holes of the 2015 exploration drilling campaign at Highlands Pacific’s Star Mountains project have confirmed copper gold mineralisation and identified extensions of the mineralised zones at the two prospects.

The final two Olgal holes also encountered broad zones of medium grade porphyry style mineralisation beyond the previous north west and south eastern limits of the known zones, Highlands said.

Highlands managing director John Gooding was pleased with the results of the drilling campaign, which saw nine holes drilled for a total of 5,387 metres.

“At Star Mountains, the drilling results released in the March quarter provided further evidence of extensive mineralisation in our tenements and work is continuing to assist in identifying further targets for further drilling over the next 12 to 18 months,” he said.

Since the beginning of 2016, additional exploration has been carried out, including a Z‐Tipper Axis Electromagnetic (ZTEM) airborne electrical resistivity survey conducted by helicopter and completed during the March quarter.

Highlands said results from the survey, which was flown over more than 3,300 line kilometres, would assist in identifying additional exploration targets in the western region of the tenements.

Extensive field work at Star Mountains continued during the March quarter, including tenement mapping, rock chip and soil sampling, as well as stream sediment sampling.

The death of a worker at the company’s Ramu nickel cobalt mine near Madang in April has seen operations suspended while an investigation into the accident continues.

Highlands said the plant shut down will affect nickel production in the current year but the extent of the impact will be unknown until operations resume.

In the March quarter Ramu nickel metal in concentrate production totalled 7,074 tonnes, up 12 per cent on the prior December quarter.

Increased production was due to consistent improvements in plant throughput following a maintenance shutdown in November 2015, and as the process plant continues to ramp up towards full capacity, the company said.

Cobalt metal in concentrate production increased 11% to 694 tonnes, which Highlands said is the second highest output on record.

Depressed nickel prices continue to have a negative impact on the financial performance of the Ramu operation, Highlands said.

Project net cash outflow was US$2.1 million for the March quarter, after capital expenditure of US$1.6 million.

Cash outflow is being funded by Ramu joint venture partner Metallurgical Corporation of China (MCC).

Discussions are continuing with exploration partner Sojitz with regards to a further exploration campaign at the company’s Sewa Bay project, located in the Milne Bay province.

This follows the release of encouraging results from drilling carried out in 2015, which confirmed extensive nickel mineralisation, Highlands said.

At the end of the March quarter, Highlands reported cash at bank of US$13.5 million; this is following receipt of US$5 million from Anglo American for acquisition of its interest in the Star Mountains project.