THE BOURSE WHISPERER: Crusader Resources has increased the Measured and Indicated Resources of the company’s Borborema gold project in Brazil.

The new estimate of 50.9 million tonnes at 1.14 grams per tonne gold for 1.87 million ounces of contained gold has resulted in a 61 per cent increase from an estimate the company announced in November 2011.

Crusader said preliminary pit optimisations it had received on the updated Resource indicate that 43Mt at 1.2g/t gold for 1.66 million ounces of gold are contained within an economic pit-shell.

The numbers on this pit shell returned the highest average discounted cash flow for the project with a projected life of 10.5 years at a throughput rate of four million tonnes per annum.

The starter pit shell has a three year life, a strip ratio of 3.0 and a grade of 1.30g/t.

The company has also selected two other pit shells as guides for progressive pits.

 

Pit optimisation results for Borborema gold project. Source: Company announcement

“Crusader is now a major step closer to becoming a significant gold producer with Borborema poised to deliver its maiden Ore Reserve,” Crusader Resources managing director Rob Smakman said in the company’s announcement to the Australian Securities Exchange.

“This latest resource upgrade is a significant milestone for the project and Crusader.

“The drilling undertaken since November 2011 has returned great results and the subsequent increases in grade and ounces during the conversion of Inferred Resources into the Measured and Indicated Resource categories is crucial to Borborema becoming a gold producer.”

THE BOURSE WHISPERER: White Cliff Minerals and its Joint Venture partner, private company T2Gold have been granted a four year extension to the Chanach exploration license by the Government of the Kyrgyz Republic.

The country’s Department of Natural Resources (DNR) has also identified the JV comapny, Chanach LLC, to be one of a handful of companies to have complied with all regulatory requirements and is now a preferred tenderer for new license applications.

 

Location of the Chanach copper-gold project. Source: Company announcement

The Joint Venture partners said they intend to develop a closer relationship with the DNR and will seek to acquire further advanced projects in the Kyrgyz Republic.

According to a release to the Australian Securities Exchange by White Cliff Minerals the JV partners recently commissioned an extensive analysis of satellite ASTER spectral imagery to assist with targeting the 2012 exploration.

“The survey has identified widespread argillic, phyllic and silicic alteration that may indicate the centre of the mineralised copper-gold porphyry system centred southeast of the existing drilling,” the company said in the announcement.

“Outcropping mineralised diorite dyke swarms containing both copper and gold appear to radiate from the centres of the ASTER phyllic and silicic alteration systems.

“If confirmed by field mapping and sampling this may indicate a system of mineralised porphyries within a diameter of approximately five kilometres.

“These targets occur on and adjacent to outcropping porphyries and importantly coincide with the copper mineralisation previously identified at surface.

“The strongest targets occur on Silurian conglomerates and sandstones suggesting that these rocks are underlain by porphyry intrusions.”

White Cliff said the JV plans exploration activity for the remainder of 2012, which includes extensive multi-element soil and rock sampling over the south-eastern parts of the license over the interpreted core of the porphyry system in conjunction with a ground or helicopter borne magnetic survey followed by scout drilling of the identified targets.

Exploration will also continue on the Central Chanach copper-gold deposit where drilling will focus on extending and expanding the zone of supergene oxide copper mineralisation.

There will also be ongoing investigation on copper rock chip samples located on the magnetite skarn contact.

THE BOURSE WHISPERER: Australian resource development company, Metallica Minerals has completed its first round of pilot scale metallurgical testwork relating to scandium extraction from laterite oretypes sourced from the company’s NORNICO tri-metal project located near Townsville in North Queensland.

The company described the results of the testwork as being very positive, saying that they have confirmed its metallurgical flowsheet and proprietary scandium extraction and refining technology to be highly effective.

Metallica has claimed the results have positioned it as a leader in terms of achieving successful scandium extraction and recovery of high purity scandium at a pilot plant level.

The metallurgical testwork undertaken by Metallica was completed over a five to six month period commencing in February 2012 and consisted of two stages:

Stage 1: HPAL testwork for scandium-nickel-cobalt extraction from the NORNICO laterite oretypes at SGS Lakefield Oretest (SGS) in Perth; and

Stage 2: Scandium extraction and refining into scandium oxide at hrltesting in Brisbane.

Scandium minerals occur within the NORNICO laterite oretypes and via Metallica’s recovery process, the scandium is leached via the HPAL process into solution, and then extracted and refined to scandium oxide also called ‘scandia’.

Metallica said its pilot scale testwork achieved recoveries of approximately 85 per cent of scandium from the nickel laterite oretypes into a scandium oxide product that exceeded the company’s target purity level of over 99.9 per cent, with most of the product achieving 99.99 per cent purity.

 

Scandium oxide produced by Metallica. Source: Company announcement

 

“The results achieved by our metallurgical team are simply astonishing when taking into consideration that this is the very first pilot test run of a newly developed technology for extracting and refining scandium, all invented and designed by Metallica here in Brisbane,” Metallica Minerals managing director Andrew Gillies said in the company’s announcement to the Australian Securities Exchange.

“Achieving high scandium recoveries of approximately 85 per cent and particularly the refinement into scandium oxide of a purity of 99.99 per cent so soon, are results that exceeded our initial expectations.

“Based on our discussions with potential offtakers, the scandium oxide Metallica has produced should comfortably meet the specifications required by these consumers.

“We will be supplying samples of our scandium oxide product to various potential offtakers, for their evaluation, to confirm this.”

Metallica indicated that in order to protect its Intellectual Property, the company is in the process of submitting patent applications relating to its scandium extraction and refinement techniques.

Metallica said the patents will ensure potential shareholder value derived from the technology is protected.

THE BOURSE WHISPERER: Emerging bauxite exploration and development company, Australian Bauxite (ABx) has received laboratory and exploration results from drilling and surface exploration conducted at the company’s recently-consolidated 11 exploration tenements in Tasmania.

The tenements are situated in central Northern Tasmania and cover some 1,897 square kilometres.

ABx has completed 334 drill holes and 1,521 surface samples in Tasmania over the past 18 months, carefully assessing all results in order to define areas that may be suitable for a bauxite extraction and export project.

The assessments have been based on:

–    Sufficient tonnages of thick, good quality low-silica, gibbsite-rich bauxite;

–    Nearness to high-capacity transport routes linked to nearby mineral export ports; and

–    Being as free as possible of socio-environmental constraints that might prevent investment in a new business in central Northern Tasmania.

As a result of its assessment, the company has decided to relinquish two outlying tenements with the intention of securing another two new tenements in areas of quarrying and cleared lands that contain bauxite.

One new tenement has been offered for grant with a further two applications pending.

Once the company has defined the best resources, it will commence a scoping study, earmarked for September with the anticipation of reporting on the tenements’ economic potential before the end of the year.

 

ABx Tasmanian bauxite tenements, drillhole locations (dots) and infrastructure. Source: Company announcement

 

The company has also flagged the early commencement of discussions with potential offtake customers early to ensure its Tasmanian investment situation is clearly understood.

ABx said that community consultation and expert advice has led to a greater level of confidence that bauxite extraction could be viable in several of these areas once sufficient resources are identified and required approvals obtained.

“Investing in Tasmania is only done after careful consideration of the risk-rewards situation based on expert advice,” Australian Bauxite chief executive officer Ian Levy said in the company’s announcement to the Australian Securities Exchange.

“It requires an understanding of Tasmania’s special circumstances.

“We believe that with goodwill and common sense, Australian Bauxite can develop a viable project in Tasmania.”

ABx said it considered central Northern Tasmania to offer good infrastructure, with an operating rail line passing through the bauxite areas as well as heavy haulage highways.

Both the rail and road link directly to efficient operating mineral export ports at Burnie and Bell Bay that have spare port capacity.

Tasmania has a well-developed electric power grid based mainly on hydroelectric power and has ample water supplies in most areas.

Natural gas from the Bass Strait field is distributed throughout Tasmania and there are many well-established population centres throughout the region.

THE BOURSE WHISPERER: Aviva Corporation has entered into a binding sale and purchase agreement (SPA) with African Barrick Gold (ABG).

The deal will result in the sale of all Aviva’s Kenyan gold and base metals assets for an initial cash payment of $20 million.

ABG is one of the five largest gold producers in Africa and this acquisition represents its first move into Kenya.

The company is majority owned by New York and Toronto-listed Barrick Gold, the world’s largest gold producer.

“This transaction will ensure Aviva has a strong balance sheet providing considerable flexibility to pursue growth opportunities for shareholders,” Aviva Corporation chief executive officer Lindsay Reed said in the company’s announcement to the Australian Securities Exchange.

“The company is actively reviewing its strategic growth options in relation to its coal-based projects in Botswana.

“We believe this is a very good deal for shareholders, Aviva has spent approximately $8 million on its Kenyan project and looks set to generate a substantial return on its investment in less than two years.

“The certainty of cash compared to the dilutionary impact of funding our gold aspirations at the company’s current market capitalisation was a key driver as to why it is in the best interest of shareholders to sell this asset for what is a significant premium in current market conditions.”

The key terms of the SPA are as follows:

–    ABG will acquire all the shares in Aviva Mining Kenya, the company that owns Aviva’s Kenyan assets for $20 million;

–    There is a further payment of $10 million due to Aviva if a National Instrument 43-101 compliant indicated resource of 3 million ounces or more is declared over the project areas;

–    ABG will fund all the costs that Aviva incurs on the Kenyan assets, based on an agreed work program retrospectively from 1 June 2012, until completion of the SPA. This funding is capped at $1million but can be increased with ABG’s approval;

–    In addition, ABG will fund the US$0.1 million for the exercise by Aviva Kenya of its Preliminary Option in terms of the Joint Venture with Advanced Gold. Following the payment of the Preliminary Option exercise price of US$0.1 million, Advanced Gold will grant Aviva Kenya the right to acquire a 51 per cent ownership interest in the mineral rights, owned by Advanced Gold and which are the subject of the Joint Venture Agreement, in consideration for Aviva Kenya incurring further exploration expenditure of US$0.5m in a defined period of 24 months in relation to those mineral rights; and

–    If the SPA does not proceed to completion, other than due to a material breach by ABG, Aviva will be required to repay the funding advanced by ABG under the SPA within 90 days.