Magnetic Resources Building Cosy Retreat at Hawks Nest 9

THE CONFERENCE CALLER: Magnetic Resources (ASX: MAU) is proving to the market that not all major gold producing regions currently occupied by some of the world’s largest mining houses are exhausted from an exploration point-of-view. By Mark Fraser

The Western Australian-based company, which has 261 square kilometres of prospective real estate in WA’s Laverton region and another 213sqkm around Leonora, has made what it believes are a couple of major new gold discoveries in locations which, from all indications, seem to have been mostly overlooked by previous tenants.

First cab off the rank is Hawks Nest 9 (HN9), which sits only 15km north of Gold Fields’ Wallaby mine, 35km north of AngloGold Ashanti’s giant Sunrise Dam operation and 10km north west of Dacian Gold’s Jupiter deposit.

Here, Magnetic Resources’ exploration endeavours have demonstrated significant and coherent mineralisation over a 3km by 200 metre area that is still open and predominantly within the top 50m of cover, thus providing tremendous potential for deeper mineralisation

Within this 3km mineralised shear zone there are many shallow gold intersections, with 240 being greater than 1 gram per tonne, 89 higher than 2 grams per tonne, 44 more than 3 grams per tonne and 32 over 4 grams per tonne. To date, the company has drilled 723 RC holes for 39,740m.

Of particular interest is the Central Thickened Zone, where some thick gold intersections like 104m at 0.82 grams per tonne from 8m (including 20m at 2.23 grams per tonne from 95m) have been encountered.

These thickened zones have multiple stacked shallow dipping lodes similar to those at Wallaby, Jupiter and Sunrise Dam.

According to Magnetic Resources, a new thickened gold intersection of 90m at 0.37 grams per tonne from 80m (including 8m at 2.5 grams per tonne from 80m) was located 600m south of the Central Thickened Zone.

This intercept is only 60m north of another one of 7m at 3.04 grams per tonne from 108m.The areal extent of the mineralisation is growing in the southern direction and remains open both to the north east and at depth.

During the 20th RIU Explorers Conference held in Fremantle, Magnetic Resources’ managing director George Sakalidis said a large drill program of 98 holes for 11,937m was planned mainly to define an indicated resource within HN9 and extend the size of the new Southern Thickened Zone.

Meanwhile, sitting just 1.5km to the east is Lady Julie, where the tenements are strongly mineralised with 101 gold intercepts (1-19m) greater than 1 gram per tonne, including 34 being greater than 2 grams per tonne, 20 more than 4 grams per tonne and 13 over 4 grams per tonne.

So far, the prospect has been subjected to 131 RC holes for 7,196m.

Several of these mineralised zones were similar to HN9 and occurred within altered porphyry and altered porphyry and mafic contacts as well as, in some cases, sediment zones.

During his time at the RIU podium Sakalidis said HN9 – in combination with Lady Julie – represented an exciting large scale near-surface gold deposit.

The shallow gold and adjacent mining operations, he noted, were the unique point of difference for investors.

Ultimately, Magnetic Resources was looking to identify large economic gold deposits of 1 million gold ounces or more using the knowledge of the region’s geology and geophysics garnered by the current producers working there.

After his RIU presentation, Resources Roadhouse asked Sakalidis how was it that new gold discoveries could be made in a well looked over world class mining district (Leonora-Laverton) which had already yielded over 34Moz (mined and resources) and was second only to the Kalgoorlie-Boulder region in WA when it came to yellow metal endowment.

“Other companies that have looked at it obviously haven’t appreciated it or understood it – they haven’t understood it, so we have spent a lot of time and energy trying to understand what it all means,” he replied.

“There was some data (when Magnetic Resources first pegged the tenements), but it needed someone to drill it out to connect it all up.

“So, we went out in the field, and you can see with these old pits (on HN9) that they are only small, but they are also horizontal.

“So, one of the things that we noted was that a lot of the lodes carrying the gold in the large ore bodies are near horizontal. And that wasn’t recognised straight away, so that could be part of the reason. They (previous modern explorers) were looking for these big plunging deposits.

“Basically, HN9 sits on this one thrust plane, and that thrust plane goes down to 2km depth. The length of the thrust is about 4km, so this is a pretty significant stuff.

“These thrusts are bringing the mineralisation up. We can see a set of six thrusts over HN9, and we’ve really only investigated one of them. So fundamentally, now that we have done the seismic, we understand the geometry, and having a thrust plane bring up mineralisation is very significant.”

Sakalidis said Magnetic Resources’ current field program included some passive seismic work, which was being conducted over a much larger grid.

“What we are trying to do is get a pseudo 3D effect,” he explained.

“So, with these thrust zones, we know they occur on this line, but do they go directly north or do they go that way?

“We are trying to work out, by having a 3D effect, if you might be able to trace these going north.

“And that will be very important, because if they do intersect areas that we haven’t drilled, then they become a good target.”

 

 

Polar X Biden its Time on US Projects

THE CONFERENCE CALLER: An Australian explorer with two emerging projects in the US does not expect the recent election of the Joe Biden-led Democrat administration will have much impact on the country’s minerals sector – at least not in the short to medium term. By Mark Fraser

Speaking just before his presentation at the 20th RIU Explorers Conference in Fremantle last week, Polar X (ASX: PXX) managing director Dr Frazer Tabeart said while the new American government had “a broadly different philosophy about mining than the outgoing administration” – meaning there may, across a longer time frame, be some changes “particularly in areas that are federally-controlled rather than state-controlled” – he suggested it would be manageable.

The Western Australian-based explorer has two polymetallic projects in the US – one in Nevada and the other in Alaska. Both states are globally recognised as being attractive mining jurisdictions.

In Nevada, the company is looking for high grade gold and silver in the Humboldt Range, which sits around 200 kilometres north east of Reno.

Here, Polar X has a low cost exclusive agreement to wholly acquire a mine lease agreement over 177 lode claims in two areas – Black Canyon and Fourth of July.

At Black Canyon, these claims have been owned by the same family since 1950 and exposed to limited modern exploration since mining ceased there in 1927.

Located between Argonaut Gold’s 5 million ounce Florida Canyon gold mine and the 400Moz Rochester silver operation (which also contains 3.5Moz in gold credits) owned by Couer Mining, outcropping quartz veins and historical mines show numerous gold assays over 10 grams per tonne, with peak values of a whopping 3,384 grams per tonne gold, 2,837 grams per tonne silver, 22.9 per cent lead and 3.1 per cent zinc being recorded.

Meanwhile at the Fourth of July just to the south, rock chip sampling has returned some pretty interesting numbers, including 3.38, 15.28 and 12.3 grams per tonne gold as well as 23.4, 2,639 and 838 grams per tonne silver.

As it stands Polar X plans to complete its Humboldt Range due diligence and exercise the option by the end of April before immediately starting exploration in earnest, with the aim of generating drill targets by the fourth quarter of 2021.

Over in central south Alaska, the company is looking at two properties covering a combined 261 square km – the wholly-owned Stella and Caribou Dome, where it is earning up to 90 per cent. Both are located around 250km north east of Anchorage.

Prospective for large porphyry copper-gold deposits, field activities at Stella – which has shown the presence of Zackly skarn mineralisation – have returned intercepts like 102m at 0.22 per cent copper and 0,1 grams per tonne gold (with the hole ending in mineralisation) at the Mars prospect. The Zackly Main deposit is now 1km long and occurs along a structure with a strong magnetic gradient.

Sitting just to the south west, Caribou Dome contains high grade volcanic sediment-hosted mineralisation, where prospective drill intersections occur over 800m of strike length.

It is envisaged a mining scoping study for this project will be completed during the third quarter.

When pressed by Resources Roadhouse whether he thought the defeat of former Republican President Donald Trump last November would impact Polar X’s activities, Dr Tabeart said it was unlikely in the short term given mining was such an important part of both Nevada’s and Alaska’s economic make up.

“Having said that, obviously the new administration has a broadly different philosophy about mining than the outgoing one, so longer term there may be some changes – particularly in areas that are federally controlled rather than state controlled,” he said.

“These will likely be very project- and very area-specific.

“Our projects in Nevada are on federal land and are controlled by the Bureau of Land Management, the BLF, but as I said – particularly in Nevada where gold and silver mining is such a massive part of the economy – I don’t think we are expecting to see any changes in the short to medium term.

“And in our case we are very fortunate in that Humboldt Range is very close to existing, fully permitted mines. So if we make a discovery there, we will always have the option of working with existing mines in some form of an operating joint venture so we wouldn’t have to permit something like a new processing plant or a new heap leach.

“I think in the longer term it’s the permitting of things like heap leaches that might get further scrutiny, but I can’t see that impacting us in the next 2-3 years.”

In Alaska, Dr Tabeart said, mining was not subjected to the same environmental concerns as the state’s energy sector given it did not potentially impact fragile ecosystems or face permafrost issues.

“There really shouldn’t be a perception that Alaska is anti-mining – it’s a very pro mining state,” he noted.

“In all of the recent polls that have been taken within industry, Alaska is probably second in the US after Nevada, and that puts it in the top 10 in the world.

“We’ve found everybody in Alaska to be really supportive – in the past the state has had such a reliance on royalties from oil and gas that it really did see the need to diversify its economy, because it’s obviously a risky strategy if you are only relying on one source of income.”

Although the development of one of the world’s giant copper-gold porphyries – Pebble, some 310km south west of Anchorage – was recently stopped after years of controversy, Dr Tabeart said this was not reflective of mining in the state as a whole.

“Pebble is a very specific project – the complexities there are multiple types of land ownership, with private land ownership, state owned and federal native corporation ownership,” he noted.

“The project had a very large footprint potentially, and also it was quite sensitive in terms of the large number of commercial fishing ventures involved, so there was quite a lot of opposition to that – and there had been for 10 to12 years.

“But while that was all been happening a lot of other big projects were permitted, so there has been significant progress over that time.”

In short, Dr Tabeart said, Alaska was “open for business”.

“Of course with every individual project there will be specific issues, but you have just got to manage it, and you have to manage it well from day one,” he added.

“So it certainly can be done.”

 

 

Mount Ridley Mines to Firm-up Weld Range Iron Ore

THE CONFERENCE CALLER: Moves are afoot to size up a portion of what is arguably the biggest deposit in Western Australia’s Mid West iron ore inventory via RC and core drilling at the western end of the ore body. By Mark Fraser

Mount Ridley Mines (ASX: MRD) is set to tackle its Weld Range West project in earnest as it looks to establish an initial 5 to 30 tonnes per annum direct shipping ore (DSO) operation.

The company controls 20 per cent of Weld Range, with its holdings covering four parallel banded iron formations units (BIFs), each with a strike length of over 10 kilometres – including the highly prospective Madoonga and Wilgie Mia formations.

Located around 330 kilometres north east of Geraldton and 60km north west of Cue, Weld Range’s BIFs extend over 60km. The presence of iron ore in the area has been acknowledged by the WA Government since the 1950s.

According to Mount Ridley Mines technical director David Crook, the company initially plans to drill 15,000 metres as it further distinguishes the project’s hematite – which goes down 120m from surface and will make up the DSO – from the magnetite mineralisation beneath it.

While substantial resources of iron ore have been defined in the remaining 80% of Weld Range held by Sinosteel Midwest Corporation and Fenix Resources (ASX: FEX), to date no drilling has tested hematite targets within Mount Ridley’s tenure.

Combined, the Madoonga and Wilgie Mia formations have an average grade of over 62.5 per cent iron.

“We want to do one more round of gravity – to help further distinguish the magnetite from hematite – and once that’s done we will be ready to drill,” Crook told Resources Roadhouse during the recent RIU Explorers Conference in WA.

“We want to define where the hematite-magnetite interface is – plus we want to determine the overall quality of the hematite.

“Weld Range’s hematite tends to be high grade, so we will be looking for material above 60 per cent iron, hopefully 62-63 per cent, and we are after ore with low silica and low phosphorous in particular, but with high iron.

“The plan is to drill down to 200m panels with RC drilling, but if we like what we see we will consider bringing in a diamond rig.”

When pressed on whether Mount Ridley was also interested in mining Weld Range’s underlying magnetite material, Crook said at the moment that was “a step way too far for us”, and suggested that Sinosteel would most likely become the region’s magnetite leading producer.

“Large magnetite projects with their associated processing circuits can cost billions of dollars, whereas with hematite it’s pretty much a case of digging it up, crushing it, putting it on a truck and sending it off,” he noted.

“Plus there’s been no drilling for hematite of any note within our project area – there are a couple of holes drilled for gold, and a couple of holes maybe drilled mainly for magnetite, but the hematite areas have never been drilled.”

Planning for the approaching field work was influenced by a rock chip sampling program that was conducted in 2020, which returned encouraging results between 60.3 and 63.2 per cent iron.

“With the outcropping we consistently got above 60 per cent in our rock chips – and that was over quite long areas,” Crook said.

The company, however is also interested in what is beneath the ground – including big structures that intersect the BIFs, the strike parallel structures as well as the hydrothermal cells where alteration between magnetite and hematite took place.

“A lot of it is undercover, and that might be one of the reasons why people haven’t explored it before,” Crook said.

“For much of the rest of the belt the iron sticks out of the ground. That’s quite visual – whether it is prospective or not. But in our area, some of the prospective material is underground.

“And that bodes well, I think, because often the material which is not prospective is full of silica, and therefore it tends to stick out of the ground because it is quite resistant to weathering.”

The final good news about Weld Range West is the fact the deposit isn’t landlocked – there is a nearby sealed road which will allow the mined ore to be trucked to the Geraldton port.

This Mid West harbour is the same one from which WA’s first iron ore was shipped by Western Mining back in the mid-1960s.

WMC was an active carbon steel materials miner in the region for some 10 years before, presumably, the rapidly growing iron ore industry in the Pilbara further north overwhelmed the domestic sector.

 

 

The Resources Roadhouse at RIU Explorers Conference 2021

THE CONFERENCE CALLER: The 2021 RIU Explorers Conference in Fremantle was once again a great launching pad for the year ahead for the exploration and emerging mining sector.

The Resources Roadhouse managed to catch up with a number of companies attending the event.

 

Neometals Benefitting from Battery Beneficiation

THE CONFERENCE CALLER: There’s no denying Neometals (ASX: NMT) – the self-proclaimed “sustainable investment of choice going forward” – is in a league of its own when it comes to the smaller capped mineral houses listed on the Australian bourse. By Mark Fraser

The multi-pronged outfit has its fingers in a number of pies, with all of them relating, in some way or another, to electric vehicle (EV) and energy storage batteries technologies.

During his appearance at the 20th RIU Explorers Conference held in Fremantle last week, Neometals managing director Chris Reed was fairly selective when it came to discussing his company’s undeniably eclectic project portfolio.

Rather than talk about all five of Neometals’ major endeavours, including an advanced conventional nickel exploration play in its home state of Western Australia, Reed focused on two – both of which involve what could be described as above-ground “deposits” that negate the production of carbon dioxide.

The first was its 50:50 incorporated Joint Venture with the German SMS group GmbH to fully develop, and commercialise, its lithium-ion battery recycling technology, while the second involved its vanadium recovery JV in Sweden with unlisted Scandinavian-focused explorer Critical Metals.

In terms of the former, the WA-based company has developed a process flowsheet (known as LIB Recycling Technology) which targets the recovery of valuable materials from consumer electronic batteries – including devices with lithium-cobalt oxide cathodes as well as nickel‐rich EV and stationary storage battery chemistries containing lithium‐nickel-manganese‐cobalt cathodes.

Ultimately, this technology is designed to recover cobalt, nickel, lithium, copper, iron, aluminium, carbon and manganese and turn them into saleable products that can be reused in the battery supply chain.

A 2019 scoping study, based on earlier bench scale testwork, highlighted robust project economics. Data from the successful pilot program is guiding current demonstration trials as well as engineering and feasibility studies. A demonstration plant is being constructed at Hilchenbach, which sits 100 kilometres from Dusseldorf.

During the RIU show Reed suggested the circuit was not just concerned with battery recycling, but would effectively result in the establishment of a base metals refinery, albeit one that was “hydromet not a pyromet”.

“So we just feed batteries into it – that’s all,” he remarked.

“And we beneficiate them too … these grades will double by the time we put them into a leach circuit.

“We did this in Australia and we are using solvent extraction developed in Mt Isa.

“So, we can take batteries of any format, in any state of charge, we safely process them, take out the plastics, the scrap, the metal and aluminium foils, and we get black mass, which is the graphite anode and the battery materials – nickel, lithium, cobalt, manganese – (and we) dissolve them in sulphuric acid, and sequentially strip them out.

“And why we are focused in Germany is 60 per cent of Europe’s battery making operations will be in Germany, and you’ve got the best car makers there, which is fantastic.

“And we’ve secured, for our first demonstration trial, 25 tonnes of EV batteries from one of the leading German car makers. And at the next trial we will run the stationary energy storage batteries and we’ve got about half the feed for that.”

In terms of the vanadium project, which is also a 50:50 JV, Neometals and Critical Metals are evaluating the feasibility of recovering high purity (over 99.5 per cent) vanadium products from three high grade vanadium-bearing steel by-product stockpiles (slag) in Scandinavia owned by SSAB.

Under the agreement, the ASX-listed company will fund and manage the evaluation activities up to the consideration of an investment decision.

According to Neometals, the deal provides a secure basis for the evaluation of an operation capable of processing 200,000t of slag per annum without the need to build a mine and concentrator like existing primary producers.

Other attractive project attributes include the fact the processing flowsheet uses conventional equipment at atmospheric pressure and mild temperatures and there is potentially saleable by-product generation. In addition, there is the likely possibility of a very low, or net zero, greenhouse gas footprint given the absence of mining and a processing route requiring the sequestration of carbon dioxide.

Reed told RIU delegates that while the process would work using sulphuric acid, that would generate a sulphate tail.

“These guys won’t let you do that – they are all tree huggers and stuff like that in Scandinavia,” he said.

“So we’ve developed a process which is essentially a carbonate leach; like a really super-charged soda water.

“You get about 75 per cent extraction, but the tails are carbonate. And so we will actually sequest 65,000 tonnes per annum of carbon dioxide out of the atmosphere for this project, and given that grade (around 3.93 per cent vanadium pentoxide) it’ll be the lowest cost quartile every day of the week.

“It’s fantastic. It’s not very often that you ever see a project where you’ve got 10 years stockpiled, and these guys are making 240,000 tonnes a year excess on the stockpiles.

“By the time we build it there will be bloody three million tonnes there.

“So, it’s fantastic – I’ve got to say we’ve never been happier with any project we are earning into.”

Reed said Neometals had developed a “fantastic team with a lot of metallurgical and mining skills” that it inherited after developing the Mt Marion lithium project in WA.

“(With) the development and sale of that we’ve given back $55 million in dividends in the last five years (and) we’ve still got $80 million in cash and investments and no debt,” he added.

“What we do and what we present to our shareholders is an unparalleled exposure to this megatrend in these commodities.

“So, we sat back a number of years ago – we got into recycling in 2016 after we started developing Mt Marion because we knew there were better places to be in the supply chain.”

 

Kaiser Reef to Explore NSW via Victoria Mine Restart

THE CONFERENCE CALLER: A decision to effectively re-list shortly after making its debut on the Australian bourse seems to have paid off for Kaiser Reef (ASX: KAU) as it joins the ranks of domestic gold producers. By Mark Fraser

Having established an initially modest cash cow in the form of the A1 mine in Victoria’s Maldon Goldfield, the company is now free to pursue one of its original goals – to go out and explore a prospective chunk of the northern Lachlan Ford Belt (LFB) in New South Wales.

When Kaiser Reef first listed in February 2020, going into NSW was a priority. But shortly after it started trading on the ASX, the company identified what it believed would be a compelling and strategically attractive acquisition.

This was the combined assets of the historic A1 operation, the Porcupine Flat Maldon gold processing plant and four granted mining leases, which Kaiser Reef purchased from administrators after raising $7.5 million during the second half of last year.

First discovered in 1861, A1 had already produced 620,000 gold ounces from ore grading an average of 25.9 grams per tonne by the time Kaiser Reef bought it. First gold was poured by the proud new owner within a week of re-listing during the summer of 2020/21.

Speaking during the 20th RIU Explorers Conference in Fremantle last week, Kaiser Reef executive director Jonathan Downes said as the Victorian operation had no reserves and minimal resources added to its inventory while under administration, building a resource base via exploration was now on top of the company’s to do list.

And there was, he suggested, an opportunity to increase A1’s production rate by the middle of the year by supplementing the current air leg mining through the use of long hole open stoping methods.

“The strategy right now is to continue the current drilling to find some proper reserves and put the company back on its feet after a long period of being in that sort of administration process,” Downes explained.

“It’s going to take us several months to really get the first resources and reserves back into the company. It did have some significant resources – we deleted those because we wanted to start from scratch and have a lot of veracity behind the work that we proceed with now.”

Shortly after the RIU show, Kaiser Reef showed it was serious when it told investors that the latest drilling results from A1 had included gold intercepts like 12.1 metres at 24.26 grams per tonne from 20m and 1.8m at 11.6 grams per tonne from 81.7m.

This second result included a higher grade zone of 5m at 44.3 grams per tonne from 20m and another one of 5.1m at 13.7 grams per tonne – separated by a 0.3m core-loss interval.

Furthermore, the above-mentioned 5m at 44.29 grams per tonne interval contained 1m at 187.25 grams per tonne from 20-21m, which was within a strongly altered dyke (pervasive carbonate and sericite alteration) with disseminated sulphides.

This drilling program, Kaiser Reef said, continued to expand into resource definition for short and medium term production horizons, with around 4,000m to be completed.

Moreover, this would see more drilling at A1 in four months than there had been the three years prior, which in itself was important for the planning and development of an expanded mining operation.

During the RIU show Downes suggested the company was already more-than-happy with its Victorian investment.

“Because we just purchased this project out of administration, we didn’t pay a market price for the asset – we paid what it cost to settle with creditors, deal with administrators and bring this thing back into listing,” he said.

“So we bought something at a non-market price, which is why we have an enterprise value today of less than $35 million which, I may be wrong, but I think that is possibly Australia’s lowest priced operating gold mine.”

While the Maldon acquisition may have re-routed some of Kaiser Reef’s original corporate direction, the company hasn’t forgotten about its NSW LFB tenure, where it has two key exploration projects.

The first, the wholly-owned Stuart Town, is located on the trend just north of Newcrest Mining’s (ASX: NCM) giant Cadia gold copper mine and Alkane Resource’s (ASX: ALK) Boda discovery in the state’s central west, while just to the north west is Macquarie North, where some of the conceptual targets are large scale porphyries, “in areas beyond the belts you see the traditional porphyry mines”.

Downes told the RIU crowd that Stuart Town contained a coincident gravity and magnetic target directly below some gold workings as well as large scale geophysical targets modelled at shallow depth and not yet drill tested.

“Stuart Town may have the densest group of gold workings in NSW, and to say it has been underexplored is an understatement,” he said.

“CRA did do a detailed soil survey there and found some huge soil anomalies.

“We have been out there – we’ve been drilling. And we’ve got gold in every drill hole. We found it was very course gold so a lot more met work is going on trying to work out exactly what that gold is composed of.”

As for Macquarie North, its location at the northern end of the Macquarie Arc augers well given these rocks host some of Australia’s largest copper-gold mines.

Downes said this project contained large scale geophysical targets that were yet to be drill tested.

Obvious mineralisation, he maintained, was being obscured by shallow-to-medium overburden.

“That will probably be the last project we get to – it’s still only at an exploration application stage,” he added.

 

 

Calidus Resources Poised for Pilbara Gold Production

THE CONFERENCE CALLER: Those looking to quell any doubts regarding the potential of Western Australia’s Pilbara region as a future major gold producing hub should look no further than the example being set by Calidus Resources (ASX: CAI) at its emerging Warrawoona project. By Mark Fraser

While a lot of the oxygen in the small end of town gold space is currently being sucked up by the success of WA-based explorer De Grey Mining (ASX: DEG), Calidus has diligently been working its way towards becoming a producer by the first half of 2022.

The company is currently on the path to establishing a $120 million operation with an average production of 90,000 ounces per annum at a life-of-mine all-in sustainable cost of $1,290 per ounce over an initial eight year (and three month) life.

During this time Calidus is planning to mine 17.6 million tonnes grading 1.24 grams per tonne for 702,000oz (with the recovered gold content being 658,277oz).

Meanwhile, the scheduled ore processing rate is 2.4Mtpa (oxides) and 2Mtpa (fresh material) with the average life-of-mine recovery being 94.4%.

The key feasibility outputs, at a gold price of $2,500 per ounce, include an EBITDA of $110 million a year, a post-tax project free cashflow of $447 million, a post IRR of 69%, a post-tax NPV of $286 million and a payback period of 13 months.

Warrawoona currently has ore reserves of 14.3Mt grading 1.2 grams per tonne for 547,000oz, while the company’s total resource inventory sits at 43.7Mt grading 1.06 grams per tonne for 1.5 million oz.

During the 20th RIU Explorers Conference in Fremantle, Calidus managing director Dave Reeves said later this quarter the company planned to release an integration study on the Blue Spec deposit – a super high grade resource containing 219,000oz grading 16.3 grams per tonne – with the intention of bringing it into the current mine plan and increasing production “significantly on an annual basis”.

Located about 70km to the south-south east of Warrawoona, Blue Spec covers a strike length of 8km and remains open down-dip and along strike.

Made up of two ore bodies that is separated along strike by 1km, Blue Spec was mined in the 1970s.

“It is an ore body that requires flotation – we will have a little flotation circuit to the side of Warrawoona, so we will produce gravity gold, a flotation concentrate, and we will then also put the tails through the CIL,” Reeves explained.

“So, we will get about 20-25 per cent of the gold through the Warrawoona gold plant and 75 per cent through concentrate sales – (there is) a very simple circuit in that and one we see as very low risk.

“The scoping study will be out this quarter, the DFS (will be) out around the first gold pour so that when things settle down at Warrawoona we can press the button on this and bring it in as quickly as we can, because you don’t often get 16 gram ore bodies – in fact I think it is the first one I have been involved with, so it has been an absolute pleasure.”

Main construction is set to begin this quarter. Early site works – including the installation of an accommodation village, water bores, communications and access roads – have been completed.

Reeves said he “couldn’t agree more” that the Pilbara was the place to be for an emerging gold producer.

“If you have a look, yesterday Novo (Resources – TSX: NVO) poured their first bar of gold from their Beatons Creek operation at Nullagine to the south east of us, Capricorn (Metals – ASX: CMM) will be pouring gold to the south of Newman later this year, we will be pouring gold early next year, so it is certainly an epicentre of gold development in WA,” he said.

“De Grey is obviously out there kicking goals, and there are a lot of other deposits as well.”

“So it’s a fantastic place to be from the gold perspective.”

 

Carawine Resources Encamped on the East and West Coasts

THE CONFERENCE CALLER: While he didn’t exactly give the game away during his formal presentation at the RIU Explorers Conference in Fremantle, Carawine Resources (ASX: CWX) boss David Boyd does have a couple of favourites when it comes to his company’s five highly prospective Australian exploration projects. By Mark Fraser

While Boyd told Resources Roadhouse he was still pretty much sitting on the fence when it came to Carawine’s extensive and diversified minerals portfolio, he had to admit there were a couple of standouts for him – and they were the first two mentioned during his time at the RIU podium.

The first is the Tropicana North gold project in his home state of WA, where the company has 80 kilometres of strike in the prospective Tropicana Belt some 400km north east of Kalgoorlie-Boulder and is now looking at multiple targets.

Meanwhile, the second is the Jamieson gold-copper-zinc play in Victoria’s south east Lachlan Fold Belt, home of the high-grade Hill 50 gold deposit as well as a number of interesting porphyry targets.

“In the second half of last year we did two deals – one with a combined interest in a couple of granted tenements to the north and south of Tropicana and another deal to give us a big bunch of application ground which – together with the ground Carawine had pegged previously – basically gave us the second largest holding throughout that Tropicana Belt,” Boyd explained.

“And we’ve just finished 100-odd holes there – over December and into January we did around 3,000 metres of RC drilling and 4,000m of aircore.

“It’s a really exciting prospect, so in terms of what’s new and exciting for the company it’s definitely the Tropicana stuff, and we will see those results come through.

“But Jamieson has been bit of a mainstay for us – there’s a gold system there that is good to chase down.

“So they would be the two right now.”

In relation to Tropicana North, Carawine – as 90% partner – formed a Joint Venture with Thunderstruck Investments to take a closer look at, amongst some other prospects, the advanced Hercules and Atlantis targets which, combined, have already returned assays like 3m at 12 grams per tonne from 49m, 10m at 4.02 grams per tonne from 127m, 15m at 21 grams per tonne from 50m and 9m at 5.19g/t from 63m.

Meanwhile, over in north east Victoria, the company has also launched another drilling campaign focusing on the Jamieson volcanics, where it is confident it has found links with the prospective Stavely volcanics (in western Victoria) and Tasmania’s Mt Read volcanics.

Although down-plunge extension drilling at Hill 50 has revealed promising gold-only intercepts like 50m at 3.08 grams per tonne and 101m at 1.44 grams per tonne, other holes have included copper mineralisation as well.

These include 43m at 4.24 grams per gold and 0.3 per cent copper (with 5m at 24.1 grams per tonne gold and 0.4 per cent copper) as well as 67m at 2.94 grams per tonne gold and 0.1 per cent copper (including 11m at 13.9 grams per tonne gold and 0.2 per cent copper).

Another interesting aspect of the Carawine story is the fact it has formed a few JVs with some serious mining houses – with two partners being Rio Tinto (ASX: RIO) and Fortescue Metals (ASX: FMG) at its Paterson copper-gold project in WA’s east Pilbara.

With the West Paterson target, Rio Tinto has farmed-in to the tune of $5.5 million and can earn up to 80% in a discovery.

In the meantime, just to the south east at Coolbro, Fortescue’s $6.1 million farm-in can earn the iron ore miner up to 75% in any ore body found.

“When we did those deals we had already done a bit of our own work, generated targets and lifted them up to the next stage of the exploration process,” Boyd said.

“We then looked at where we could spend our money, which is hard fought for and generously guarded, and thought about where it could be best spent – at where we would get our best bang for our buck.

“So at that time we thought we would be better off concentrating on our other projects and letting the likes of Rio and FMG, who are already active in the area, become involved.

“The outlook here is probably a little longer term, but we’re happy to give away some of the interest in these projects and see these farm-in partners spend the money to advance them.

“Ultimately the outcome of these deals in the Paterson is about $12 million being spent in the ground that we don’t have to find ourselves.”

 

 

Aruma Resources Pitches New Gold Camp

THE CONFERENCE CALLER: Gold explorer Aruma Resources (ASX: AAJ) is living proof the market doesn’t always respond appropriately to the release of a promising set of drill results. By Mark Fraser

On the day the company’s managing director Peter Schwann spoke at the RIU Explorers Conference in Western Australia, Aruma had just published the initial assay results from 37 of a 40 hole 4,518 metre maiden RC drilling program at its Saltwater gold project in WA’s Pilbara.

On face value this all should have generated some investor interest for the company.

For a start 14 out of 37 holes hit anomalous gold (over 0.2 grams per tonne), while the results extended over a 4 kilometre strike length (which was open in all directions), indicating the presence of a possible new gold camp.

Furthermore, according to Schwann, a supergene gold blanket in excess of 200m in width was identified.

In addition, the results confirmed the Saltwater anomaly, returned assays of up to 1.26 grams per tonne and validated the outcropping Saltwater ring structure, which in turn highlighted a target area of 65 square kilometres.

The market, however, did not seem bullish, with Aruma’s share price dropping from 0.094 to 0.074 cents – a fall of 21.28 per cent.

“Now the question I have to ask is: why do we want to do greenfields exploration?” a seemingly perplexed Schwann asked RIU delegates.

“We put out good results this morning and bang – down we go.

“But the rewards are great. They’re there, De Grey and Chalice prove it.

“So that’s the rant – the rant is over.”

Aruma’s close-spaced drilling targeted old workings at the historic Saltwater mining area within the recently identified and prospective Mt McGrath Formation, host of the Mt Olympus gold mine.

Meanwhile the wider-spaced holes aimed at the extension of the contact and structure under cover some 3km to the east.
Aruma told the ASX that the supergene blanket was located almost 4km from the Saltwater cluster and highlighted the potential for a significant system – with the intersection of 4m at 0.47g/t in hole SRC 32.

Saltwater has eight granted exploration licences covering 736 square km. It sits around 100km south west of Newman and enjoys a strike extent of more than 65km of the highly significant Nanjilgardy Fault, the same regional structure reported as the primary source of gold mineralisation at Northern Star Resources’ (ASX: NST) Paulsens gold mine and Mt Olympus.

Despite the confused reaction from the market regarding the Saltwater drill results, Schwann still made his case for Aruma being an investment destination just before he stood down from the RIU podium.

The company, he said, offered organic growth via project generation for large gold discoveries in Australia.

It also wholly-owns large prospective project areas near major gold deposits in underexplored areas in both WA (Saltwater, Melrose and Scotia South) and New South Wales (Capital) that combined cover 1,572sqkm.

In addition the junior is debt-free and has $3 million in cash and receivables.

Just as important, though, is the fact Aruma does not plan to idly sit around.

“We’re going to be drilling, drilling, drilling,” Schwann said.

“And the good thing about our money is that we spend our money one and a half times.

“These are the R and D returns that we have got back since I took over in 2011 ($9,570,754, or a 43.8% return, creating a tax benefit of $4,189,894), so you can see we’ve got about $4 million – about the same as a float.”

 

 

AuTECO Minerals Revitalising Pickle Crow

THE CONFERENCE CALLER: Canada-focused AuTECO Minerals (ASX: AUT) wants to make one thing clear – it is not just revitalising an historic gold mine at its Pickle Crow gold brownfield project in Ontario, but is on the verge of establishing a major new gold camp. By Mark Fraser

The Perth-based company is now in the process of updating the project’s resource inventory and is looking to have new numbers in place sometime during the second quarter of 2021.

It plans, however, to also devote part of its current drilling campaign towards looking for further regional targets based on encouraging historical data.

The project, which sits 400 kilometres north of Thunder Bay in the Canadian province of Ontario, clocked up historic production of 3.1 million tonnes grading 16.1 grams per tonne for 1.05 million ounces between 1935-1966.

Although the company is encouraged by the drilling results coming from within the proverbial shadow of the headframe, regional assays have suggested there is more in the area than has previously met the eye.

During his appearance at the 20th RIU Explorers Conference in Fremantle, AuTECO chief operating office Darren Cooke said it was important to note that limited systematic exploration had taken place outside of the immediate Pickle Crow mine area which had revealed broad camp-scale mineralisation and compelling walk-up discovery targets.

Although previous work had shown structures parallel to the main Core Mine shear contained indications of significant gold mineralisation, limited follow-up activities were completed.

Some of these historical regional gold intercepts included 1.7 metres at 36.6 grams per tonne from 15.1m (Springer Shaft), 4.6m at 9.3 grams per tonne from 27.1m, (F Vein), 6.1m at 7.3 grams per tonne from 86.6m (SW Powerhouse) and 6m at 7.7 grams per tonne from 232m (East Pat Shear).

So far AuTECO has completed almost half (around 20,000m) of its 45,000m drill campaign and currently has four rigs on site. Cooke said it was now trying to procure a fifth one to up the field ante.

As it stands the company has already established a resource of 2.8 million tonnes at 11.3 grams per tonne for 1 million ounces.

Its tenure covers 496 square kilometres with 106 patented mining claims, with the regional exploration focus being on the Pickle Lake Greenstone Belt and Sioux Lookout.

Importantly, the project boasts on-site surface and below ground infrastructure including three main shafts, 38km of lateral development, a 225 tonne per day processing plant, a 24 person camp, a 600 kilowatt generator as well as a core processing facility.

In addition it is grid-connected to hydropower.

Cooke said he sometimes referred to Pickle Crow as the “Kundana of Canada” as the project contained numerous analogues to other stand-alone deposits that had been discovered on parallel trends – including the Kundana camp in WA, which has yielded over 9 million gold ounces.

Aside from the fact they are both the same deposit type (Archean orogenic vein), Kundana also has similar host rocks (a mafic sequence with interflow sediments proximal to conglomerates), structural architecture (a multi-phase history with sub parallel shear zones and Riedel shear geometrics) as well as similar mineralisation (both are high grade narrow vein low sulphide quartz-carbonate-scheelite veins with a predominantly steep dip).

Cooke also noted that Pickle Crow was second on a list of emerging tier-1 exploration properties in North America and Australia which have over 1 million ounces in resources, but no reserves.

The first is dual-listed international mining giant Barrick Gold Corporation’s (TSX: ABX; NYSE: GOLD) REN project in the US state of Nevada, which currently contains 1.65 million oz at a resource grade of 13.4 grams per tonne.