THE BOURSE WHISPERER: Investors with an eye for the gold sector have been wondering for some time what the next move may be of gold miner Doray Minerals (ASX: DRM) after successfully bringing its Andy Well gold mine on stream.

Those questions have been answered with the announcement that Doray has entered into a farm-in agreement with Alloy Resources (ASX: AYR) to explore that company’s prospective and underexplored Horse Well gold project, located in the north-eastern Goldfields of Western Australia.

Doray considers the Horse Well project to be an attractive exploration opportunity as it has many similarities with the highly endowed Yandal Belt to the south and its relative lack of recent systematic exploration.

“We believe, given the geology, structural setting and results achieved to date, that there is the potential for discovery of a significant gold deposit within the project area and we look forward to working with Alloy Resources to advance the project,” Doray Minerals managing director Allan Kelly said in ihis companiy’s announcement to the ASX regarding the deal.

The binding Heads of Agreement between the two entities includes the following key terms:

$100,000 cash payment to Alloy at Commencement;

Doray to spend $2 million within two years to earn 60 per cent, $900,000 of which is to be spent on non‐withdrawal expenditure within the first 12 months after commencement with Alloy to manage the initial agreed field exploration program;

Doray to spend a further $2 million within three years of commencement, at which time Alloy can elect to contribute pro-rata (at 40per cent) to this $2 million or dilute to 20 per cent using an industry standard formula, whereby Doray can earn up to 80 per cent and

Alloy to contribute from PFS and beyond (i.e. DFS, DTM and operational JV) or dilute to a one per cent NSR using an industry standard formula.

Alloy controls approximately 850 square kilometres of exploration tenements in the northern part of the Millrose Greenstone Belt located in the north-eastern Goldfields of WA.

 

Horse Well project geology and prospect locations. Source: Alloy Resources announcement

 

Those in the know have interpreted the Millrose Greenstone Belt to posess similar geology to the Yandal Greenstone Belt, which hosts the Nimary-Jundee, Bronzewing, Darlot and Mt McClure gold deposits.

Alloy’s leases cover approximately 50 strike kilometres of the belt, with Alloy estimating Mineral Resources totalling a combined 100,000 ounces of gold within the Horse Well project area, from four separate prospects, Palomino, Filly, Bronco and Filly SW.

Work completed by Alloy over the last two years has extended the prospectivity for new gold discoveries along the entire greenstone belt.

This has been a major part of the attraction for Doray with the company saying it believes there is potential to define a significant new gold deposit, similar to the plus-five million ounce Jundee and Wiluna mining centres located in adjacent greenstone belts.

Fortunately for all involved, Alloy Resources shares Doray’s confidence in the project.

Alloy said being able to strike such an agreement in current market conditions with a company that has runs on the board as Doray provides it with access to the requisite funding and technical expertise to continue an exploration program at Horse Well.

Alloy said both companies consider the Horse Well gold project to be a major new discovery.

A positive aspect to support that assertion is that Alloy has been able to bring the project to the point it has using the limited resources it has had to work with.

The company said it was excited about the results that a systematic fully funded program may bring.

A Mineral Resource of 100,000 ounces of gold has been established and over the last two years exploration has extended the prospectivity for new gold discoveries along the entire greenstone belt,” Alloy Resources said in its ASX announcement.

“The company and its new partner are focussed on defining a significant new gold discovery similar to the Jundee and Wiluna mining centres located in adjacent greenstone belts to the south.”

THE BOURSE WHISPERER: A quick look at some up and coming Resource companies waiting to list on the boards of the ASX.

American Patriot Oil & Gas Limited
Proposed ASX code: AOW
Proposed listing date: 12 may 2014

American Patriot is an oil and natural gas exploration and development (E&P) group, focused on oil and gas exploration and development opportunities in Rocky Mountain Basins.

Since its establishment, American Patriot has assembled, what the company considers to be, a portfolio of prospective oil and gas exploration assets in America.

American Patriot is headquartered in Melbourne, with a U.S. office in Denver Colorado.

The company will have approximately 56,000 Gross Acres under lease across five key projects.

American Patriot is currently engaged in developing and exploiting these properties to provide long-term growth in stockholder value.

China Mining Limited
Proposed ASX code: CMF
Proposed listing date: TBA

China Mining Limited is a mining group which focuses on global mining investment and development business.

The company is currently operating mining projects in Australia, with the aim to assist overseas mining companies to develop business with China, and helping Chinese investors to invest in the overseas mining projects.

China Mining said it hopes to work alongside other mining organizations and to co-operate wherever possible, to promote the mining industry.

According to the company, Australia’s highly-developed infrastructure, skilled workforce and strong focus on R&D and innovation makes the country an ideal destination to establish mining operations.

Fifth Element Resources Limited
Proposed ASX code: FTH
Proposed listing date: 19 May 2014

Fifth Element Resources Limited offers investors exposure to early stage copper and gold exploration projects in an established mining area of Mid-Western New South Wales.

The company is a junior mineral exploration company that has assembled a diversified portfolio of prospective projects it claims provides exposure to the key commodities of gold and copper.

The company has been conducting exploration since early 2012, which has resulted in the acquisition of four Exploration Licences.

Fifth Element described its core objective to be the generation of shareholder wealth through the successful exploration and development of mineral deposits.

Its focus is on adding value to the gold and copper potential of the tenements through staged program of target identification, delineation and testing by application of high resolution airborne magnetics and gravity studies resulting in the identification of targets for drilling.

Huayi Resources Limited
Proposed ASX code: HUA
Proposed listing date: 15 May 2014

HuaYi Resources currently has a magnesite project in the mountainous region of Haicheng City, in the Province of Liaoning, PRC (Jincheng magnesite project).

The company claims SRK has undertaken 3D modelling, which indicates an exploration target tonnage estimate of between 41 million tonnes and 46 million tonnes of magnesite mineralisation could be considered for the Jincheng Magnesite project.

HuaYi Resources indicated it intends to undertake a drilling program with the aim to provide JORC (2012) compliant resource for the Jincheng magnesite project and verify and validate PRC classified mineralisation estimates undertaken in the PRC in 2009 and 2012.

The company has a five-year mining license expiring on 20 November 2014, which it expects will enable it to remove up to 300,000 tonnes of magnesite ore per annum from the Jincheng magnesite project.

The project covers an area of 0.214 square kilometres with permitted operation altitude of 150 metres to 437 metres (being the metres above sea level at which it may extract magnesite ore).

Stavely Minerals Limited
Proposed ASX code: SVY
Proposed listing date: 7 May 2014

Stavely Minerals Limited (Stavely Minerals) is a mineral exploration company formed to acquire early to advanced stage exploration projects with demonstrated high potential for additional discovery.

Stavely Minerals was founded and is operated by members of the former Integra Mining Limited management team with a track record of discovery and value creation.

In January 2013 Stavely Minerals (previously Northern Platinum) agreed to purchase the Stavely and Ararat projects from BCD Resources.

The agreement was formally executed on the 20th May 2013.

Mount Adrah Gold Limited
Proposed ASX code: MLT
Proposed listing date: 6 June 2014

The Mount Adrah gold project is approximately 23 kilometres north-west of the township and old gold mining centre of Adelong, in central western New South Wales.

Mount Adrah Gold was an early mover in recognising the potential discovery of a large, new style of gold system –IRGS, in the Adelong-Wagga Wagga portion of the Gilmore Suture and juxtaposed hinterland.

Intrusions and minerals deposits occur along a north-west trend, parallel to the Suture, and appear to be localised on west and southwest trending cross faults or fracture systems.

Mount Adrah Gold considers this to be a prime exploration target for further mineralised IRGS deposits.

RTG Mining Inc
Proposed ASX code: RTG
Proposed listing date: 6 June 2014

RTG Mining is listed on the main board of the Toronto Stock Exchange and is a mining exploration company focussed on developing new gold opportunities.

The Company is earning a 51 per cent interest in the Segilola gold project in Nigeria, which it claims to host the largest undeveloped gold resource identified in Nigeria.

At the Segilola gold project, RTG has identified a maiden NI 43-101 compliant indicated resource of 521,814 ounces of gold contained in 3,620,386 tonnes at a grade of 4.5g/t and an inferred resource of 96,445 ounces of gold contained in 747,590 tonnes at a grade of 4g/t from just its first pass 11,000m drill program.

RTG was listed on the TSX in April 2013, subsequent to the Merger of Ratel Merger Limited with Ratel Group, and completed a capital raising of over C$20 million (net proceeds) upon its listing.

RTG has an experienced management team, and has B2Gold Corp. (the new parent entity of CGA Mining Limited) as an 18.2 per cent shareholder in the company.

B2Gold is a member of both the S&P/TSX Global Gold and Global Mining Indices.

RTG is focused on monetising its existing assets and acquiring major new assets which will allow the company to move quickly and safely to a producer.

Disclaimer: The above is intended as a guide only. The Roadhouse accepts no responsibility for investments made from this advice, successful or otherwise.

The views, opinions or recommendations of this article do not in any way reflect the views, opinions, recommendations, of The Resources Roadhouse.

The Roadhouse makes no representation or warranty with respect to the accuracy, completeness or currency of the content. The content is for educational purposes only and does not constitute financial advice. Independent advice should be obtained from an Australian financial services licensee before making investment decisions.

THE BOURSE WHISPERER: Thundelarra (ASX: THX) has acquired two Exploration Licences that fall within the boundary of the company’s Allamber project located approximately 30km north-east of Pine Creek in the Northern Territory.

The two licences, one of which is central to the Ox-Eyed Herring and Tarpon prospects, had previously been the subject of an option agreement between Thundelarra and the then owners of the leases, a syndicate of experienced prospectors.

Thundelarra said the acquisition of 100 per cent of these two licences, EL10043 and EL10167, has consolidated the company’s ownership of the various tenements comprising the Allamber project.

As a result Thundelarra now controls 100 per cent of the project area.

The consideration for the acquisition was $55,000, which the company satisfied by issuing one million shares to the vendors at a price of 5.5 cents per share.

“This acquisition completes a two-year process to bring all the Allamber tenements under one roof and so simplify administration and our exploration plans for the project,” Thundelarra chairman Phil Crabb said in the company’s announcement to the Australian Securities Exchange.

“We are convinced that Allamber has the potential to add to the positive news currently being generated at Red Bore and we are in the process of planning further exploration programs at a number of the exciting targets we have here.”

Email: info@thundelarra.com.au

Website: www.thundelarra.com.au

THE BOURSE WHISPERER: As they say in the classics; it’s better to have 50 per cent of a project than 100 per cent of no project.

Baotou considers Kimba Gap synergies with Bungalow

Centrex Metals (ASX: CXM) has received a letter from its partner for the Bungalow Magnetite Joint Venture, Baotou Iron & Steel (Group) Co. requesting the Prefeasibility Study currently in draft form for Bungalow be extended to analyse potential synergies with Centrex’s Kimba Gap magnetite project.

Centrex is currently undertaking resource drilling at Kimba Gap, located just 50km north of Bungalow, with completion expected in mid-2014 followed by a Mineral Resource Estimate.

Centrex will also complete conceptual development studies for the project based on the resource.

Baotou has asked that the Bungalow PFS be extended to incorporate results from the current Kimba Gap studies as it: “Considers that given the very similar nature of the magnetite projects at Bungalow and Kimba Gap, synergies will likely exist in utilising common supporting infrastructure for both projects.”

And that: “Sharing common supporting infrastructure would be a win-win scenario for both the Bungalow and Kimba Gap projects, and would spread the cost of these capital intensive items.”

Environmental Authority granted for Lorena gold project

Malachite Resources (ASX: MAR) announced the Queensland Department of Environment and Heritage Protection has granted the Lorena Joint Venture an Environmental Authority Permit (EA) in accordance with the Environmental Protection Act 1994 for the development of the Lorena gold project located east of Cloncurry in northwest Queensland.

The EA takes effect from 1 May 2014 and allows the JV to proceed with the development of the Lorena gold project subject to terms and conditions which are set out in the Permit.

The Lorena gold project is a 50/50 JV between Malachite and BCD Resources (ASX: BCD).

Joint Venture funding for West African iron project

Apollo Minerals (ASX: AON) has reached an agreement with Zoradox Ltd for the terms of a farm-in joint venture agreement for the Kango North iron ore and gold project in Gabon, central west Africa.

Under terms of the agreement, Zoradox may earn a 50.01 per cent equity interest in Apollo Gabon SA, which owns the project by sole funding:

a) US$750,000 of exploration and development activities during the remainder of 2014, and

b) a further US$3,250,000 before the end of 2017.

“We are pleased to have secured farm-in joint venture terms for the Kango North project,” Apollo Minerals chief executive officer Dominic Tisdell said.

“Apollo’s work to date suggests the Kango North project has the potential to be a member of the next round of successful mining projects in Africa.

“We welcome Zoradox to the project and look forward to working closely with them in further evaluating this exciting opportunity.”

Apollo and Zoradox are progressing exploration and planning of ground geophysics, sampling and mapping and a near term drilling program, which is designed to test a potentially significant DSO-grade iron ore prospect, P1, in the southeast of the project area.

Musgrave Project Collaboration

PepinNini Minerals (ASX: PNN) has announced a Research and Development (R&D) Collaboration with CSIRO for the company’s South Australian nickel–copper Musgrave project.

The collaboration will involve geophysical data collection and interpretation using the latest fixed wing high-moment electromagnetic system.

PepinNini said the electromagnetic surveying system will be similar to that developed by Anglo American for regional target generation, which is understood to be instrumental in the 2013 discovery of the Manchego nickel-copper system in West Musgrave currently held by Phosphate Australia Limited(ASX: POZ).

The collaboration will be managed by CSIRO and will involve expenditure by funding grant and company contribution in the order of $500,000.

“CSIRO will bring technical excellence to the Company’s R&D project aimed at deploying technical innovation to refine target mapping on the Musgrave project,” PepinNini Minerals Musgrave project geologist Todd Williams said.

Earn-in option for McArthur River project

Brumby Resources (ASX: BMY) has entered into an earn-in option arrangement with Teck Australia, a wholly-owned subsidiary of Canada’s Teck Resources to explore for zinc on Brumby’s McArthur River tenements (EL 25467 and L29021) in the Northern Territory.

Teck will take a placement of 25 million Brumby shares at a set price of two cents per share, providing Brumby with $500,000.

Teck may earn up to a 70% interest in the McArthur River project by spending a minimum of $3.5 million on exploration expenditure before 30 June 2018, with a minimum of $0.5 million of this total to be spent before 30 June 2015.

Upon formation of the joint venture, Brumby will be entitled to a 1.5 per cent net smelter royalty on production from the McArthur River project.

Brumby has acquired the remaining 20 per cent of Exploration Licence 25467 from Arnhem Resources in consideration for the issue of 5 million shares in Brumby.

The subscription by Teck for the 25 million shares in Brumby is conditional upon the registration of Brumby as the holder of the remaining 20 per cent interest in Exploration Licence 25467 by the Northern Territory Department of Mines which is expected to be completed in the coming weeks.

THE BOURSE WHISPERER: Energy and Minerals Australia (ASX: EMA) has strengthened its finances following a capital raising deal with Andrew Forrest and restructure of the company’s balance sheet.

EMA has entered into a binding term sheet with Forrest Family Investments Pty Ltd, an Andrew Forrest entity within the Minderoo Group, to raise $12 million by way of an equity capital raising.

If that’s not enough, the company has also announced its note holders, Australian resource investment groups Acorn Capital Limited and its clients (Acorn), Macquarie Bank (Macquarie) and the Element Resources Fund, have agreed that the debt owed to them shall be repaid in shares, subject to certain conditions.

As a result $24.5 million of debt will be eliminated and converted into shares.

The company indicated the two transactions will restructure its balance sheet and increase its net assets by $36.5 million.

Commenting on his side of the deal Andrew Forrest described his investment as a strong vote of confidence in EMA’s executive management team of Mike Young and Julian Tapp, both of whom he has worked with in the past in developing Fortescue Metals Group’s (ASX: FMG) Nullagine JV with BC Iron (ASX: BCI).

“Julian and I have always worked extremely well with Andrew Forrest,” EMA managing director Mike Young said in the company’s announcement to the Australian Securities Exchange.

“We are confident this investment in the new management team will unlock EMA’s potential and future growth.

“Raising $12 million in equity and eliminating all of EMA’s $24.5 million debt will increase the company’s net assets by $36.5 million and provide EMA with a strong balance sheet and a more normalised capital structure.

“EMA is now set up to move the Mulga Rock uranium project forward to meet uranium demand which is expected to grow at phenomenal rate in coming years.”

Email: info@eama.com.au

Website: www.eama.com.au