Not Just Any Old Iron

There has been plenty of column space across industry media devoted to the unfortunate tailings dam disaster suffered by Brazilian iron ore giant Vale.

There has also been an equal amount of column space dedicated to how our domestic iron ore titans of BHP, RIO and FMG would be the beneficiaries of the tragedy, given that iron ore customers worldwide would need to tap them to fill the shortfall.

Throw into that mix the affects of a recent cyclone on RIO’s Western Australian operations and the global stockpile just got a touch smaller.

What hasn’t received too much attention, is that there are plenty of junior companies with reserves of iron ore that only need to push a button to get their operations up and running and profitable.

Case in point: Venture Minerals (ASX: VMS) and the company’s Riley DSO iron ore mine in Tasmania.

Venture Minerals launched a review of the Riley mine earlier this year on the back of the recovery in the iron ore price, and after receiving expressions of interest by several third parties in the Riley ore.

Venture has had the Riley iron ore mine on care and maintenance since August 2014, before which the company had completed extensive pre-production work having already put in place all the necessary requirements to commence mining.

This means the Riley was then and, more importantly, is now a ‘quick to market’ opportunity for the company.

The current state of the iron ore market and price metrics are favourable to a start up at Riley and any further increase in the iron ore price and/or a decrease in the AUD/USD exchange rate will only further improve the economics of the project.

A quick, back of the envelope, sketch of the Riley project highlights its potential.

Riley is a fully permitted iron ore mine that is positioned to recommence operations reasonably quickly with approximately 90 per cent of the equipment Venture had previously purchased still on site.

The project hosts Reserves of 1.8 million tonnes at 57 per cent iron with low impurities within a DSO deposit that is situated all at surface and located less than two kilometres from a sealed road that accesses existing rail and port facilities.

“The previous work we carried out at the Riley iron ore mine has placed Venture in a strong position,” Venture Minerals managing director Andrew Radonjic told The Resources Roadhouse.

“Should the market continue to tighten, and the iron ore price continue to improve, that just provides the company the ideal opportunity to commence production with relatively short notice.”

The added benefit of bringing the Riley project on stream is that although it has a short minelife it is anticipated to generate anywhere from $20 million to $40 million, depending how the iron ore price travels.

Such a healthy cash injection will mean that Venture will not need to tap the market for the funds required to conduct development work on its 100 per cent-owned Mount Lindsay tin and tungsten project, also in Tasmania.

Venture rates Lindsay as being one of the world’s largest undeveloped tin projects that is placed to take advantage of the recent rise in both interest and the price of tin.

Tin is a vital element of modern-day technology due to its ability to make lithium-ion batteries last more than three times longer to meet the anticipated demand for better batteries in mobile phones, cameras, iPads and other mobile devices and the feverishly advancing hybrid and all-electric car market.

The 148 square kilometre Mount Lindsay project sits between the world class Renison Bell tin mine, which has produced more than 231,000 tonnes of tin metal since 1968, and the Savage River magnetite mine that has operated for over 50 years and currently produces approximately 2.5 million tonnes per annum of iron pellets.

Since acquiring the project in 2007, Venture has defined high-grade JORC-compliant Measured, Indicated and Inferred Resources of 4.7 million tonnes at 0.4 per cent tin and 0.3 per cent tungsten with over 60 per cent in the Measured and Indicated categories.

Venture Minerals recently engaged UTS Geophysics to conduct a high-resolution Airborne Electromagnetic (EM) survey using its VTEMTM Max system over the entire Mount Lindsay project, with the aim of identifying further high-grade tin targets, especially those with the potential to host Renison Bell style mineralisation.

Venture’s previous exploration at Mount Lindsay has identified potential tin targets located within the carbonate units and potentially the same fault zone (Federal-Basset Fault) that hosts the Renison mine, just 12kms along strike to the southeast.

As Renison is a major Skarn, carbonate replacement, pyrrhotite-cassiterite style deposit, Venture considers the VTEMTM Max system to be the best exploration tool for making discoveries of Renison style tin mineralisation at Mount Lindsay.

The company is hopeful the EM survey will generate drill targets that lead to further tin discoveries.

The company is continuing to advance the recently commissioned Underground Scoping Study at Mount Lindsay.

The study is focusing on the previously reported high-grade Resources of 4.7 million tonnes at 0.4 per cent tin and 0.3 per cent tungsten and will be looking to leverage on the earlier Feasibility Study.

“There has been quite a lot of work carried out to advance the scoping study we have underway at Mount Lindsay,” Radonjic said.

“We could get Mount Lindsay into production reasonably quickly given that much of the work we have used for the scoping study is from the previously completed feasibility study.”

Venture Minerals is considering an underground mining scenario for Mount Lindsay.

The company believes an underground operation would lower its environmental footprint and the associated environmental risk and possibly reduce its capex from around $200 million to closer to $50 million.

The flowsheet changes would include a much smaller and simpler plant, processing a higher-grade primary-source tin ore body.

In other words, a project that is more permittable and more fundable, operating in a more ethical environment than where a large portion of the world’s tin currently comes from.

Although it is currently concentrating on the Tasmanian assets within its portfolio that are more towards near-production, the company’s Thor project is making rumblings as an ideal candidate for a Joint Venture.

The Thor prospect is situated within Venture’s 281 square-kilometre Southwest tenement package in Western Australia.

Venture’s latest drilling at the Thor prospect intersected further massive sulphides with copper and zinc mineralisation.

The company has interpreted results from the last two holes drilled to suggest it is vectoring in towards higher-grade zones within the Thor Volcanogenic Massive Sulphide (VMS) sequence.

Drilling at Thor remains sparse with only two single drill holes drilled to date targeting two of thirteen priority VMS drill targets delineated around the initial discovery area.

The company hopes further drilling will unlock the potential of Thor’s 20km VMS target zone.

In this second drill campaign, drill hole TOR05 intersected massive sulphide zones of up to 2.4 metres (271.45m to 273.85m) and returned assays of up to 0.8 per cent zinc and 0.5 per cent copper and highly anomalous cobalt of up to 435ppm, confirming the prospect’s VMS style of the mineralisation.

Thor has the same EM and geochemical signature as the adjacent VMS Kingsley discovery of international mining company Teck, which is one of several VMS occurrences in the Archean Yilgarn Craton of Western Australia.

“We have been greatly encouraged by these latest results from our drilling program underway at Thor,” Radonjic said.

“We are really looking forward to unlocking the potential of the VMS project to deliver high-grade mineralisation in the near future.”

 

Email: info@ventureminerals.com.au
Web: www.ventureminerals.com.au

Directors: Mel Ashton, Hamish Halliday, Andrew Radonjic, Dr Stuart Owen

 

Galan Lithium Animates The Life of Brine

With potential world-class projects in one of the hottest lithium jurisdictions globally, cash in the bank and a handful of exceptional exploration results under its belt, things are certainly looking promising for Galan Lithium Limited (ASX: GLN).

The Argentina, lithium-focused minnow wholly-owns six projects covering around 25,000 hectares, with potential lithium brine coverage conservatively comprising around 7,800 hectares, in South America’s Lithium Triangle on the Hombre Muerto salar in Argentina.

Straddling the northwest corner of Argentina, northern Chile and southwest corner of Bolivia, the Lithium Triangle hosts the world’s largest reserves of lithium and around 60 per cent of world’s annual production of lithium, the bulk of which lies in the Atacama salar in Chile and Hombre Muerto salar in Argentina.

Hombre Muerto – which lies in the northwest corner of Argentina – hosts the highest grade and lowest impurity levels of lithium in the country and is the second best salar in the world globally for lithium brine production after Atacama.

Galan believes its landholding in the Hombre Muerto has the potential to host a substantial lithium deposit.

Its six projects – Rana de Sal, Deceo, Catalina, Peta Pila, Santa Barbara and Candelas – are all strategically located in the salar, boarding some of the biggest names in the lithium brine space globally.

The Sal de Vida project – owned by ASX-listed Galaxy Resources with a market cap of $750 million – is regarded as one of the world’s largest and highest quality undeveloped lithium brine deposits.

Galaxy recently sold off the northern portion of the project to POSCO – market cap $30 billion – for a cool US$280 million.

To the west of Sal de Vida lies recent New York-listed Livent Corporation’s Fenix operation which has been in production for over 27 years.

Importantly, Galan has a wealth of experience on its board: managing director Juan Pablo Vargas de la Vega has over 15 years’ experience in ASX mining companies, stockbroking and private equity firms and was a specialist lithium analyst in Australia.

He also has operated a private copper business in Chile and has worked for BHP, Rio Tinto and Codelco.

Priority target – Candelas

Priority target, Candelas, lies adjacent to Sal de Vida and encompasses an approximately 15km long by 3-5km structurally controlled basin, infilled with sediments hosting the brines.

According to Galan’s interpretation of CSAMT (Controlled Source Audio‐frequency Magnetotellurics) surveys, the project showed “…very conductive and shallow units that are compatible with units being saturated with brine, which constitute a great potential for lithium exploration.”

With the geophysical results defining the brine potential, Galan set about planning a maiden drill program to test the geophysical model as well as detailed data on the stratigraphy within the Candelas channel.

After getting the greenlight from the Argentinean government, Galan kicked off a five-diamond hole program in January to test the 12-15-kilometre extent of the Candelas channel.

Results so far from the program have sent tongues wagging in the minerals investment community.

Living up to the hype

Drilled immediately to the southeast of the Hombre Muertos salar, Galan’s maiden hole (C-01-19) certainly lived up to the company’s expectations.

The hole hit a substantial intercept of brine from depths of approximately 200m metres to the end of the hole (401m).

An exceptional high-grade intercept of 192m at 802mg/I Li was returned.

Importantly impurities (magnesium and sulphate) were very low and similar to those observed nearby at the Fenix and Sal de Vida operations.

The maiden hole results sent Galan’s share price skyrocketing to an all-time high of 68 cents in early March 2019.

With their tails in the air, Galan quickly set about drilling their second hole some 9.5km south of the maiden drillhole and located on geophysical CSAMT line 4.

The hole, unfortunately, didn’t quite live up to its predecessor.

While geology was largely similar to that observed in the maiden drillhole, the tectonic basin in the area was much deeper, perhaps up to around 750m, than in the north where C-01-19 was drilled.

Assay results from the hole confirmed field observations that a lower grade lithium bearing aquifer was intercepted.

The lower values were a result of heavy dilution from hydrothermal waters being sourced from an adjacent deep-seated fault zone.

Nearby fumaroles observed at surface supported this interpretation.

C-02-19 was eventually completed to a depth of 662m with basement encountered at 632m.

Third time’s a charm

Despite this slight setback, Galan remained optimistic that Candelas hosted a large lithium resource.

“Much has been achieved to date in a short time frame,” Vargas de la Vega said.

“We are dealing with a unique geological setting for lithium brines and our knowledge of the region increases with the more work we do.

“The lithium potential remains strong for Candelas as it does for our prospective Western tenements at Hombre Muerto.”

Galan quickly set about drilling its third hole (C-03-19) at Candelas, this time 2.5km south of its highly successful maiden hole.

In what was a great relief for the company, the hole intercepted highly conductive brines over around 154m from 276m to the end of hole (430m).

“The discovery of further brines within the Candelas channel reinforces our view that the project has the very real potential to host a significant lithium resource in one of the world’s premium salars at Hombre Muerto,” Vargas de la Vega said.

Downhole geophysics indicated highly conductive and high Specific Gravity (SG) brine was still being encountered to the bottom of the hole resulting in the hole being further deepened to a final depth of 454m.

Several packer tests were performed using the downhole data as guidance which indicated a preferred section from 313m to 454m with conductivities in excess of 200mS/cm and SG readings approximately 1.19 g/cm3.

The rig has now been moved around 3km south of C‐03‐19 and 5.3km south of drill hole C‐01‐19 on CSMAT Line 3 where it has begun drilling the fourth hole.

Galan is also seeking permits from Catamarcan authorities for further drillholes at Candelas beyond the initial five holes approved.

Cashed-up

Shortly after announcing the positive results from its third drillhole in April, the company set about raising $4 million at 27.5 cents per share to fund its ongoing drill campaign at Candelas and start initial resource work.

The share placement received strong support from Australian and North American professional and sophisticated investors.

“We are pleased to have received such strong support from a range of Australian and North American investors, who now join our existing shareholders in aligning themselves to the success we are looking to achieve through our ongoing exploration at the Hombre Muerto lithium project,” Vargas de la Vega said.

“We have achieved positive results to date, which we plan to expand through well planned exploration activities.”

Looking ahead

With significant results under its belt so far from its maiden drill program at Candelas and a $4 million boost to its coffers, Galan is fast tracking exploration with a potential resource estimate targeted for third quarter 2019.

Lithium demand has jumped since 2015 fuelled by the spike in demand for lithium batteries in electric vehicles with current prices around the $US12,550 per tonne lithium carbonate equivalent (LCE).

This demand is only expected to increase with the number of electric vehicles on the world’s roads set to triple by 2020, placing further upward pressure on prices.

 

Email: admin@galanlithium.com.au
Web: www.galanlithium.com.au

Directors: Nathan McMahon, Christopher Chalwell, Terry Gardiner, Juan Pablo Vargas de lea Vega

 

BC Beckons Blackstone Minerals

As the snows melt in the Canadian province of British Columbia (BC), Australian exploration play Blackstone Minerals (ASX: BSX) looks to re-commence field activities at the company’s BC cobalt project.

The company’s attention will be focused on the impressive copper, gold and cobalt targets it identified by way of a soil sampling program previously undertaken on the project.

“We will be commencing our northern hemisphere exploration season in May once the snow starts to melt allowing us access to the ground,” Blackstone Minerals managing director Scott Williamson told The Resources Roadhouse.

“We have a good number of targets at the BC cobalt project that we are keen to start testing.

“Besides the Little Gem target we have identified another, sitting between Little Gem and the previously identified Erebor target, that we feel demands attention.

“We have already encountered high-grade gold and cobalt at Little Gem and at Erebor, so we feel the new target is very interesting and well worth a look.

“Besides these, we also have the Jewel prospect, which is a very big target that we consider having a lot of potential.”

Blackstone has not even had to park the drill rig at Jewel for it to be gathering some attention from astute market watchers.

Basically, the company didn’t have to do anything, thanks to the heavy lifting done by industry heavyweight, Newcrest, which recently made news with a $1.14 billion acquisition for a 70 per cent Joint Venture stake in the Red Chris mine of Toronto-listed Imperial Metals Corp.

Newcrest is no stranger to extracting maximum gain from low-grade, porphyry systems, it has been doing it with a fair rate of success for some time at the Cadia mine in New South Wales, one of the world’s biggest gold mines – after copper credits – that has similar low-grade Resources to Red Chris.

Newcrest mines Cadia at a rate of 30 million tonnes per annum, producing 240,000 ounces of gold – just in the December 2018 quarter alone.

Red Chris has Measured and Indicated Resources of 1 billion tonnes at 0.35 per cent copper and 0.35 grams per tonne gold.

These grades are the norm for BC-style porphyries and, although they may seem low-grade, they are akin to what is being mined by Newcrest at Cadia.

Newcrest has gone into the deal, and the district, with eyes wide open, knowing it has the expertise to make such deposits work and providing plenty of encouragement for others to follow suit.

“The Newcrest deal has really changed our view of the Jewel prospect, as we believe it has similar geology to Red Chris,” Williamson said.

“The Jewel target has potential to be associated with a copper-gold porphyry with cobalt.

“That deal has now put British Columbia copper-gold porphyries on the map.

“To establish such a project does require large capex; however, once underway they practically print money over a twenty to thirty-year mine life.

“We don’t know whether we have one…yet, but there is a chance we could have.”

Blackstone’s 2018 field work at the BC cobalt project consisted an extensive soil sampling program that identified several copper-gold-cobalt targets.

The program resulted in the identification of the Jewel copper-gold-cobalt prospect, located 1.1 kilometres north-northeast of the project’s original focus, the Little Gem prospect.

The new soil anomalies are greater than 1.5km long and coincide with IP targets, indicating a possible large sulphide bearing body at depth.

These copper, gold and cobalt soil anomalies are located within a structural setting near the contact between the granodiorite and serpentinite, that Blackstone considers to be analogous in geological setting to the deposits of the Bou-Azzer primary cobalt district in Morocco.

“We consider there to be forty-eight kilometres of that particular geology that delivered the Little Gem target,” Williamson explained.

“We have only tested one target – Little Gem – out of the entire belt at this stage.

“The key target that has now emerged for testing is the Jewel copper-gold-cobalt prospect.”

Surface rock chip samples taken at the Jewel prospect returned grades of up to 5.6 per cent copper and 5.1 per cent copper.

The BC project took further shape with the discovery of the Erebor cobalt-gold discovery, located 900 metres along an interpreted ultramafic trend to the south-west of the historic Little Gem adits.

Results from surface rock chip samples taken from the Erebor discovery returned assays recording grades of up to 2.3 per cent cobalt and 32 grams per tonne gold.

High-grade cobalt assays from surface rock chip samples taken from the Erebor discovery included:

2.3 per cent cobalt, 32 g/t gold and 1.1 per cent nickel;
1 per cent cobalt;
1 per cent cobalt;
0.6 per cent cobalt;
0.6 per cent cobalt;
0.5 per cent cobalt; and
0.4 per cent cobalt.

These were complemented by high-grade gold and copper assays recorded from surface rock chip samples from Erebor, including:

16.7 g/t gold and 1.6 per cent copper;
10.4 g/t gold; and
1.5 per cent copper.

Blackstone claims Erebor as the first discovery of significant cobalt-gold mineralisation in the region since prospectors discovered similar mineralisation at Little Gem in the 1930s.

The company believes the Erebor discovery further suggests the potential for the BC project to host multiple deposits, akin to the Bou-Azzer primary cobalt district in Morocco.

Blackstone remains encouraged by the fact there has been very little modern-day exploration undertaken across the BC cobalt project since the activities carried out by the early prospectors at Little Gem.

Even since then, the main activities have involved airborne geophysical surveys (including magnetic, radiometric and electromagnetic (EM) surveys) in the 1970s and a further two drill holes completed in 1986.

The mineral occurrence at the Jewel prospect supported some gold production from 1938 to 1940.

Although Blackstone Minerals’ southern hemisphere winter focus is on the company’s BC cobalt project, it also has the emerging Silver Swan South gold project, located eight kilometres along strike of the five million-ounce Kanowna Belle gold mine near Kalgoorlie in Western Australia.

The Silver Swan South project comprises one exploration licence application E27/545 and six granted prospecting licences, P27/2191 – 2196 covering an area of 47.2 square kilometres and are located approximately 40 kilometres northeast of Kalgoorlie.

Results from Blackstone Minerals’ 2018 drilling campaign at the Silver Swan South gold project produced several encouraging results.

The company’s second phase aircore drilling program at Silver Swan South demonstrated its potential as being an emerging gold discovery hosting extensive gold mineralisation and basement geochemical anomalism.

The basement geochemical anomalisms at the Black Eagle deposit as well as at the Black Hawk prospect are located along the interpreted extension of the Fitzroy Shear Zone, which hosts the Kanowna Belle gold mine.

The drilling encountered gold mineralisation and extensive basement geochemical anomalism at the Black Eagle prospect, providing a result of:

SNAC070
10 metres at 3.2 grams per tonne gold from 68m within 15m at 2.2g/t gold from 64m to end-of-hole (EOH).

On the back of this result, Blackstone was able to promote the Black Eagle prospect to priority drill target status.

Blackstone Minerals remains keen to identify the extent and source of the gold mineralisation at Silver Swan South, and to follow-up results of surface sampling of the target ultramafic unit that previously confirmed the presence of nickel sulphides (pentlandite).

“When we originally acquired this ground, we actually did so for its nickel potential,” Williamson said.

“This is the project the company originally listed on, because we liked what we saw in terms of nickel sulphide potential, so we are now going to revisit that nickel sulphide potential.”

Email: admin@blackstoneminerals.com.au
Web: www.blackstoneminerals.com.au

Directors: Hamish Halliday, Scott Williamson, Andrew Radonjic, Steve Parsons, Michael Konnert

 

Full Ownership Provides Advancement Incentive

Alliance Resources (ASX: AGS) recently moved to 100 per cent-ownership of the company’s Wilcherry project in South Australia and has signalled it intends shifting up a gear in advancing the Weednanna gold deposit.

The company recently moved to 100 per cent-ownership of the Wilcherry project, acquiring the final percentage of the project from Tyranna Resources, greatly improving its ability to advance Weednanna on its own terms.

The deal eliminates the administrative burden and costs associated with operating a joint venture and will streamline the future statutory approvals required at the time Alliance submits a Mining Lease Proposal in respect of the Weednanna gold deposit.

Alliance is the latest in a line of suitors, dating back to the 1970s, eager to explore the project, located within the Gawler Craton, northern Eyre Peninsula, 40 kilometres north of Kimba in SA.

The project’s previous owner was Trafford Resources, which had acquired the project in 2006 from Aquila Resources, which had earlier acquired the project tenements to explore for IOCG deposits like Olympic Dam.

Trafford, along with IronClad Mining Limited, made a substantial investment on the project, however their efforts were mostly aimed at defining iron ore, Direct Shipping Ore (DSO) to be precise, in magnetite skarns, banded iron formations and near surface iron oxide deposits.

Trafford made inroads, establishing Mineral Resources totalling 224 million tonnes at 28.8 per cent iron in seven deposits, with 2.9 million tonnes at 55.5 per cent iron being either DSO or Dry Magnetic Separation product.

With the iron ore price enjoying some time in the limelight at present, it is well worth noting these Resources.

Likewise, the 2012-13, drilling programs carried out by IronClad to test an outcrop of high-grade hematite at the Zealous prospect, 13 kilometres northeast of Wilcherry Hill.

This drilling intersected high-grade tin (cassiterite) – which followers of the current electric vehicle debate would know to be a critical element in the manufacture of lithium-ion batteries.

The best intercepts from these programs returned:

12ZLRC007
7 metres at 3.28 per cent tin from 52m; and

13ZLRC001
5m at 2.29 per cent tin from 128m in.

Alliance Resources has approached Wilcherry from another angle, concentrating on what the company considers to be its substantial gold potential, and to date the company has increased both the project’s known mineralisation and potential.

At the time of writing the company was close to completing a Scoping Study to assess the commercial viability of establishing a standalone mining and processing operation at Weednanna.

In September 2018, Alliance Resources announced a maiden Mineral Resource estimate for the Weednanna gold deposit, part of the Wilcherry project, of 1.097 million tonnes at 5.1 grams per tonne gold for 181,000 ounces.

Alliance has always been confident in there being potential to increase the size of this Mineral Resource with further drilling, given many of the gold shoots comprising this mineral resource are open in at least one direction.

Alliance completed a 23-hole round of reverse circulation (RC) drilling at the Weednanna gold deposit in February this year to test for extensions of gold mineralisation in the southern area of the deposit at Shoots 4, 5E, and 11.

The drilling stayed on script, with results from this drilling program continuing to grow the size of the Weednanna deposit outside of the Maiden Mineral Resource area.

High-grade gold was encountered near the southern end of Shoot 4, returning intersections of:

19WDRC017
2 metres at 46.8 grams per tonne gold from 101m; and

19WDRC020
3m at 9.7g/t gold.

The drilling also continued to provide greater clarity at shoot 5E, returning intersections of:

19WDRC004
3m at 6.9g/t gold from 106m;

19WDRC007
10m at 7.7g/t gold from 117m, including 7m at 10g/t gold from 118m; and

19WDRC010
2m at 19.9g/t gold from 77m.

The gold potential of Shoot 11 was clearly demonstrated by intersections of:

19WDRCC012
3m at 7.3g/t gold from 97m (hangingwall); and
12m at 2.5g/t gold from 108m, including 8m at 3g/t gold from 108m;

19WDRC013
16m at 3.7g/t gold from 134m, including 10m at 4.3g/t gold from 134m;

19WDRC022
1m at 19g/t gold from 77m (hangingwall); and
7m at 4.5g/t gold from 90m.

Alliance originally identified Shoot 11 in 2018 while carrying out 3D modelling of the geology of the Weednanna deposit.

This shoot is positioned near the footwall contact of the Paleo-Proterozoic calc-silicate and magnetite skarn and was initially defined on two 25-metre spaced cross-sections by assay results including:

97WDRC010B
4m at 3.6g/t gold from 102m; and

18WDRC016
9m at 2.3g/t gold from 163m.

During December 2018, Alliance completed the first targeted holes into this shoot that returned:

18WDRC064
11m at 1.3g/t gold from 97m;

18WDRC065
7m at 1.5g/t gold from 112m; and

18WDRC066
2m at 16.1g/t gold from 126m.

The recent drilling program has followed suit by hitting further major gold intersection that not only extended Shoot 11, but identified connection to Shoot 9, which is in the same geological position.

Shoot 9 had also previously come to the company’s attention when it reviewed historic drill intersections that showed results from Shoot 9, included:

98WDDH004
7m at 1.5g/t gold from 163m;

98WDRC022
3m at 1.5g/t gold from 58m; and

98WDRC030
3m at 3.2g/t gold from 188m.

The upshot from the latest drilling results Alliance has received from Weednanna is that they have confirmed that, as evidenced at Shoot 4, substantial gold mineralisation can occur near the footwall contact of the Paleo-Proterozoic calc-silicate and magnetite skarn, and that lower grade gold zones can act as a vector towards higher-grade gold mineralisation.

Historically there has been a limited amount of drilling carried out at the footwall contact of the skarn, meaning it remains poorly tested.

Alliance is of the opinion that there is plenty of potential there to discover further gold in this geological position.

The company has plans to keep the drillbit spinning at Weednanna with ongoing RC drilling programs planned to continue to grow the size of the deposit, kicking off with the next phase of drilling expected to commence during April.

Alliance had prior carried out a Three Dimensional Induced Polarisation (3DIP) survey at the Weednanna gold deposit, to help target further areas of mineralisation.

Results from the 3DIP survey observed gold mineralisation is closely associated with chargeability bodies that exhibit moderate to high chargeability and that these chargeable bodies extend deeper than 200m below the surface.

It also demonstrated there to be a strong correlation between high density, high chargeability and high gold concentrations at Weednanna.

The 3DIP survey defined nine target zones based on where the high chargeability zones correlate with high density zones and are near, or along strike from, known high-grade gold shoots Alliance had delineated through its numerous drilling programs.

Five out of the nine targets are shallow, which the company believes highlights the remaining near-surface potential to substantially grow the mineral resource.

So, what the 3DIP survey produced was a chargeability model that closely correlates with underlying geological detail/mapping and known gold mineralisation at Weednanna.

It deemed that many of the targets appear to correlate with the margins of the known gold shoots and some have clear structural control observed in aeromagnetic and gravity datasets.

The highly chargeable zones from the 3DIP surveys also correlate well with high density zones identified by a detailed 3D gravity inversion model the company had generated in 2018 that suggested, like the recent drilling, there is clear potential for further discoveries at deeper levels than have been currently tested.

 

Email: info@allianceresources.com.au
Web: www.allianceresources.com.au

Directors: Ian Gandel, Tony Lethlean, Steve Johnston

Gilmour Gold on Gold Road Horizon

THE INSIDE STORY: As the highly-anticipated Gruyere gold mine moves closer to commissioning, Gold Road Resources (ASX: GOR) is making exciting progress at the company’s 100 per cent-owned Gilmour deposit.

Gold Road Resources and its 50:50 Joint Venture partner Gruyere Mining Company Pty Ltd, a member of the Gold Fields Limited group, have made steady progress on construction and commissioning for the Gruyere gold project, located approximately 200 kilometres east of Laverton in Western Australia.

Late last year, the JV announced an updated mine plan for Gruyere based on updates and enhancements to the Feasibility Study (FS) that had been completed by Gold Road back in 2016, before it had struck the JV deal with Gold Fields in November that year.

The new Gruyere mine plan is based on what the JV has learnt while moving the project through the construction stages as it prepares to push the button for a planned safe and efficient start‐up.

The updated mine plan incorporates a new five-staged pit design, which the JV expects to provide lower risk delivery of ore supplies to Gruyere’s processing facilities, while maintaining a similar grade and strip ratio profile identified by the 2016 FS.

The Gruyere JV has invested a substantial amount of time and money into growth projects such as its ongoing exploration on the Gruyere JV tenement areas and pre‐feasibility studies being carried out on the Golden Highway deposits, all located within a 25-kilometre radius from the Gruyere processing facilities.

This has added 3.6 million tonnes at 1.55 grams per tonne gold for 178,500 ounces of Ore Reserves to the mine plan from the Attila and Alaric deposits on the Golden Highway.

The Gruyere JV anticipates its first gold production to come in the June quarter this year, from which it is planning a six to seven‐month ramp‐up to full production.

The forecast life of mine production now averages approximately 300,000 ounces per annum, a substantial increase from an average of 270,000 ounces per annum determined by the FS.

This new forecast is driven by the purchase of larger SAG and Ball Mills, enabling the JV to increase processing throughput to 8.2 million tonnes per annum in fresh rock from 2021, along with slight improvements to expected metallurgical recoveries and the addition of the two Golden Highway deposits.

“With first gold remaining on target for the June 2019 quarter, we have the confidence in Gruyere to be able to provide this update to the life of mine plan for this world‐class project,” Gold Fields executive vice president Australasia Stuart Mathews said.

“The updated mine plan indicates an increase in annual average gold production to 300,000 ounces per annum.

“This update also provides more clarity around Gruyere’s AISC and gold production forecasts.”

Things are definitely taking shape on site with the first ore being mined on schedule in January 2019, a generous amount of which is being stockpiled in order to de-risk the project start-up.

Construction of the Gruyere process plant and infrastructure is progressing at a cracking rate with overall construction at 91.2 per cent as at 18 January 2019.

“It has been an incredible journey for Gold Road, since discovering Gruyere in 2013,” Gold Road managing director and CEO Duncan Gibbs said.

“For Gold Road the updated mine plan means an attributable forecast share of approximately 150,000 ounces of gold on average per annum over the 12-year mine life.

“The cash flow Gruyere will produce from 2019 will be substantial and allow us to deliver tremendous value for shareholders, many of whom have backed us since before we made the discovery.

“Gold Road will continue to work closely with Gold Fields, to safely and successfully conclude construction and commissioning of this world‐class gold operation.”

Exploration remains a strong focus of Gold Road Resources and the company is keen to maintain its reputation as an explorer for, and discoverer of, rich gold deposits.

Gold Road’s Yamarna exploration tenements cover 180 kilometres of greenstone strike, making it one of Australia’s largest greenfields gold exploration projects.

The 100 per cent-owned Northern Project Area that encapsulates the Ibanez (Corkwood) and Bloodwood targets has also demonstrated plenty of potential.

Most recent news has emanated from the 100 per cent-owned Southern Project Area, in particular at the Gilmour Prospect, which is shaping up to be a very interesting discovery in its own right.

The Gilmour prospect has previously exhibited excellent continuity of mineralisation characterised by a consistent and predictable gold-¬bearing quartz vein in most intersections.

Gold Road has focused its efforts at Gilmour on understanding both the geological controls to mineralisation, and the potential economic value of the discovery, from which it has already rapidly advanced the project recording detailed drilling results capable of supporting potential future resource modelling activities.

Gold Road recently completed a round of infill and extensional drilling at the Gilmour deposit that demonstrated exceptional internal consistency and extension to the known high‐grade gold mineralisation.

The most recent intersections from Gilmour include:

18WDDD0031
0.62 metres at 117.78 grams per tonne gold from 340.55m;

18WDDD0026
1.78m at 29.68g/t gold from 290m, including 0.96m at 54.59g/t gold from 290.82m;

18WDRC0193
19m at 2.78g/t gold from 63m, including 6m at 7.08g/t gold from 76m;

18WDRC0210
8m at 6.18g/t gold from 143m, including 2m at 22.27g/t gold from 147m;

18WDRC0199
3m at 13.99g/t gold from 124m, including 1m at 40.01g/t gold from 124m; and

18WDRC0192
3m at 13.84g/t gold from 180m, including 1m at 38.23g/t gold from 180m.

Gold Road remains confident these contiguous high‐grade results provide considerable scope for strike and down‐dip extensions to the known mineralisation at Gilmour.

The drilling program, comprising 11 diamond holes for 3,521m and 22 Reverse Circulation (RC) holes for 3,941m, was designed to infill previously reported high‐grade results.

The RC drilling was completed to an average 50m by 50m spacing to a vertical depth of 150m with the diamond drilling spaced at an average 100m centres from 150m to 300m below surface.

Drilling undertaken on the Gilmour Main Shear defined gold mineralisation over a 500m strike length and a dip extent of 300m.

A further diamond drilling program designed specifically to test the Waters Fault at the north end of the Gilmour deposit, returned high‐grade intersections associated with visible gold in quartz veining observed within the fault zone.

Gold Road interpreted these results to demonstrate additional exploration potential exists in parallel mineralised structures.

“This last round of infill and extensional drilling proved very successful in confirming the high‐grade nature of the mineralisation at Gilmour, with abundant free gold consistently intersected in both diamond and RC drilling,” Gold Road Executive Director ‐ Exploration & Growth Justin Osborne said.

“More importantly, the drilling demonstrated a highly predictable geometry to the main shear zone as well as indications of possible parallel structures which only adds to the upside of this exciting new discovery.

“Our 2019 drilling programs will kick off in February with diamond and RC drilling targeting further extensions to the currently defined Gilmour footprint prior to commencing detailed drilling for resource assessment.”

 

Gold Road Resources (ASX: GOR)
…The Short Story

HEAD OFFICE
Level 2
26 Colin Street
West Perth WA 6005

Ph: +61 8 9200 1600

Email: perth@goldroad.com.au
Website: www.goldroad.com.au

DIRECTORS
Tim Netscher, Duncan Gibbs, Justin Osborne, Sharon Warburton, Brian Levet

 

Cassini Resources Progressing Wide-Ranging Portfolio

THE INSIDE STORY: Base and precious metals developer and explorer Cassini Resources (ASX: CZI) has a project portfolio boasting an advanced Joint Venture with a major partner and its own prospective exploration plays.

Cassini Resources’ main project is the West Musgrave Joint Venture with OZ Minerals (ASX: OZL) where the JV is working together to develop the West Musgrave nickel-copper project (WMP) in Western Australia.

The latest activities at the WMP have advanced the Nebo-Babel Pre-Feasibility Study (PFS) where OZ Minerals recently progressed through the Stage 1 Earn-in requirement by contributing $22 million to acquire a 51 per cent interest in the project.

The PFS is on-track for completion in the second quarter of 2019.

The PFS resource infill drill program was completed late last year comprising approximately 40,000m of RC drilling.

Cassini anticipates the results will improve resource confidence and allow a maiden Ore Reserve estimate being published to coincide with completion of the PFS.

A further 4,000m of RC drilling was completed as part of an additional 23,000m drilling brought forward from the planned Stage 2 Feasibility Study program.

Resource definition drilling is due to re-commence during the March Quarter 2019 and in the meantime a new resource model for Nebo-Babel is being progressed utilising the new infill assay and geological data.

The WMP is the largest undeveloped nickel-copper project in Australia in a new mining camp with three existing nickel and copper sulphide deposits and several other significant regional exploration targets already identified that currently has over one million tonnes of contained nickel and two million tonnes of contained copper in Resource.

The recent PFS work included continued metallurgical testing, focusing on a variability program as well as flowsheet improvement opportunities.

Other work involved process plant and infrastructure engineering and market testing of power solutions.

The objectives of the metallurgy program are to improve concentrate recovery and grades across a representative range of nickel and copper ore-types to be mined from the WMP, particularly focussing on lower grades close to the economic cut-off grade.

Elsewhere on the WMP, 15 kilometres south of Nebo-Babel the JV partners made further progress on the One Tree Hill prospect, an early stage exploration target that was identified as part of a regional exploration strategy.

Although activity at One Tree Hill is relatively new, the prospect has already demonstrated potential to host ore-grade mineralisation with the extent of anomalous copper and PGE mineralisation indicating the possibility of it emerging as a very large mineralised system.

Drilling has encountered extensive and, compared to the rest of the WMP, unusually strong platinum and palladium anomalism throughout the host sequence that the JV has interpreted to possibly represent the halo to a much larger ore-system.

Two recent diamond drill holes targeting moving loop electromagnetic (MLEM) anomalies and extensions to mineralisation encountered by previous drilling (CZD0017) returned:

CZD0083A
24.65 metres at 0.69 per cent copper and 0.44 grams per tonne PGE from 337m with a higher-grade core of 9m at 1.15 per cent copper and 0.64g/t PGE.

The intersection also included a massive sulphide zone of 2.6m at 0.96 per cent copper, 0.48 per cent nickel, 0.1 per cent cobalt and 1g/t PGE.

The results are generally consistent with earlier results that intersected a massive sulphide zone within a broader disseminated zone.

A second diamond drill hole, CZD0087A, sited approximately 100m south of CZD0017, missed the target intrusion because of an apparent fault offset, but did, however, intersect a 40m zone of PGE anomalism towards the bottom of hole, possibly representing the halo of magmatic mineralisation

A down hole electromagnetic survey (DHEM) identified a large off-hole conductor consistent with copper sulphide conductivity that may represent the extension of mineralisation observed in CZD0017, but on a much larger scale.

The JV has identified this new DHEM conductor as a priority target for drill testing when exploration operations resume in 2019.

“The West Musgrave Joint Venture has had several recent successes with new discoveries at Nebo, Babel and Yappsu,” Cassini Resources managing director Richard Bevan told The Resources Roadhouse.

“The Pre-Feasibility Study is well on track and we look at being able to provide further updates on this shortly.

“We are also awaiting drilling results from a program we completed at our 100 per cent-owned West Arunta zinc project, which we think could become a new zinc province in one of the last mineral frontiers in Australia.”

Cassini’s drilling at the West Arunta project followed on from an Airborne Electromagnetic (AEM) survey that delivered a new geological interpretation to assist targeting for the drill program.

The AEM survey mapped stratigraphic horizons within the sedimentary basin and the ‘Dione Horizon’, which the company considers to be a discrete stratigraphic unit that is sulphide or graphite-rich, and perhaps locally mineralised, that sits within the broader Bitter Springs Formation.

These types of horizons are generally favourable targets for base metal mineralisation.

With the addition of the AEM data, the conceptual targets Cassini has previously identified at Mimas and Janus are supported by several anomalous features drawn from independent datasets making them the highest priority targets for the drill program.

The Mimas prospect is a discrete AEM anomaly and the most conductive along the Dione Horizon implying an anomalous local process.

It has given up the strongest magnetic response in the basin coincident with the AEM anomaly and is situated in a favourable position in the axis of the Dione Horizon.

The Janus prospect sits at the peak of a residual gravity anomaly that appears to be structurally controlled, potentially representing a dense sulphide body.

A discrete, isolated AEM anomaly, coincident with a small geochemical anomaly, Janus is within a structurally favourable position of the type often associated with sedimentary mineralisation.

Although the drilling was conducted last year, a laboratory backlog has prevented Cassini from completing evaluation and interpretation of results and geological data, however, results will be released when complete.

On the corporate front Cassini has entered an option agreement to acquire 80 per cent of the Yarawindah Brook project, located 130km northeast of Perth, near the township of New Norcia.

The project has had only limited nickel, copper and cobalt exploration despite a favourable regional setting, prospective geology and near-surface occurrences of nickel and copper.

Historic exploration focussed on a PGE resource, which Cassini views as a ‘path-finder’ anomaly for massive nickel-copper-cobalt sulphides.

Drilling in 2007 targeting surface EM anomalies, returned encouraging results, yet no further follow-up drilling was conducted.

Cassini is seeking an access agreement with local landholders and environmental approvals in preparation for drill testing two electromagnetic anomalies.

Any explorer worth its salt seeks gold at some stage and Cassini is doing so at the 100 per cent-owned Mount Squires project, adjacent to the WMP.

Cassini has been developing the project over the past two years through consolidation of tenements with several prospective gold targets, which includes a range of conceptual to advanced prospects.

Having completed drilling at West Arunta, Cassini has now turned its attention to accelerating exploration at Mount Squires where gold prospects are already defined, and further work is hoped to enhance some of these targets prior to drill testing.

Targeting work is expected to continue through the March Quarter in preparation for drill testing during the upcoming field season.

 

Cassini Resources Limited (ASX: CZI)
…The Short Story

HEAD OFFICE
16 Ord St Street
West Perth WA 6005

Phone: +61 8 6164 8900

Email: admin@cassiniresources.com.au
Web: www.cassiniresources.com.au

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

 

Azure Minerals Making Mexican Mine Movements

THE INSIDE STORY: The movement companies make from the exploration phase into the mine developmental process makes hard work of creating market interest.

Case in point: Azure Minerals (ASX: AZS) and its 100 per cent-owned Oposura zinc-lead-silver project, located in Sonora Mexico.

After acquiring the project in 2017, Azure soon reported high-grades of zinc, lead and silver of greater than 10 per cent zinc, 10 per cent lead and 40 grams per tonne silver, recording maximum values of 49.6 per cent zinc, 34.1 per cent lead and 448g/t silver, attracting plenty of market attention.

Samples from the massive sulphide zones of the project returned copper grades in the range of 0.5 per cent to one per cent copper, adding further interest.

Azure defined a body of high-grade, massive sulphide-hosted, zinc, lead and silver mineralisation, to deliver an initial Mineral Resource Estimate (MRE) of 2.9 million tonnes at 5 per cent zinc, 2.8 per cent lead and 17g/t silver.

These figures were too good to ignore, and a subsequent Scoping Study has determined Oposura to be an economically and technically robust, high-margin project.

Based upon metals prices of the date of the MRE, the Oposura project is expected to generate total positive EBITDA of $237 million and an NPV of $112 million, with an Internal Rate of Return of 76 per cent and a 16 month payback period.

The study determined low operating and capital costs, high-value concentrates, strong operating cashflows and, most importantly, a C1 cash cost (per pound of payable zinc production, net of by-product credits) in the lowest quartile of world zinc producers, all support the positive project economics.

It also demonstrated an optimal mining rate of approximately 500,000 tonnes per annum from both open pit and underground mining operations, at Life of Mine (LOM) average grades of 4.6 per cent zinc, 2.6 per cent lead and 15.9g/t silver, delivering an initial mine life of 5.3 years.

Approximately 95 per cent of the zinc and lead mineralisation to be mined in the first year sits in the current JORC Indicated Mineral Resource category, ensuring most of the payback period of 16 months will be achieved by mining Indicated Resources.

The processing flowsheet comprises two-stage crushing followed by ore sorting utilising Dense Media Separation (DMS) to reject waste material and to feed an upgraded product to the milling and flotation circuit at approximately 295,000 tonnes per annum at LOM average grades of 7.5 per cent zinc, 4.1 per cent lead and 24.5g/t silver.

This will result in high recoveries and clean, commercial-grade concentrates averaging grades of 53 per cent zinc with an average zinc recovery of 87.5 per cent.

It will also produce average lead concentrate grades of 60 per cent lead and 320g/t silver with an average lead recovery of 85 per cent and average silver recovery of 67 per cent.

Oposura will produce approximately 35,000 tonnes of zinc concentrate and 16,000 tonnes of lead concentrate annually, containing approximately 19,000 tonnes of zinc and 10,000 tonnes of lead respectively.

Annual production of lead concentrate will contain approximately 145,000 ounces of silver.

The project is anticipated to be in production by late 2020 to early 2021.

The study was supported by continued Resource infill and extension drilling that returned further high-grade mineralisation over substantial widths.

Mineral Resource infill drilling in the East Zone returned:

OPDH-184
5.25 metres at 24.4 per cent zinc and lead (Zn+Pb) and 34g/t silver, including 3.05m at 39.3 per cent Zn+Pb and 54g/t silver;

OPDH-185
8.65m at 11.4 per cent Zn+Pb and 17g/t silver, including 4.55m at 19.6 per cent Zn+Pb and 29g/t silver; and

OPDH-194
6m at 11.7 per cent Zn+Pb and 13g/t silver, including 2.95m at 21.9 per cent Zn+Pb and 23g/t silver.

Central Zone Resource extension drilling returned wide zones of near-surface, high grade mineralisation, including:

OPDH-159
6.15m at 15.7 per cent Zn+Pb and 97g/t silver, including 4.8m at 19.3 per cent Zn+Pb and 122g/t silver;

OPDH-171
4.4m at 20.4 per cent Zn+Pb and 294g/t silver, including 3.6m at 24.2 per cent Zn+Pb and 353g/t silver;

OPDH-177
4.55m at 36.9 per cent Zn+Pb and 138g/t silver, including 3.4m at 48.2% per cent Zn+Pb and 177g/t silver; and

OPDH-187
3.6m at 15.5 per cent Zn+Pb and 26g/t silver, including 2.45m at 20.5 per cent Zn+Pb and 34g/t silver.

“These high-grade, massive sulphide drill hits from the sparsely drilled Central Zone confirm the area’s potential to significantly increase Oposura’s resource base,” Azure Minerals managing director Tony Rovira told The Resources Roadhouse.

“They continue to build on the very positive results from the Oposura Scoping Study and confirm potential to extend the mine life and further improve the already impressive project economics.

“Additionally, the continued success of the resource infill drilling program confirms our strong confidence in the width, grade and internal continuity of the East Zone mineralisation.

“The results represent the opportunity for us to upgrade most of the East Zone Mineral Resource to Indicated status and, thereby, further de-risk the proposed Oposura mining operations.

“Of note is the confirmation of very high-grade, zinc-rich mineralisation in the western part of the East Zone which extends into the Central Zone.

“We are continuing to evaluate the potential of this area.”

Elsewhere on the Mexico peninsula, approximately 50km south of the USA border, Azure has the Alacrán project, covering 54 square kilometres of prospective exploration ground in the middle of the Laramide Copper Province, North America’s most prolific copper-producing district extending from northern Mexico into the southern United States.

Azure Minerals earned 100 per cent interest in the Alacrán project in 2016 from Minera Teck S.A. de C.V., a 100 per cent-owned subsidiary of Canada’s largest diversified resource company, Teck Resources Limited.

Testament to the potential of the project sees Teck currently earning back into Alacrán and taking on the role of project operator.

Teck completing the first two years of a total four-year program at Alacrán during 2017 and 2018.

This comprised the first Option, which entitles Teck to earn back a 51 per cent share of the project by sole-funding US$10 million of exploration expenditure and making cash payments to Azure totalling US$500,000.

Once it achieves 51 per cent, Teck may exercise the second Option to further increase its interest to 65 per cent by sole funding an additional US$5 million over a further two years and making additional cash payments to Azure of US$1.5 million.

In this case, Azure will retain a contributing 35 per cent interest in the Alacrán project while the project’s previous owners – pre-Teck – Grupo Mexico will retain a 2 per cent NSR royalty.

Teck’s most recent program comprised geological, geochemical and geophysical surveys, followed by a Phase 2 diamond drilling campaign.

Sixteen holes targeted the Cerro Alacrán prospect chasing porphyry-style copper mineralisation beneath a blanket of copper oxides and chalcocite (an acid-soluble copper sulphide mineral) which was previously drilled by the Mexican Geological Survey in the 1970s and by Grupo Mexico in the 1990s.

The remainder of the holes targeted epithermal-style precious metals mineralisation at Cerro San Simon and Cerro Colorado.

Logging and sampling of the drill core is nearing completion and Azure anticipates final assay results from Teck when its QA/QC process of the geochemical data has been completed.

 

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

HEAD OFFICE
Level 1, 34 Colin Street
West Perth, WA 6005

Phone: +61 8 9481 2555

Email: admin@azureminerals.com.au
Web: www.azureminerals.com.au

DIRECTORS
Peter Ingram, Anthony Rovira, Wolf Martinick

 

Alliance Resources Takes Full Ownership at Wilcherry

THE INSIDE STORY: Alliance Resources (ASX: AGS) has become 100 per cent owner of the Wilcherry project, located within the southern part of the Gawler Craton in the northern Eyre Peninsula of South Australia.

Alliance Resources has been the senior partner in the Wilcherry JV for some time and has now purchased the remaining 18.59 per cent of the project for $1.5 million from the subsidiary company of partner Tyranna Resources (ASX: TYX).

Finalising ownership means Alliance now owns 100 per cent of the high-grade Weednanna gold deposit where a mining and processing scoping study is in progress.

The deal also delivers an 80-person camp on leasehold land located just 45 kilometres from the proposed mine site, in the township of Kimba.

Importantly, it also eliminates the administrative burden and costs associated with operating a joint venture and will streamline the future statutory approvals required at the time Alliance submits a Mining Lease Proposal in respect of the Weednanna gold deposit.

“Buying the remaining interest now, rather than later, is a logical move for Alliance,” Alliance Resources managing director Steve Johnston told The Resources Roadhouse:

“The majority party must buy-out the minority party’s interest in the project when the latter’s interest falls to 10 per cent or less as outlined in our ASX announcement dated 23 September 2016.

“By the time Alliance earns 90 per cent in the project, 18 to 24 months from now, the enterprise value of the project may be much higher than it is now, especially as we move towards production.”

In September 2018, Alliance announced a maiden Mineral Resource estimate for the Weednanna deposit of 1.097 million tonnes at 5.1 grams per tonne gold for 181,000 ounces of gold.

Approximately 45 per cent of the Mineral Resource has been classified as Indicated and 55 per cent classified as Inferred.

The Indicated classification corresponds with areas of higher drilling density and the Inferred classification with areas of lower drilling density.

From this, the company has concluded that the Inferred Mineral Resource reflects both modelled gold shoots with limited drilling and a decrease in the density of drilling with depth.

In addition, zones within the top 100 metres of the Mineral Resource area lack drilling, which Alliance believes to have potential for the discovery of new gold shoots based on historical drilling.

The company explained that the reported Mineral Resource comprises that proportion of gold contained within $2,000 pit shells of greater than 0.5g/t gold and greater than 2g/t gold underground potential.

This signals potential to increase the size of the Mineral Resource with further drilling as all 13 modelled gold shoots are open at in at least one direction.

Eighty-three per cent of the Mineral Resource occurs within 120 metres of surface (1,253 ounces per vertical metre) and is readily accessible using open pit or underground mining techniques.

News of the Joint Venture buyout came on the heels of some encouraging exploration activity at and around the Weednanna project as part of Alliance’s strategy to identify the potential for additional gold mineralisation within five kilometres of Weednanna.

The first was an announcement of gold results Alliance had derived from the re-analysis of historic iron ore drill samples at the Weednanna North prospect.

The Weednanna North prospect was originally explored by Ironclad Mining between 2008 and 2012 for economic concentrations of iron ore, drilling 12 diamond holes, for 761.4 metres and 127 RC holes, for 12,786 metres.

During 2018, Alliance Resources had all historic RC and diamond holes from the Weednanna North prospect systematically relogged for cross-sectional interpretation and 3D geological modelling, resulting in the identification of gold mineralisation at the prospect.

Eleven holes returned above two grams per tonne-metre (grade by thickness), including a best result of:

10WNRC027
22 metres at 0.34g/t gold from 42m in, including 2m at 1.12g/t gold from 42m.

“The broad gold-anomalous intersections we have identified at Weednanna North are similar to what we have previously observed adjacent to the high-grade gold shoots at the Weednanna gold deposit,” Johnston said.

Geologically speaking, the Weednanna North prospect consists of a northwest striking zone of calc-silicate and magnetite skarn altered Paleo-Proterozoic Hutchinson Group metasediments that are bounded by Archaean Sleaford Complex granite and gneiss.

The geology is very similar to the Weednanna Gold Deposit and there appears to be similar structural positions to those that host gold at Weednanna.

Due to the iron ore-based exploration activities of the previous owner, the Weednanna North Prospect has not previously been drilled to target favourable structural positions that may host high-grade gold.

Alliance has interpreted the gold assay results from its re-analysis to confirm the gold prospectivity of the area and indicate that the Weednanna North prospect is a priority gold exploration target that warrants further drill testing.

Next up was results from aircore drilling Alliance had conducted for gold at the Weednanna East prospect.

A program consisting eighty-five aircore drillholes was completed for 3,101 metres as a first pass test to extend known gold in regolith anomalism at Weednanna East.

This drilling program involved drilling of four lines of 50m by 200m spaced holes designed to test around the existing gold in soil and regolith anomalism and extend coverage to the west of existing RAB drilling at Weednanna East to cover a series of northwest striking faults.

The company received one metre scoop assay results with four of the holes returning greater than 100ppb gold with a best result of:

18WDAC078
2m at 1.31g/t gold from 49m.

The drilling demonstrated a zone of discontinuous gold anomalism of greater than 100ppb gold extends over 1,000m and remains open in the north.

From what Alliance has seen to date, it has determined the majority of the gold anomalism to have a northeast trend that is located towards the end of hole, near a saprolite/saprock boundary.

Given the iron-poor felsic nature of these host rocks, this is where the company expects the gold in regolith anomalism to concentrate.

Alliance considers the magnitude and distribution of gold in the regolith may be indicative of primary gold mineralisation and further drilling is warranted to better define the gold in regolith anomalies before bedrock drill testing.

“Weednanna East is the first regional gold exploration target to be tested proximal to the Weednanna gold deposit,” Johnston explained.

“We are very encouraged by these aircore drilling results which indicate to us the prospectivity of the district.”

 

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

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

Ph: +61 3 9697 9090

Email: info@allianceresources.com.au
Web: www.allianceresources.com.au

DIRECTORS
Ian Gandel, Tony Lethlean, Steve Johnston

 

Gold Search Stretches from WA to Alaska

THE INSIDE STORY: Perth-based exploration play Riversgold (ASX: RGL) is building on new gold discoveries in the Eastern Goldfields as it prepares for a second campaign in Alaska’s Tintina Belt.

Riversgold is active in the Eastern Goldfields of Western Australia, a region that still provides plenty of blue sky for those prepared to put in the hard yards, as is the American state of Alaska where the company is exploring in the Tintina Gold Province.

In the past six months, much of Riversgold’s activities have focused on its portfolio of gold tenements in the Eastern Goldfields, southeast of Kalgoorlie.

Riversgold has completed several rounds of RC drilling in the area, the majority of which have focussed on the Farr-Jones property, where the company has intersected high-grade gold mineralisation in multiple positions.

Farr-Jones is approximately 15 kilometres northeast of Silver Lake Resources’ (ASX: SLR) Randalls processing plant.

It is one of several targets Riversgold identified from historical surface geochemical surveys and limited drilling completed during the late 1980s and early 1990s.

Prior to Riversgold, only a single line of drilling completed in 1991-92 had drill tested Farr Jones below 100m with the deepest hole from that program intersecting 2m at 4.71g/t gold from 143m down hole.

In three RC drilling programs completed at Farr Jones in 2018, Riversgold confirmed three zones of easterly dipping gold mineralisation over a strike of 600m.

Drilling delivered high-grade drill hits of:

FJRC0002
4 metres at 6.3 grams per tonne gold from 119m; and

FJRC0001
3m at 17.8g/t gold from 182m.

Regional soil sampling completed by Riversgold during 2018 highlighted the prospectivity of the Farr Jones area, with soil anomalies previously untested by drilling identifying anomalous areas further north.

A number of these targets were tested by aircore drilling in late 2018.

Two new gold discoveries were made at the Eales and Little targets, like Farr Jones named after the World Cup winning Wallabies side of the 1990s.

These results mean the Allan Kelly-led company has identified multiple zones of gold mineralisation along a north-south trending strike spanning 2.5km, demonstrating the potential for the project to host multiple gold deposits over a decent strike length.

“The aircore drilling results confirmed the potential for multiple gold deposits to be delineated within the wider Farr-Jones project,” Riversgold managing director Allan Kelly told The Resources Roadhouse.

“We were previously looking at the potential for a single gold deposit at Farr-Jones, but we believe we have now discovered oxide and/or primary gold mineralisation over 2.5 kilometres of strike beneath soil anomalies at Farr-Jones, Eales and Little, with a number of other soil anomalies still to test.

“We think we have just scratched the surface at this exciting new gold project and are looking forward to systematically testing it with further soil sampling and drilling.”

 

The aircore drilling Riversgold conducted at Eales and Little is relatively wide spaced, and the company expects to be back in the region to complete a program of systematic grid aircore drilling with deeper follow-up RC drilling where required.

The drill rigs are also planned to return to Farr Jones, as well as testing other gold anomalies identified in the region such as Horan, around 500m west of the Eales discovery.

But prior to this, Riversgold has turned its attention to the Queen Lapage gold prospect following the granting of permits which have facilitated Riversgold’s first drilling of this large target located under one of the salt lakes scattered throughout the region.

Queen Lapage encompasses approximately 17km of the Randall Fault, a major mineralised structure that hosts several substantial gold occurrences.

Approximately 11km of the Randall Fault is located under the thin lake sediments of Lake Yindarlgooda where local geology is characterised by a North-North-West trending package of mafic/ultramafic rocks and clastic sediments separated by a faulted contact.

This is akin to what the company has encountered at the Farr-Jones prospect, and like Farr-Jones, the contact at Queen Lapage has been cross-cut by numerous North-East-trending faults.

Historical shallow drilling intersected anomalous gold at several locations within an interpreted shear zone to the west of the Randall Fault, however the drilling was sporadic and mostly limited to the islands within the lake.

No drilling has been conducted at Queen Lapage since the early 2000s and Riversgold’s initial program of 200 wide-spaced aircore holes will be completed in early February as the first important step in the systematic testing of the major target.

“We always considered Queen Lapage to be one of the most prospective targets we had,” Kelly said.

“It was a highlight of our company prospectus when we listed in 2017 and was one of the main reasons for Evolution’s investment in the company.

“We believe it has all the hallmarks of a highly prospective gold target and the scale to potentially host multiple gold deposits along the Randall Shear Zone.”

Further afield in the United States of America, Riversgold has a 100 per cent-interest in three projects in southwest Alaska through a wholly-owned Alaskan subsidiary.

The projects are located at the western end of the Tintina Gold Province, which hosts the giant 45 million-ounce Donlin Creek gold deposit, which is owned equally by wholly-owned subsidiaries of NOVAGOLD and Barrick Gold Corporation.

The province hosts other intrusion-related gold deposits, such as Fort Knox, Pogo and Livengood.

Riversgold completed its first Alaskan field season last year completing geochemical and geophysical surveys over several targets along with a single diamond drill holes at each of the Luna, Luna East and Quicksilver targets.

From the work carried out to date, the company has identified multiple outcropping high-grade gold occurrences along the 40-kilometre-long North Fork Fault corridor.

“We copped more than our share of bad luck in Alaska last year when mechanical problems severely limited the amount of diamond drilling we had hoped to complete,” Kelly said.

“The work we did complete however only added to our belief in the prospectivity of the region to host world-class deposits and we’ve added to our ground position ahead of what we’re hoping will be a more active 2019 field season in Alaska starting in the middle of the year.”

Back in Australia, the company is also exploring for a large Iron-Oxide Copper-Gold deposit at two highly prospective 100 per cent-owned IOCG projects at Churchill Dam and Burt Lagoon in another well-known region, the Olympic Copper-Gold Province of South Australia.

The Churchill Dam prospect is located approximately 90km South-West of the giant Olympic Dam copper-gold-silver-uranium-rare earth element (REE) deposit and 60km west of the Carrapateena and Khamsin deposits.

Churchill Dam is characterised by a large gravity anomaly that has been previously shown to host brecciated and hematite-altered Gawler Range Volcanics with anomalous copper, gold, uranium and REEs along with potassic and sodic alteration.

The Burt Lagoon prospect is located at the intersection of the Torrens Hinge Zone and a North-West trending regional gravity lineament that passes through the Punt Hill and Mt Gunson copper deposits, as well as the company’s existing Churchill Dam IOCG project.

These prospects received a recent boost with Riversgold receiving all approvals required for drill testing of the targets following an announcement by its big-end-of-town neighbour, BHP releasing drill results from its nearby Oak Dam West target.

 

Riversgold Ltd (ASX: RGL)
…The Short Story

HEAD OFFICE
Suite 6
125 Melville Pde
Como WA 6152

Ph: +61 8 6500 7375

Email: info@riversgold.com.au
Website: www.riversgold.com.au

DIRECTORS
Roderick Webster, Allan Kelly, Jeffrey Foster, Aaron Colleran

 

Musgrave Minerals: New year…New Gold

THE INSIDE STORY: Musgrave Minerals started 2019 as it finished 2018, by announcing further positive drilling results from the company’s Cue project in the Murchison district of Western Australia.

Late in 2018, Musgrave Minerals completed a maiden reverse circulation (RC) drilling program at the Lake Austin North target.

Lake Austin North is located approximately three kilometres north of the Break of Day/Lena targets, which have been the subject of earlier Musgrave exploration activities.

Lake Austin North sits within a 28km-long prospective corridor that hosts the Break of Day and Lena gold resources of 868,000 tonnes at 7.15 grams per tonne gold for 199,000 ounces of gold and 2.68 million tonnes at 1.77g/t gold for 153,000 ounces of gold respectively.

The maiden Lake Austin Drilling consisted 18 holes focused on the A-Zone and C-Zone that led to the discovery of thick, high-grade basement gold mineralisation at A-Zone with results including an intercept of:

18MORC057
94 metres at 2.2g/t gold from 156m to end of hole (EOH), including;

52m at 3.8g/t gold from 198m to EOH, including;

29m at 5.1g/t gold from 198m.

A program of follow-up diamond drilling focused on establishing the true thickness, tenor and extent of the gold mineralisation in unweathered basement rock to help define the potential of the A-Zone system concluded just before Christmas.

It didn’t take long for the news to flow from the drill bit with diamond drill hole 18MODD008 returning an exceptionally thick intercept with a high-grade core on the southern-most basement drill traverse at A-Zone of:

242m at 1g/t gold from 61m down hole, including;

45m at 3.3g/t gold from 70m, including;

9m at 4.6g/t gold from 70m and 18.9m at 4.7g/t gold from 96.3m.

Other intersections from 18MODD008, included:

5.8m at 4.5g/t gold from 199.8m.

“The diamond drilling is confirming the grade and thicknesses seen in the RC drilling as well as extending the mineralisation where it remains open along strike,” Musgrave Minerals managing director Rob Waugh told The Resources Roadhouse.

“Our southern-most drill hole 18MODD012 returned thick mineralisation with a high-grade core at A-Zone and demonstrated that the basement mineralisation remains open and untested to the south and at depth.”

18MODD012
128.1m at 0.5g/t gold from 133.3m down hole, including 32m at 1.5g/t gold from 133.3m, including 9.7m at 3.1g/t gold from 133.3m.

“That encouraged us to ramp up our diamond drilling so we could step out and test the limits of the mineralisation along strike with the aim to further outline the size and grade of this potentially large and exciting gold discovery,” Waugh continued.

As part of the program, drill hole 18MODD005 was conducted on the discovery cross section as a scissor hole.

This hole also confirmed the previously released RC results and steep east dip of the mineralisation, intersecting:

80m at 1.3g/t gold from 102.2m downhole, including;

20m at 4.5g/t gold from102.2m, including higher-grade zones of:

2.6m at 11g/t gold from 102.8m; and

7.4m at 6.5g/t gold from 114.9m.

From the drilling carried out to date, Musgrave has determined the A-Zone consists of a broad regolith gold halo extending up to 300m wide and covering a strike extent of over 800m.

The fresh rock gold mineralisation beneath the regolith halo is steeply east dipping and open to the north, south and down dip below approximately 50m of transported cover.

The A-Zone mineralisation is proximal to a tonalite-mafic contact within a foliated silica-sericite-carbonate-albite-pyrite alteration zone with multi-phase quartz veining.

Having scored such encouraging results, it was no surprise the company was able to raise $5.5 million to accelerate drilling of the new Lake Austin North gold discovery, even at a time when the market was suffering pre-Christmas doldrums.

“The funding enabled us to secure three drill rigs in the new year to accelerate drilling at the new Lake Austin North discovery as well as our other Cue project targets,” Waugh said.

While most folk were still on holidays, Musgrave Minerals was delivering new reports to the ASX as its next round of diamond drilling extended the basement gold mineralisation at A-Zone to more than 350m in strike where it currently remains open in all directions.

Musgrave Minerals’ drilling campaign shows no signs of slowing down with a phase 2 program of diamond drilling at A-Zone, Lake Austin North already underway.

This program will consist of a minimum of 15 drill holes for approximately 4,000m and drilling will continue until April.

The company anticipates receiving its next lot of assay results in late February.

In concert with the diamond drilling, the company is conducting a regional lake aircore drilling program to define the extents of the A-Zone and C-Zone mineralisation to enable accurate diamond drill targeting along strike.

The lake aircore program is also carrying out preliminary first pass testing of new lake gold targets.

While all this is developing, Musgrave Minerals is continuing negotiations with Westgold Resources (ASX: WGX) regarding a mining and processing profit sharing agreement over the existing gold resources at Cue that does not include Lake Austin North.

Musgrave Minerals signed a non-binding Term Sheet with Westgold Resources last year that provides a near term development pathway for the existing gold resources at the Cue project.

The Term Sheet outlines a Mine Management and Profit Sharing arrangement, under which Musgrave would receive 50 per cent of profits from operations that would be financed, managed and operated by Westgold.

The arrangement would be restricted to the existing JORC code-compliant gold resources at the Lena, Break of Day, Jasper Queen, Gilt Edge and Rapier South deposits on Musgrave’s 100 per cent-owned tenements at Cue.

Musgrave would retain 100 per cent of the exploration interests and upside outside of the defined resources.

“This deal with Westgold reduces the technical and capital risk for Musgrave and provides the potential for a near term development option,” Waugh explained.

“Musgrave would retain a 100 per cent interest in all the exploration upside and the potential development is expected to generate positive cashflow that can be utilised to fund exploration, resource growth and discovery for the benefit of Musgrave shareholders.”

“The relationship would also enable Musgrave to focus on its exploration strengths and accelerate our drilling programs across a range of high-grade targets, including our exciting gold discovery at Lake Austin North.”

Musgrave Minerals has plenty of confidence in the potential to extend existing mineralisation and discover new mineralisation within the Cue project area, which it believes it has demonstrated by its combined successes at Break of Day, Lena and now, Lake Austin North.

In a nutshell, Musgrave is exploring for systems of a size that have the potential to deliver a substantial Resource increase and may in the future define a stand-alone operation.

 

Musgrave Minerals Ltd (ASX: MGV)
…The Short Story

HEAD OFFICE
Ground Floor
5 Ord Street
West Perth WA 6005

Ph: +61 8 9324 1061

Email: info@musgraveminerals.com.au
Website: www.mugraveminerals.com.au

DIRECTORS
Graham Ascough, Rob Waugh, Kelly Ross, John Percival