Arc Exploration picks up NSW gold projects

THE BOURSE WHISPERER: Arc Exploration (ASX: ARX) has signed Option to Farm-in Term Sheets on two gold projects in New South Wales, Australia.

The projects are located in the Junee and Oberon districts and are held 100 per cent under exploration licences by non-listed company New South Resources (NSR).

The two projects are situated in the Lachlan Orogen, which Arc described as being, “a complex geological province endowed with world-class gold and gold-copper deposits.”
 

The Junee project comprises three exploration licences covering about 70 square kilometres along a belt of productive Ordovician volcanic rocks that contains several different styles of major gold deposits.

 

Location plan showing new project areas. Source: Company announcement

 

This project contains an advanced gold target, Dobroyde, which is a high-sulphidation epithermal gold system discovered by Getty Oil in the early 1980’s.

The Oberon project consists of one exploration licence covering 254sqkm across belts of Siluro-Devonian and Ordovician volcanic rocks.

This project contains an advanced gold target, Murphys, which is a VMS-related quartz-stockwork gold system discovered by Newmont Mining in the late 1970’s.

Arc explained information it has been supplied by NSR indicates the two advanced gold targets each contain a modest -sized, low-grade gold resource.

These will be assessed further during the due diligence process.

“We have been looking for new project opportunities in eastern Australia for some time and have reviewed numerous possibilities,” Arc Exploration managing director John Carlile said in the company’s announcement to the Australian Securities Exchange.

“Our search has targeted accessible projects that contain at least one advanced gold prospect together with additional exploration upside for further discoveries in a productive mineral province.

“NSR’s Junee and Oberon projects meet these criteria.

“Moving into these projects offers ARX the opportunity to establish a firm foothold in a major gold and copper producing province that has excellent potential for further discoveries and growth.

“We see this as a major step forward for ARX and look forward to progressing our due diligence over the next few months.

“In the meantime, our two Indonesian projects, Trenggalek in East Java and the Alliance in Papua, are being funded by our joint venture partner Anglo American.

“ARX remains in a sound financial position with cash of around $3.5 million and no debt”.

Key commercial terms of the deal are:

Subject to a 90 day exclusive due diligence period ARX may enter a 1 year Option Period on one or both projects for a minimum expenditure of $100,000 on Junee and $135,000 on Oberon;

ARX may then earn a 51 per cent interest, in one or both projects, by sole funding $500,000 within two years on each project it elects to progress; and

ARX may then earn up to an 80 per cent interest, in one or both projects, by sole funding a further $580,000 within a further one year on each project it elects to progress.