Cassini bags BHP bundle

THE INSIDE STORY: Junior exploration play Cassini Resources (ASX: CZI) recently caused a minor tremor on the boards of the Australian Securities Exchange.

The excitement followed the company’s announcement it had executed a Sale and Purchase Agreement to acquire 100 per cent of the West Musgrave project in Western Australia.

While the acquisition of such a project by a junior company is fairly common, what cast this particular deal into the spotlight was the identity of the vendor.

Cassini secured the property from BHP Billiton Nickel West and BHP Billiton Minerals, two subsidiaries of global mining powerhouse BHP Billiton (ASX: BHP).

The West Musgrave project contains the Nebo and Babel sister deposits, commonly referred to as Nebo‐Babel, the Succoth copper exploration prospect plus a number of prospective exploration targets.


The crucial element of the deal for Cassini is all these deposits and targets come under the company’s control with a great deal of exploration and development work already completed.

Nebo‐Babel, the project’s pivotal prospect, was first discovered by Western Mining Corporation (WMC) in 2000, when drilling intersected mineralisation of 26.55 metres at 2.45 per cent nickel, 1.78 per cent copper, 0.74 grams per tonne platinum group elements (PGE) plus gold.

BHP arrived on the scene by swallowing up WMC in 2005, after which time Nebo‐Babel was subjected to a healthy amount of exploration activity, which mainly focused on developing the deposits as a large‐scale, low‐grade production model.

Nebo‐Babel currently has an Inferred resource 446 million tonnes at 0.33 per cent nickel and 0.35 per cent copper (0.2 per cent nickel cut‐off) for 1.47 million tonnes of contained nickel and 1.56 million tonnes of contained copper.

“Because of the way BHP originally approached the project, the high-grade ore body within the deposits was never really domained,” Cassini Resources managing director Richard Bevan told The Resources Roadhouse.

“They intended it to become a large large‐scale, low‐grade production model.

“We intend looking at the project differently, as a high-grade opportunity – as a smaller project than what BHP originally envisaged.

 “So we have some work to do over the next six to twelve months to really get in there and define that high-grade ore body.”

Cassini is confident Nebo‐Babel has the characteristics necessary for it to become a smaller, higher‐grade operation.

This confidence stems from the results of the due diligence the company carried out over the deposit, which revealed its substantial production potential.

Cassini’s due diligence demonstrated the existence of discrete higher‐grade zones within the Nebo‐Babel deposit, which have yet to be fully delineated by drilling.

Both deposits are suitable for openpit co‐development as they are very close to the surface, with the Babel deposit outcropping.

Nebo‐Babel also revealed favourable ore‐body geometry as a flat dipping deposit, which Cassini considers shows potential for an openpit operation with a very low stripping ratio.

Another vital aspect of the acquisition is the reasonably small consideration of $250,000, ten per cent of which has already been paid by Cassini as a deposit.

BHP will be paid a two per cent net smelter royalty, which will apply to the net proceeds from future production from the tenements within the project.

Cassini will also pay a production milestone payment due 12 months after production from the project commences, amounting to $10million in cash.

Cassini considers such a minimal up-front cost de‐risks the project considerably and allows it to focus on assessing future development options.

“It is better than drilling the discovery hole in many ways,” Bevan said.

“BHP has spent a significant amount of money on the deposit to bring it to where it is now, which means we don’t have to.

“For us that means we are moved a considerable way along – a lot of the risk is gone – in the sense that we are not out there trying to find something – it’s already been found.

“For the cost of a drill program [the $250,000 consideration] we have got a project with high-probability for an economic deposit.

“However, there are a couple of things we need to do in order to confirm that is the case.”


Using what it has learned from the extensive work already undertaken on the project, and the $10 million proceeds from a subsequent share placement, Cassini proposes carrying out resource definition drilling to infill known higher‐grade zones to build a higher‐grade subset to the overall Nebo ‐ Babel Mineral Resource.

It will also conduct metallurgical testing to ensure it can achieve acceptable recoveries within higher‐grade ore at Nebo‐Babel.

“BHP has already conducted a fair bit of metallurgy testing,” Bevan explained.

“However, they approached that in a similar way to which they approached the project itself – by taking bulk composite samples.

“They didn’t actually look at the recoveries for the higher grade, or the recovery for the different types of ore present.

“That’s the work that needs to be done. That’s the opportunity for us – to approach it as a junior company would – and within that greater project area is a smaller valuable subset.”

Cassini’s acquisition of the West Musgrave project demonstrates that, even though the market may currently be experiencing some tough times, when a junior mining company is prepared to take a chance it can still be handsomely rewarded.

The overnight success of the deal started some 18 months ago when Cassini boldly approached BHP to gauge whether it may be interested in divesting the projects. As it turned out BHP was interested.

There was also a great deal of interest in the projects from a number of Cassini’s contemporaries in the junior sphere, all of which were just as eager to augment their own projects in the West Musgrave region.

“One of the criteria BHP had was that the project would go to a company with existing relationships in the area and would develop the project so the communities in the region would actually see some benefit from the project,” Bevan said.
“Fortunately we have worked hard developing an existing relationship with the communities and the traditional owners in the region.”

Another differentiating factor that shouldn’t be overlooked is the personnel who sit around Cassini’s Boardroom table.

The company’s chairman Mike Young with his exploration to production experience with BC Iron, demonstrates the ability to take an asset and bring it through to production in a reasonably short time frame.

John Hronsky has been consulting to Cassini through his consulting group Western Mining Services and was previously with BHP Billiton Minerals Exploration and WMC Resources.

He was a key member of the targeting strategy and exploration team that led to the discovery of Nebo‐ Babel, which does qualify him to be a very handy man for Cassini to have on its team at this time.

“We consider the West Musgrave project to be a truly significant set of assets, and being able to acquire them is a great result for Cassini,” Bevan said.

“Nebo‐Babel is widely regarded as a world‐class deposit and, as a smaller company, we look forward to applying a different, innovative approach to these assets, focussing on higher‐grade opportunities, with the aim of progressing their development to production as a priority.

“We are confident we can hit a number of major project milestones within the next six to twelve months.”

Cassini Resources Limited (CZI)
…The Short Story

945 Wellington Street
West Perth WA 6005

Phone: +61 8 9322 7600
Fax: + 61 8 9322 7602


Mike Young, Richard Bevan, David Johnson, Dr Jon Hronsky, Phil Warren, Greg Miles

Directors         12.2%
Cornela Pty Ltd     5.5%

Top 40        49.6%


Sheffield Resources fires up Thunderbird

THE INSIDE STORY: Minerals sands developer Sheffield Resources (ASX: SFX) recently reached a major milestone for a junior mining play, as the company’s market cap hurdled over the $100 million mark.

The rise in Sheffield’s share price flowed on the back of results from a Scoping Study conducted on the company’s 100 per cent-owned Thunderbird deposit, located near Derby in northwest Western Australia.


“It seems we released the results at just the right time and we are hoping that run continues to enable us to catch the forecast upswing in mineral sands commodity prices,” Sheffield Resources managing director Bruce McQuitty told The Resources Roadhouse.

“There was a boom in mineral sands prices in 2011, which has come off to what appears to be a floor level, with many analysts now forecasting improved demand and subsequently improved prices.”

The Scoping Study has determined Thunderbird to be a world-class, long life mineral sands project, which is anticipated to provide exceptional financial returns with modest capital requirements.

The Study results and subsequent share price movement are important milestones for Sheffield as it demonstrates the market’s recognition and appreciation of the significance of the Thunderbird project to the Australian minerals sands industry.

“We consider Thunderbird to be a company making project,” McQuitty said.

“It has shown itself to be so since the early days, and everything we have achieved there so far has done little to change our thinking.”

What Sheffield has achieved so far at Thunderbird has shown just because such a project is being developed by a junior mining company doesn’t mean it can’t be of significance on a global scale.

The company acquired Thunderbird as part of the Dampier project in late 2010 after Rio Tinto (ASX: RIO) had let ownership of the title slip due to difficulties associated with the GFC.

“At the time our technical director David Archer recognised the project’s potential and put an exploration target on it based on the Rio drilling, which consisted of just eight holes,” McQuitty said.

“He estimated an exploration target of between 450 to 850 million tonnes at five to ten per cent Heavy Minerals.”

Sheffield raised $10 million on the back of that target, which it has since put to good work.

The release of the Scoping Study followed a Resource upgrade completed earlier this year, when Sheffield doubled the Resource at Thunderbird, placing a lot more in the Indicated category.

The Resource at Thunderbird now sits at 2.62 billion tonnes at 6.5 per cent heavy minerals (HM) (Measured, Indicated and Inferred) for 170Mt of contained HM, including a high-grade component of 740Mt at 12.1 per cent HM.

The Scoping Study concluded projected and estimated production and financial parameters for the Thunderbird deposit to include:

An initial mine life of 32 years, targeting first production in 2017;

Life of mine (LOM) revenue of $10 billion;

LOM operating cash flow of $5 billion ($204 million per annum for first 10 years of production);

Average LOM annual EBITDA of $140 million ($187 million per annum for first 10 years of production);

Pre-production capital expenditure of $257 million plus $37 million of contingency, with identified opportunities that may reduce capital expenditure with capital payback in two years; and

Average annual production of 118,200 tonnes zircon, 545,000 tonnes ilmenite, and 21,700 tonnes of HiTi80 leucoxene.

Notably the Study has only incorporated Thunderbird’s Indicated and Measured Mineral Resources.

The high-grade Inferred segment of the Resources remains open in several directions and provides Thunderbird with a healthy amount of upside potential.

Sheffield has commenced pre-feasibility studies with completion anticipated Q1 2015, which according to a research note from Hartleys has potential to improve on the strong economics outlined by the Scoping Study.

The potential improvements identified by Hartleys include: A reduction in the start-up capital expenditure; reducing operating expenses; and increasing the current 32 year mine life.

“There is a lot of work associated with the pre-feasibility and feasibility stages such as groundwater, geotechnical, and infrastructure studies along with further metallurgical work to enhance our recovery rates and the associated process design,” McQuitty explained.

“We also anticipate undertaking a lot more drilling during the upcoming field season as we work towards moving more of the current Resource into the Measured category in the up-dip region where we plan to commence mining.

“There is more exploration to be done, simply because we have yet to fully close off the deposit, so there is a lot more drilling to do and a lot more news to come.

“The Scoping Study was quite thorough and some aspects are already at a pre-feasibility level, such as the process design and the metallurgical work.

“Other aspects of the Scoping Study, of course, were more educated assumptions, based on analogies with other projects – so we need to balance those up for the pre-feasibility study to ensure we have – not definitive data – but, more refined data.”

The Scoping Study has demonstrated Thunderbird is a global-scale deposit with potential to generate consistently strong cash margins from globally significant levels of production of ilmentie and zircon over a 32 year mine life.

The real excitement, however, is generated from the project’s current modelled production rates, from which Thunderbird is expected to supply approximately eight per cent and four per cent of the global zircon and ilmenite markets respectively.

Zircon is a high-value commodity. With the current zircon price around US$1200 per tonne.

Ilmenite is a staple feedstock of smelters, which enjoys a particularly higher demand from Chinese sulphate plants.

One major positive aspect of ilmenite is that even when markets tighten, demand for it doesn’t dissipate, whereas the market for the higher value, high-titanium feedstocks such as rutile, or synthetic rutile, does dry up.

Most of the major deposits around the world, in Africa and Sri Lanka, tend to be high in titanium minerals but not so high in zircon while others may be high in zircon, but not in titanium minerals.

The contained zircon in the total Resource at Thunderbird is more than any other deposit around the world at the present time.

The key to the project is its ‘high-grade zone’.

Modelling of the Thunderbird deposit resembles a layered sponge cake with the high-grade zircon and ilmenite zone being the jam and cream sitting in the middle as a coherent high-grade layer just below surface.


“This high-grade zone we are focussing on at Thunderbird has one of the highest grades, both in terms of zircon and titanium minerals of any deposit globally,” McQuitty said.

“We have a good balance at Thunderbird in terms of the mineral commodities represented.

“The bulk of the value within the Thunderbird deposit is tied up in the levels of zircon present, which account for some fifty per cent of the revenues defined in the Scoping Study, with around forty per cent coming from the ilmenite.

“Mineral sands is a bit of a blank box for many people and as such are something of an unknown quantity for many market watchers.

“We are very happy to finalise the Scoping Study and get the results out as we feel they fully explain the value of the high grades encompassed in the deposit in both dollar and production terms.”

Sheffield Resources Limited (ASX: SFX)
…The Short Story

Level 1, 57 Havelock Street
West Perth WA 6005

Ph: + 61 8 6424 8440
Fax:   +61 8 9321 1710


Will Burbury, Bruce McQuitty, David Archer

Will Burbury            6.4%
Bruce McQuitty        6.4%
David Archer        6.4%

approx. 119.6 million


$117.79 million (at 24/4/14)



Savannah discovery widens Panoramic’s outlook

THE INSIDE STORY: Panoramic Resources (ASX: PAN) has discovered a new zone of nickel mineralisation, which could significantly extended the current mine life of Savannah.

Nickel enjoyed a buoyant beginning to 2014, thanks to the Indonesian Government’s ban on the export of nickel laterite ores.

Before the ban Indonesia was the world’s biggest exporter of nickel and the main supplier of low-grade nickel laterite ores to China’s nickel pig iron industry.

“I don’t want to comment on Indonesian politics but I do understand the rationale for the decision they have made,” Panoramic Resources Managing Director Peter Harold told The Resources Roadhouse.

“I will, however, say we are very happy to see the impact that decision is having.

“Combined with the weaker currency there has been a significant improvement, in Australian dollar terms, in the nickel price.

“That means we are making good money now from our existing operations as our margins have recovered.”

Panoramic Resources operates two 100%-owned underground nickel sulphide mines in Western Australia, the Savannah project in East Kimberley and the Lanfranchi project near Kambalda.
The company produced 19,561 tonnes of contained nickel in FY2013 and recently increased its guidance, forecasting to produce between 21,500 and 22,000 tonnes in FY2014.

One troubling aspect of any mine is that every tonne of ore produced moves it closer to the end of its life.

Panoramic could have recently discovered the elixir of mine life in the form of the Savannah North mineralised zone.

Drill hole KUD1525 was the first of a new drill program Panoramic designed to explore for the faulted continuation of the Savannah Intrusion to the north of the existing mine.

As far as first holes go, it couldn’t have been better with initial results returning assays of:

89.3 metres at 1.6% nickel, 0.76% copper, 0.12% cobalt from 704.9 metres, including:

13.2m at 2.1% nickel, 0.72% copper, 0.15% cobalt from 741.8m; and

17m at 2.28% nickel, 1.16% copper, 0.17% cobalt from 777m.


“The Savannah story is very much now about maintaining record production levels, keeping costs down, the recent discovery at Savannah North and its potential in regards to our ability to increase reserves and extend mine life, given that we are now down to three years based on the current reserve,” Harold said.

“First and foremost Savannah North is a wonderful discovery by our geological team, led by John Hicks, who had the foresight and the knowledge to look in that area.

“He really had nothing more than a blank sheet of paper, yet was able to develop a theory of the potential existence of a fold, which if correct would mean the orebody could continue to the north.

“He wasn’t basing his assumptions on any particular EM targets, aeromagnetic surveys or such; it was based purely on his intimate knowledge of the ore body above the 900 fault, the drilling below the 900 Fault and what may have happened as a result of a geological event.

“It was really good geological detective work to anticipate a possible continuation in what was a totally untested area.”

The Savannah North discovery has to be one of the better examples in recent times of the courage and faith required for successful exploration.

Courage initially from Hicks to approach the Board with what he considered to be the best option for him to follow; faith displayed by the company in Hicks’ knowledge of the geology to support his assumptions; and both by very supportive brokers, a significant new investor in Zeta Resources and the marketplace, which rallied to raise the money giving Panoramic the confidence to carry out an aggressive exploration program.

“We raised $15 million, in a very tough market, for nickel exploration,” Harold said.

Subsequent to the discovery, KUD1525 intersected a second zone of mineralisation of: 8.7m at 1.23% nickel, 0.87% copper and 0.09% cobalt from 882.5m, which was interpreted to be mineralisation caught up within the 900 Fault zone, lying below the Savannah North discovery.

“We are definitely onto something and down-hole EM surveying of KUD1525 identified targets to follow-up, which has provided much confidence as well as the impetus to get in there and do some serious drilling,” Harold said.

“We have one underground rig and two surface rigs drilling focusing on the area where that EM target was identified and where we encountered mineralisation previously, to test the entire structure in order to determine just how big it may be.

“The sooner we convert all that drilling into Resources and Reserves the sooner we can start thinking about mine life extension.”

With everything happening at Savannah, it would be easy to presume Panoramic was concentrating all of its efforts there.

However, there is still a lot of action at the Lanfranchi project where a number of prospective targets have been identified.
“From the $15 million we raised last year we determined to spend as much as possible on nickel exploration at both sites,” Harold said.

“We budgeted an equal amount of money at Lanfranchi with the intention of extending existing ore bodies, potentially identifying a new mineralised channels.

“There’s been no major discoveries yet, but we are confident, as we know the Kambalda Field has a track record of producing a lot of ore.”


Panoramic’s diversity extends beyond the two nickel mines it operates to incorporate other commodities.

The Gidgee gold project near Wiluna in WA, includes the high-grade Wilsons project, while the company also holds a 70% interest in the Mt Henry gold project near Norseman.

“We are in the process of finishing off Feasibility Studies on both these project, both of which we anticipate being completed by around June this year,” Harold said.

“We are keen to get those finished to get a good idea of how those projects look in 2014 dollars from a capital and operating cost perspective.

“We expect one of those projects to look better than the other one in terms of risk and ecomonics i.e. free cash, NPV, and internal rate of return.

“The better project will get front running on development, then the rest is up to the gold price.

“Ultimately we will make decisions on our gold projects that provides the best return for our shareholders.”

Panoramic has also expanded into Platinum Group Metals (PGMs) having purchased the Panton PGM project near the Savannah project and the Thunder Bay North PGM project in Northern Ontario, Canada.

The company has a bullish outlook for platinum and palladium prices in the medium term and is keeping a close eye on South Africa as far as production is concerned given there was a ten% drop in production there of platinum and palladium last year and rumours of Russia’s stockpile of palladium coming to an end.

“PGM demand is growing strongly mostly for catalytic converters in cars and with the car market growing rapidly in Southeast Asia, and recovering American market and Europe this bodes well for PGM demand,” Harold said.

“There seems to be a potential supply and demand imbalance developing with many analysts forecasting higher platinum and palladium prices.

“Our view is that we have a reasonably cheap option on platinum and palladium with our two assets, and like our gold assets, we’re happy to wait and take advantage of improved prices in the future.

Panoramic Resources Limited (ASX: PAN)
…The Short Story

Level 9
553 Hay Street
Perth   WA   6000

Ph: +61 8 6266 8600
Fax:   +61 8 9421 1008


Brian Phillips, Peter Harold, Christopher Langdon, John Rowe

M&G Investment Ltd 10.7%
HSBC Nominees 12.9%
JPM Nominees 12.6%
Zeta Resources 10.7%

322.27 million

$143.4 million (at 3/4/14)

New Mining Leases permit swift development

THE INSIDE STORY: Brazil-focused gold exploration play Orinoco Gold (ASX: OGX) is poised to become a developer much quicker than it, or the market, anticipated.

Taking the company into the development stage is a recent deal struck with Troy Resources (ASX: TRY) to acquire Mining Leases encompassing the Sertão gold mine in central Brazil.


“The Sertão gold mine is an important piece of the development puzzle for us, which really only works because of what we have already got,” Orinoco Gold managing director Mark Papendieck told The Resources Roadhouse.

Orinoco already has its 194 square kilometre Faina goldfields project in the Faina Greenstone belt, located in the central Brazilian state of Goiás, centred on the large, high-grade Cascavel system.

The Faina Greenstone belt is located approximately 100 kilometres southwest of AngloGold’s Serra Grande mine and Yamana Gold’s Pilar mine.

Troy Resources successfully operated the Sertão mine, producing over 250,000 ounces of gold at 25 grams per tonne.

Since acquiring Cascavel in September 2012, Orinoco has completed a swathe of exploration work including high-grade drilling, channel sampling and bulk sampling.

This work quickly identified a gold-bearing structure at Cascavel, covering an area of 1,600 metres by 700 metres which remains open along strike and down dip with three mineralised zones ranging in width from 2m to 25m.

Drilling also resulted in the discovery of the Tinteiro polymetallic target with the discovery hole returning:

17.56m at 1,292.4 grams per tonne silver, 11m at 0.25 per cent copper, 16.41m at 1,400g/t tungsten from 101m.
A subsequent follow-up drill program encountered:

4.38m at 760.27g/t silver, including 1.05m at 2,510g/t silver from 156.95m.

The company is concentrating on a two-pronged strategy as it progresses towards establishing a mining camp in the region.

The first part of this strategy is focused on achieving short-term production from the high-grade Cascavel and Sertão projects.

Orinoco anticipates utilising the cash flow it generates to continue growing these mines and further exploration at its large Tinteiro project.

“Short term production from our high-grade assets is first on the agenda,” Papendieck said.

“We can then use the cash flow they generate, instead of having to tap the market, to grow our assets because we believe mines are built, not discovered.

“We believe, the style of deposits we have, including the Sertão project we have acquired from Troy Resources, are perfect for growth in this manner.

“We think we can get them off the ground for a very low amount of capex and then continue expanding the mine from there.”

The second part of the Orinoco strategy involves exploring large-scale, long-life mine assets, which is where its Tinteiro project comes into play.

Tinteiro is situated very close to Cascavel, but is different in that it is a very big IOCG target where Orinoco has already defined around seven kilometres of strike, along which it encountered the high-grade silver hits mentioned above.

“Our strategy is reasonably simple,” Papendieck said.

“One: generate cash flow from high-grade assets in the short term.

“Two: use that cash flow to grow the production profile of those assets at Faina and to explore for large-scale, long-life assets, like Tinteiro.”


Obviously the purchase of the Sertão project slips in as a perfect fit for the first part of Orinoco’s strategy, especially as it brings with it two important elements.

The first of these is that it delivers the company a fully-permitted mining lease on a site that has had operations on it before.

It comes with grid power connected to site and the usual site infrastructure completed, so all the work that usually entails spending both a lot of money and time has already been spent bringing the project to its current advanced stage.

“To get a full-scale mining lease can take up to two years sometimes, which also entails environmental licencing,” Papendieck explained.

“With the Sertão project we walk into a full environmental and mining permit so it saves us so much time and money.

“We already have Cascavel permitted to extract ore, not to process it on site, however we are currently in the phase of applying to advance that to a full-scale mining lease.

“At the moment our only option for processing ore is by means of a toll treating agreement with Cleveland Mining (ASX: CDG).

“That’s a very good agreement and one we intend on utilising, however the addition of the Sertão project means we now have the option of spending a small amount of money on constructing our own gold circuit on site.

“It basically provides us with an instant gold mining lease, from where we will be able to process ore we mine from Cascavel.”

The second aspect the Sertão project brings to the game is a bank of historic drilling data from previous campaigns conducted by Troy and Western Mining before them, beneath the existing open pit, which highlighted Cascavel-style strike and dip extensions to the mineralised zone which remain largely untested.

Results include:

0.7m at 48.2g/t gold approx. 100m down dip from Sertão open pit; and

0.33m at 119.6g/t gold approx. 750m down dip from Sertão open pit.

Orinoco believes this drilling clearly demonstrates extensions to the ore body mined by Troy with the deepest hole intersecting mineralisation at depth from the bottom of the pit.

The mineralisation at the Sertão project is only 18km along from Cascavel and Orinoco is confident it is part of the same geological event as at both sites it is very similar in style and structural controls.

Comparing the knowledge Troy gleaned from its time at Sertão and the work it has completed at Cascavel to date has allowed Orinoco combine years of geological thinking.

“We feel Sertão has the ability to add resource ounces in the short to medium term, enabling us to keep adding to our resource base and maybe even a second front of production,” Papendieck said.

“We have just over 200 square kilometres of ground in the greenstone belt now and there are plenty of opportunities for us to keep making new discoveries within our portfolio.”

Orinoco Gold considers its acquisition of the Sertão project has bought time and will also save it valuable capex dollars and provide the ideal start to the company’s ambitions of being recognised as developer rather than a junior exploration play in the region.

“This is a pivotal moment for Orinoco Gold,” Papendieck said.

“We have just completed a placement, which positions us to conduct a quick campaign involving an exploration decline, generating high-grade stockpiles, and carrying out infill drilling which will give us our maiden Resource over an area covering just 10 per cent of Cascavel.

“Once we have that Resource we will complete a Scoping Study, which will look at toll treating with Cleveland and also at how little it may cost to put a gravity treatment plant at Sertão.

“We believe we can quickly add resources at Sertão as well as from other areas of Cascavel.

“When we finalise our recently announced rights issue we now have a very clear path to Resource growth and to low cost production and we are fully-permitted to do all that, we have all the right pieces we need falling into place to get us underway.

“We are now developing a gold mine.”

Orinoco Gold Limited (ASX: OGX)
…The Short Story

Ground Floor
16 Ord Street
West Perth WA 6005

Ph: +61 8 9463 3241
Fax: +61 8 9226 2027

John Hannaford, Mark Papendieck, Dr Klaus Petersen, Brian Thomas, Ian Finch

Trafford Resources 15%
John Hannaford 6%

Exploration upside trumps boardroom power struggle

THE INSIDE STORY: South Australian uranium and South American copper form the basis of Alliance Resources’ current focus.

The flagship project of Alliance Resources (ASX: AGS) is its 25 per cent interest in the Four Mile uranium project located 550 kilometres north of Adelaide in South Australia. Quasar Resources has a 75 per cent interest in the project.


Under the terms of the JV, Alliance is free carried through exploration.

Quasar is an affiliate of Heathgate Resources, owner and operator of the adjacent Beverley uranium mine – Australia’s third uranium mine and the only in situ leach mine.

The Four Mile project boasts an impressive set of numbers, including a 2012 JORC Code-compatible Indicated and Inferred Mineral Resource estimate of 9.8 million tonnes at 0.33 per cent uranium oxide (U3O8) containing 32,000 tonnes (71 million pounds) of contained U3O8.

With these figures it’s understandable the Four Mile uranium deposit is considered by most pundits to be one of the larger uranium deposits going around, not only in Australia but on the global stage.

However, not all is as happy as it could be between the JV partners at present as they disagree over how to develop the project.

“During the year, Alliance announced that a decision to recommence development of the Four Mile uranium project was made with Quasar Resources Pty Ltd (Quasar) voting its 75 per cent interest in favour and Alliance’s wholly owned subsidiary, Alliance Craton Explorer Pty Ltd (ACE) voting its interest against Quasar’s Start-Up Plan and Proposed Program and Budget,” Alliance stated in its Annual Report last year.

“Quasar has advised that an updated schedule of activities and cash flow projections will be provided once all government approvals have been received, taking into account later commencement and completion dates from those set out in its Start-Up Plan and Proposed Program and Budget.

“Notwithstanding this decision to recommence development, ACE still considers the construction of an appropriately sized stand-alone plant at Four Mile would produce a better outcome for ACE and Alliance in general.”

The potential of the Four Mile deposit was highlighted recently with the announcement of drilling results, which encountered further uranium intercepts at the discovery area Alliance announced in December 2013, located 1.2 kilometres to the northeast of the Four Mile East uranium deposit.

Results included:

FMD0017: 3.7 metres at 0.39 per cent uranium; and

FMD0018: 3.2m at 0.45 per cent uranium, 1.7m at 0.3 per cent uranium, 2.6m at 0.39 per cent uranium.

Alliance also recently reported the intersection of high-grade uranium mineralisation over a strike length of approximately 1100m and a maximum width of 800m, which is an increase of 300m of what had previously been reported.

While all this has been happening Alliance has added a further project to its fleet, this time casting an exploratory eye over the South American country of Chile.

Alliance’s Chilean properties are located in the Cabeza de Vaca district of Atacama Region III, placing them in northern Chile’s iron-oxide copper-gold belt, close to the mining centre of Copiapo and 27km southeast of the 479 million tonnes at 0.95 per cent copper, 0.22 grams per tonne gold, 3.1g/t silver La Candelaria mine owned by Freeport-McMoran Copper & Gold Inc.

The company’s Chilean subsidiary company, Alliance Chile has secured several options to acquire copper-gold properties and has submitted applications to acquire three exploration licences covering the greater part of the Cabeza de Vaca district.


“It’s in the northern regions that the bulk of the country’s major copper deposits exist,” Alliance Resources managing director Steve Johnston told The Resources Roadhouse.

“We believe there is much potential for large porphyry deposits in the region, however we are trying to target and focus on high-grade, near-surface deposits, which are related to the porphyry style deposits at depth.

“Our exploration manager and are contract geologist are on the ground in Chile at the moment and reviewing and sampling specific third party opportunities.

“We’ll get those samples back, analyse them and then make the decision as to which of these prospects we may follow up.”

Johnston said the company was excited to be exploring in Chile saying it is a great place to be as a junior exploration play with many deposits outcropping at surface as well as some of the world’s biggest copper mines already operating there.

“We are looking for a porphyry-style deposit but we haven’t ruled out the smaller high-grade deposits,” he said.

“We feel that if we can find an area that hosts enough of these smaller deposits we then have a chance of locating a feeder zone of a buried porphyry that hasn’t been unroofed.

“That’s really our focus at the moment, identifying second tier targets first with the hope of finding a first tier target.

“Financially, developing a tier one target is tough for a company the size of Alliance, so if it did intersect one, then we would be seeking Joint Venture interest from a major to come in and help to develop it.

“Alternatively, should we hit a smaller deposit of high-grade copper at one to two per cent, then we are more than capable of doing that by ourselves.”

In recent times Chile has developed a reputation as a country with low sovereign risk that encourages exploration, even though it does have a slightly complex tenement structure to navigate.

Basically a lot of Chilean people own one or more mining tenements or concessions.

These get handed down through the family who typically option these tenements out to companies to earn a modest fee each year with a much larger fee if the option is exercised.

The system allows exploration concessions over the top of the mining concessions, allowing exploration over the tenements, enabling companies to conduct drilling, airborne geophysics and geochemistry, however companies ultimately require the permission of the underlying mining concession holder when it comes to exploitation.

“It has taken us just on two years, but we now have established a pretty firm footing in Chile,” Johnston explained.

“It’s been a new region and new regime for us and the learning curve has been quite steep, but we know how things operate over there now.

“From an exploration point of view it is actually a good system, even if you might find yourself dealing with ten different concession holders.

“One major difference from the way we do things in Australia is that here you may start with a tenement holding of 1,000 square kilometres and gradually narrow that down to around 100 square kilometres pinpointing particular targets or point of interest.

“In Chile you may lay out a large Exploration Licence area but the actual mining concessions are reasonably small and as many targets outcrop, this means the footprint of your target area is quite small allowing you to focus in and do the appropriate deals.”

In its September 2013 Quarterly the company reported it was well placed financially with around $24 million in the bank.

Having not dipped into the account in any great way since then it is well-funded to conduct drilling at Cabeza de Vaca, which it anticipates kicking off in the first half of this year.

Alliance Resources Limited (ASX: AGS)
…The Short Story

Suite 3, 51 – 55 City Road
Southbank, VIC, 3006

Ph: +61 3 9697 9090
Fax: +61 3 9697 9091

John Dunlop, Ian Gandel, Anthony Lethlean, Steve Johnston

Abbotsleigh Pty Ltd            25.76%
NEFCO Nominees Pty Ltd            2.27%
John S Dunlop Nominees Pty Ltd    1.78%
J P Morgan Nominees            1.75%

341 million


$56.3 million (at 24/1/14)



Octagonal Resources shoots to Producer status

THE INSIDE STORY: Sometimes putting the cart before the horse can be a smart way of operating, especially when your cart is the only suitable operating gold processing facility in the area.

Octagonal Resources (ASX: ORS) has achieved a rare feat by attaining the status of gold producer before commencing mining activities at any of its numerous projects.

Octagonal has been producing gold from its 100 per cent-owned 150,000 tonne per annum carbon-in-leach gold processing plant located near Maldon.


Maldon sits on a rich goldfield, historically producing over 1.7 million ounces of reef-hosted gold at an average grade of 28 grams per tonne, in Central Victoria.

The area rates third behind Victoria’s more famous gold rush regions, Bendigo and Ballarat.

The Maldon processing plant was recently refurbished and is fully permitted and operation ready to process competent underground ore and lower grade open pit ore.

“This means we can process lower grade and oxidised gold other operations are unable to efficiently recover,” Octagonal Resources managing director Anthony Gray told The Resources Roadhouse.

“This gives us exposure to third party ore by toll treating arrangements.”

In the past 12 months Octagonal has established two ore processing arrangements providing a revenue stream to enable it to develop its own ore sources.

In February 2012, Octagonal struck an agreement with A1 Consolidated Gold to treat up to 150,000 tonnes of ore over a three year period from its A1 gold mine at Woods Point.

In August it agreed to reprocess tailings from the Kangaroo Flat gold mine of Unity Mining near Bendigo.

“In consideration for the removal of tailings, transport, processing and refining, and paying 50 per cent of the costs- we receive 50 per cent of the gold,” Gray explained.

“We commenced regular gold production from these tailings in November.

“During the December quarter we processed 6,430 tonnes of tailings to recover almost 1,400 ounces of gold at an average recovery grade of 6.5 grams per tonne gold.

“We are producing gold on a weekly basis at grades beyond our expectations and expect to be producing gold from this material until the middle of this year.

“For processing the A1 ore, we receive a processing fee and 10 per cent of the gold produced.” 

Being a regular gold producer, Octagonal can now self-fund its exploration, mining and future growth, without diluting existing shareholders’ interests.

Octagonal’s primary focus is its Victorian operations where it is targeting 30,000 ounces per annum of low-cost gold production.

“In this area we own 17 exploration and mining licences overlying 900 square kilometres and seven historic goldfields,” Gray said.

“Our Victorian mining strategy is to develop a sustainable, low-risk gold operation by focussing on grade and profit, not tonnes and ounces.”

This is a reasonable objective; besides its gold processing plant, Octagonal also boasts 245,000 ounces of underground and open pit ore sources, an established decline towards said underground resources, and advanced exploration plays it is confident can sustain operations.


The 1.9 kilometre-long Union Hill decline accesses the Alliance South gold deposit and the southern half of the Maldon goldfield and is within 100m of the Alliance South shoot, which has an inferred Resource of 182,000 ounces of gold.

Octagonal is currently extending the Union Hill decline 180m to the south and developing two levels to determine the grades of the ore shoot, assess ground conditions, and determine the most appropriate mining technique for an ongoing operation.

Development of the Alliance South shoot will be the first step towards establishing an ongoing underground mining operation at Maldon.

The Alliance South shoot is hosted by the Eaglehawk Reef: one of five reefs in the central Maldon shear zone to have produced almost 1.5 million ounces of gold.

The others are the Nuggetty Reef to the north, and the Beehive, German and Derby Reefs to the south.

“We have five priority exploration targets on these reefs, which we intend to drill test once the Union Hill decline is developed sufficiently to the south,” Gray said.

“Each target has potential to host between 50,000 and 100,000 ounces of high-grade gold mineralisation and could contribute to ongoing underground mining operations.”

To supplement its underground mining at Maldon, Octagonal is currently developing three open pits.

The first to come into production will be the Black Reef on the Wehla goldfield, 60km from Maldon.

Octagonal intends operating a trial open pit at Black Reef to 30m depth in an area where a costean returned 14m at 4.5g/t gold and drilling intersected 5m at 15, and 5m at 35g/t gold.

“Our expectation is that by improving our understanding on the distribution of gold at Black Reef this will help us to interpret drilling results and help justify a larger open pit mining operation at Wehla,” Gray said.

A second, and significantly larger, open pit will be at the Pearl Croydon deposit, which is located 40km from Maldon and hosts an inferred resource totalling 53,000 ounces of gold.

The Pearl Croydon deposit consists of a 1.6km long reef system and is located on a granted mining licence.

A recent open pit optimisation study indicated Pearl Croydon has potential to produce between 15,000 and 32,000 ounces of gold.

Octagonal is developing a mine plan for this deposit, which once finalised will allow it to seek regulatory approval to commence mining.

The company’s third open pit mine will be the Specimen Reef located 30km from Maldon near Donnelly, which consists of a greater than 1km long line of reef.

Octagonal discovered this deposit in July last year and has since drilled 47 RC holes to define an initial inferred resource containing 10,000 ounces of gold.

“This mineralisation extends over 440 metres strike length and is not constrained by drilling to the north, south, or down dip,” Gray said.

“In June last year we applied for a mining licence to exploit this deposit and we will recommence drilling this deposit later in the year to upgrade the resource and start to define its size.”

In conjunction to its Victorian operations Octagonal intends to grow its Western Australian assets, where it holds a significant landholding located 70km southeast of Kalgoorlie, surrounded by the 12 million ounce St Ives goldfield, 800,000 ounce Daisy Milano mine and 400,000 ounce Salt Creek mine.

The main focus here is the Burns prospect, where 272 aircore holes were drilled in 2011 to define a one square kilometre area of gold anomalism.

Subsequent drilling in 2012 discovered potentially economic gold, copper, and silver, which led the company to have all samples from the 2011 aircore programs re-analysed for copper.

Octagonal has now identified thick zones of copper anomalism, where the latest drilling has defined a 2km long anomaly between 80m and 350m wide, not constrained by drilling, along its southeast margin.

A second anomaly was also identified over 700m not constrained by drilling to the northwest.

“We are excited by the potential of the Burns prospect to develop into a significant multi-commodity deposit,” Gray said.

“In December 2012 the Western Australia government awarded us a $150,000 co-funded drilling grant as part of its exploration incentive scheme for our first four hole diamond drilling program at the deposit, which we expect to complete later in the year.”

Octagonal Resources Limited (ASX: ORS)
…The Short Story

Suite 3
51 – 55 City Road
Southbank VIC 3006

Telephone: +61 3 9697 9088
Facsimile: +61 3 9697 9089


Ian Gandel, Anthony Gray, Robert Tolliday, Jason Mills

Alliance Resources    20.8%
Ian Gandel        18.7%
JP Morgan Nominees    8.9%

106.05 million


$12.2 million (at 13/3/13)


Azure Minerals – Mexico’s favourite Aussies

THE INSIDE STORY: It’s encouraging when an exploration company exemplifies the definition of the term explorer, which according to my dictionary: ‘travels into undiscovered or un-investigated territory’.

In 2005, while contemporaries wrestled over projects in Australia or headed to less-politically friendly climates in Africa, Azure Minerals (ASX: AZS) journeyed to Mexico.

“We were looking for projects, but what was available in Australia was too expensive and most of the good projects had been well picked over,” Azure Minerals managing director Tony Rovira told The Resources Roadhouse.

“We looked in Central and South America, Africa and Indonesia, but Mexico stood out with better projects, not just technically, they were located in an ideal mining environment.”

Azure was by no means the first mining company to recognise Mexico’s potential.

Today over 350 mining and exploration companies with a healthy representation from North America, particularly Canada, operate in the country.

Azure was, however the first Australian company to stake its Mexican claim.

What is not celebrated outside of the America’s, is Mexico’s reputation as a mining friendly jurisdiction and mining history dating back over 500 years.

“The government and the general population understand the benefits mining brings so they want to help you and to attract more investment,” Rovira said.

“Its mining history combined with the current exploration and mining activity means there is a substantial support industry in place.

“There are dozens of drilling companies and assay laboratories, all the infrastructure you need is there.”

Azure’s introduction to Mexico was an earn-in Joint Venture with a Canadian junior company.

Once established, Azure staked properties in its own right.

Azure Minerals project locations in Mexico. Source: Company

The project to emerge as the company’s flagship is the Promontorio copper-silver-gold project, located in Chihuahua State.

Promontorio possesses high-grade copper sulphide mineralisation containing significant grades of gold and silver.

In the four years it has held the project, Azure has completed three large-scale diamond drilling programs totalling some 87 holes for around 13,000 metres.

From this drilling it has calculated an initial JORC-complaint total mineral resource of 502,000 tonnes at 4.7 per cent copper, 2.1 grams per tonne gold, 99 grams per tonne silver for 23,400 tonnes of copper, 34,000 ounces of gold and 1.6 million ounces of silver.

“It is a high-grade copper-gold-silver project that is modest in terms of tonnes at this stage, but we consider it to hold a great deal of potential for expansion,” Rovira explained.

“The most recent drilling at Promontorio was completed in January this year and the results have been very encouraging.

“We have completed a Scoping Study and a Pre-Feasibility Study as well as economic evaluation and mine planning, which have provided very positive results.

“We anticipate the increase in the resource will be enough to get this project up and running for a mine life of around eight to nine years.”

Azure recently drilled two holes outside of the Promontorio deposit to test two areas where historical shallow drilling, by previous owners, identified gold and silver mineralisation.

The first of these areas was Cascada, situated 200m northwest from Promontorio.

From 40m Azure intersected 70m of copper sulphide mineralisation grading 2.7 per cent copper equivalent.

That 70m interval included 36m of material running at 4.7 per cent copper equivalent, including a 13m intercept at 11 per cent copper equivalent.

Rovira acknowledges the result stemmed from one single drill hole, but in any language, a 70m intercept draws attention and could possibly indicate a deposit with significant size potential.

“The Promontorio deposit consists of veins varying two metres to five metres wide, whereas we think Cascada has potential to be a large volume deposit, with potential high grades as well,” Rovira said.

“Cascada definitely demands more attention and we intend conducting some serious work there involving a significant amount of diamond drilling.”


Targets surrounding Promontorio. Source: Company announcement

Testing of the other target near Promontorio called Risco Dorado, or Golden Cliff, also raised eyebrows by intersecting an 11m wide interval of silicified volcanic rocks containing disseminated and semi-massive pyrite and copper sulphides.

“It just shows the Promontorio project is not just the Promontorio deposit but includes numerous additional opportunities along strike, which require further work,” Rovira said.

“We see potential to develop a large mining operation. We’re very excited by what we have discovered so far and we will be back in there drilling as soon as we can.”

When the Global Financial Crisis brought tough economic times Azure was approached by Japanese Government organisation JOGMEC (Japan Oil, Gas and Minerals National Corporation), which also recognised Mexico’s potential for big mineral deposits, to form a Joint Venture to explore for copper deposits in Mexico.

Having similar arrangements in Australia JOGMEC was pleased to JV with a company in Mexico boasting Australian exploration expertise.

Azure’s two Joint Ventures with JOGMEC cover the El Tecolote and La Tortuga projects where the search is on for porphyry copper and skarn copper-zinc deposits.

Azure is free carried and operator of both projects.

JOGMEC can earn 70 per cent interest of the El Tecolote project by sole funding US$13 million of exploration expenditure. To date about US$3M has been spent.

So far El Tecolote has undergone several geophysical surveys, including aeromagnetics, VTEM and IP, as well as geological mapping and sampling, and 30 diamond drill holes.

Some very encouraging copper and zinc intercepts have been made, and further drilling is being planned to define the mineralised zones.

At the La Tortuga project, JOGMEC can earn 51 per cent interest by sole funding US$3 million of exploration expenditure and to date about US$2.5M has been spent.

“La Tortuga, or The Tortoise, is actually an apt name because we have been exploring this project in Joint Venture with JOGMEC for five years,” Rovira said.

“It has been progressing slowly, but with encouraging results, and we are confident slow and steady is going to help us win this particular race.”

Geophysical work at La Tortuga resulted in the identification of a large, deeply-buried porphyry copper target, into two deep diamond core holes of over 600m were drilled.

“We know the target starts around 600 metres below surface, but the strongest part of the anomaly is at a depth of about 1,000 metres,” Rovira said.

“One hole reached 660 metres and the other 605 metres. Both holes drilled into the top of the body and intersected promising looking porphyry rocks containing indications of precious metal and base metal mineralisation.

“We plan to drill another hole very soon; this time with a target depth of 1000 metres, which will take us into the middle of the anomaly.”

The next six months will be a very busy time for Azure Minerals as it works to complete the resource update for Promontorio, which is anticipated in April.

There will also be follow up drilling at Cascada and Risco Dorado plus regional mapping and sampling to identify more drilling targets within the project area.

“We also have a gravity survey at La Tortuga to assess and we expect to commence drilling the deep diamond hole very soon,” Rovira said.

“We don’t know what we will find down there, but what we’ve seen so far has been very encouraging.

“Our model is a big porphyry copper or IOCG-style of deposit, and if we’re successful then that will kick-off an entire new ball game for the company.”

Azure Minerals Limited (ASX: AZS)
…The Short Story

Level 1, 30 Richardson Street
West Perth, WA 6005

Phone: +61 8 9481 2555

Fax: +61 8 9485 1290


Peter Ingram, Anthony Rovira, Wolf Martinick

Yandal Investments Pty Ltd    5.2%
Drake Private Investmenst LLC    5.1%
Stadjoy Pty Ltd            2.5%

566 million

$44 million (at 25/02/13)

Corazon Mining maintains nickel focus amid new acquisitions

THE INSIDE STORY: To simply describe 2012 as hectic for Australian exploration company Corazon Mining (ASX: CZN) would be understating the company’s achievements.

While continuing to develop its Lynn Lake nickel asset in Canada, Corazon took advantage of opportunistic market conditions in 2012 to add new, quality projects to its portfolio.

These included the Canadian Beaucage Lake gold project and the recently-announced option to acquire the copper-gold Top Up Rise (TUR) project in Western Australia.

The new additions complement Corazon’s core focus to advance its Lynn Lake nickel-copper project, which the company believes represents a significant development opportunity.

Lynn Lake is a historical nickel, copper and cobalt mining camp which operated for more than 20 years.

The project’s exploration upside was boosted after Corazon discovered high-grade mineralisation beneath the old EL Mine, which also boasts defined near-surface mineralisation beneficial for any new mining operation.

The EL Mine was one of the highest grade nickel mines in the district, operating between 1954 and 1962 and producing 1.9 million tonnes at 2.5 per cent nickel and 1.15 per cent copper.

Corazon has estimated an interim Inferred Resource for the EL Deposit at Lynne Lake of 1.8 million tonnes at one percent nickel equivalent, including contained metal of 14,000 tonnes nickel, 9,000 tonnes copper and 400 tonnes cobalt at a cut-off grade of 0.6 percent nickel equivalent.

“We’re very much committed to nickel and to our Lynn Lake project in Canada,” Corazon Mining managing director Brett Smith told The Inside Story.

“We have a resource, and we also have significant drill-defined tonnages at surface that aren’t included in the resource, which we consider to hold potential to more than double the resource tonnage.

“We have conceptual open-cut mining studies that identify some 2 to 3 million tonnes of surface material that is not included in our resource.

“These factors will be key to starting up a mining operation in the Lynn Lake area.”

Testament to its commitment to Lynn Lake, Corazon renegotiated its Earn-In and Option agreements to acquire the project and expanded the project area.

The original agreement provided Corazon an option to acquire 100 percent ownership of the project by spending CAD$3 million on exploration and paying CAD$2 million in cash prior to 20th October 2012.

The new deal extended the option period to 20th October 2015, reduced the purchase payment to CAD$1 million and added the South Plug nickel-copper target and Barrington Lake copper deposit to the project.

The South Plug nickel-copper target is located immediately south of Corazon’s land holding and contains a differentiated mafic/ultramafic intrusion similar to those hosting the Lynn Lake mining camp nickel-copper deposits.

The Barrington Lake copper deposit is located 43 kilometres east-northeast of Lynn Lake.

Exploration activities conducted on Barrington Lake in the 1990’s defined copper mineralisation and numerous geophysical anomalies, which have never been subjected to any follow-up drilling.

Most of the historic attention at Barrington Lake focused on an outcropping zone of approximately 107m in strike and 4.6m in width, with an average grade of 2.63 percent copper.

Corazon also added a Canadian gold project to its portfolio in a strategic move to maximise its activities in the Lynn Lake region.

Corazon acquired the Beaucage Lake gold project, located 45km from the Lynn Lake project in a region hosting several one to two million ounce gold deposits.

“The Beaucage Lake acquisition wasn’t one that we deliberately pursued,” Smith explained.

“It was more opportunistic as exploration and investment activity in Canada has not been as enthusiastic as it has been in Australia recently.

“A great number of projects are becoming available and Beaucage Lake was one in which we see great exploration potential.

“It is located nearby to Lynn Lake so it provides us with an additional exploration focus that complements our other Canadian assets.”

Extensive high-grade gold mineralisation has previously been identified at surface at Beaucage Lake over a 7 to 8km strike length.

Corazon is currently compiling all available historical data for the project with a view to applying modern exploration techniques to define drill targets.

“The data accompanying the acquisition dates back to the 1980s and, not being digital, is difficult to reference,” Smith explained.

“As such, we have to get all that old information into new-world order.

“There is a lot of information including numerous high-grade gold drill results that have never been put together and looked at the way we are looking at them.”

In October, Corazon secured an option to earn up to 75 percent of private company Border Exploration, which owns 100 percent of the Top Up Rise project in Western Australia.

The TUR project is located in the Gibson Desert region of north-eastern Western Australia and is prospective for large gold-copper intrusive related deposits, similar in style to Olympic Dam, Prominent Hill and Carapateena.

The primary target identified at TUR is an unexplored gravity anomaly, which presents one of the largest amplitude residual gravity anomalies in Australia.

Exploration work conducted by Border defined the core of the anomaly to be 8km by 4km in area, which is similar in size to Olympic Dam’s geophysical anomaly.

Other exploration work at TUR has been conducted by the Australian Geological Survey Organisation and the Geological Survey of Western Australia.

This work identified a granite intrusive and alteration complex at Mt Webb, which was described as being, “large by Australian standards”, with, “characteristics of world class copper-gold systems”.

The impetus to conduct the deal came from Corazon’s broker, Hartleys, which considered the project to be an ideal joint venture for the two companies.

Smith, a director of Corazon and Border, initially believed the TUR project was more suited to development by a larger company, and was cautious in pursuing the joint venture option.

“Border’s intention was to advance the project as a private entity,” Smith said.

“Border had expressions of interest in the project from other companies, but considered it was too early for such a deal and that Border would be able to inexpensively add a lot of value to the project on its own.

“The success of early stage exploration plays such as De Graca for Sandfire and Nova for Sirius was definitely a catalyst for both Corazon and Border recognising a mutually beneficial joint venture.”

Smith stressed Corazon’s latest raft of acquisitions do not signal a shift away from the company’s chief focus – nickel.

“When you look at our Lynn Lake nickel-copper sulphide project in Canada, it is obvious nickel remains our most valuable metal, but it’s well supported by the early-stage exploration plays,” he said.

“When we extended the option on Lynn Lake we also picked up the Barrington Lake copper project and soon after completed the Beaucage gold project deal.

“These project areas in Canada also include a multitude of VMS targets containing lead, zinc and gold mineralisation.

“The reality is that Corazon’s assets already have numerous prospects containing various metals, so it’s not as if we’re chasing anything new.

“The only really obvious deviation for Corazon as far as the TUR project is concerned is that it is located in Australia, our own backyard.

“We are a small company, conscious of the cash we have and how we can preserve that cash and diligently work all the opportunities within our portfolio.
“2013 will be a very busy year for us.”

Corazon Mining Limited (CZN)
…The Short Story

Level 1
350 Hay Street,
Subiaco  WA  6008

Ph: +61 8 6364 0518   
Fax: +61 8 6210 1872



Clive Jones, Brett Smith, Jonathon Downes, Adrian Byass


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