This year the award celebrated the achievements of Sandfire, which the conference identified to be somewhat rare in today’s business environment.

These included the discovery of a major new resource, finalisation of a feasibility study, relevant approvals, financing and construction are somewhat problematic for most resource companies operating in Australia and abroad.

Sandfire became top Digger this year having taken its Degrussa discovery through to production in less than three years and from what we understand largely on time and on budget.

During this time the company has maintained shareholder value and it has engaged strategic shareholders who assist with bolstering the corporate balance sheet and provide strong product off take assistance.

The award judges identified these accomplishments to represents a significant achievement and the result of a focused approach and disciplined management.

The Digger of the Year Award was accepted by Sandfire managing director Karl Simich on behalf of the company.

Emerging Company Award: ABM Resources

A number of years ago, Diggers and Dealers introduced the Duelling Drill Rigs sessions to allow emerging companies a dedicated position in the conference program to present their strategies and project credentials in an environment that allowed them to be assessed against their peer group.

The Emerging Company Award is based on the presentations made at Diggers and Dealers during the Duelling Drill Rigs sessions.

ABM Resources managing director Darren Holden accepted the award on behalf of the company.

Media Award – Matt Chambers of The Australian newspaper

A number of years ago Diggers and Dealers introduced an award to recognise excellence in journalism focused on the resources sector.

Initially the award was voted on by industry peers. This year voting was expanded to include the resources industry.

This year’s winner Matt Chambers was singled out for his active interest in the industry and his dedication to ensure issues associated with resources are independently and thoughtfully portrayed.

Matt is highly respected by both his peers and the general industry.

DIGGERS AND DEALERS: In During a short cab ride The Roadhouse discovered not all the deals at Diggers & Dealers are done under the big marquee.

Half way to my destination my driver opened the centre console, pulled out a small black box and said, “Have a look at that.”

He had handed me, with no great fanfare or fuss, a small gold nugget with a price tag on it of $3700.

My man’s name is Roy Turner and besides driving taxis he also runs a gold shop in Kalgoorlie’s sister city of Boulder.

“We do a bit of processing work for small miners,” he explained.

“If they want their quartz specimen smashed up and the gold got out of, we do that.

“We also make a bit of jewellery for different ones.”

 

Some of Roy’s handy work

I asked him to clarify that when he said ‘small miners’ he didn’t mean small mining companies and that he meant local prospectors.

As he confirmed this I asked if prospecting was a bit of cottage industry around Kalgoorlie?

“It’s quite a large industry actually,” he said.

“You don’t realise how many people there are out there actually doing it.

“They come from everywhere. From over east, America, even France. I’ve run into all nationalities at different times.”

It would seem that people still flock to the gold mining region surrounding Kalgoorlie with the idea of prospecting firmly set in their mind.

“Not only Kalgoorlie the entire Goldfields area,” Roy continued.

“There is gold all through the west. It is sort of one of the last frontiers, really.

“I carry a bit of gold with me as I drive around to show different people.

“I usually tend to get a couple of good sales.”

It would make sense that if somebody wanted to take home a souvenir of their time in Kal, it may as well be a genuine locally-sourced nugget.

Roy said there are usually a couple of Diggers delegates keen on taking a few nuggets home with them.

“Last year I was driving a bloke to the airport,” he recalled.

“We were about a minute away from the airport and I showed him this piece of gold and he said, ‘I want it.’

“I asked him how he was going to pay for it and he said he only had $200 on him.

“I said, ‘Give me that, you can put the rest of the money in my account and we’ll post it off to you’.

“We did the deal within about two minutes.”

I didn’t become one of Roy’s customers, but I’m sure by the end of the week his cab will be travelling a lot lighter.
 

DIGGERS AND DEALERS 2012: Before Diggers & Dealers officially kicked off, The Roadhouse visited the Kalgoorlie-based operations of gold producer Silver Lake Resources.

We were treated a quick tour around the company’s Lakewood processing facility.

What we weren’t treated to, however, was any insight or inclination into what the company was set to announce at the opening morning of the conference.

 

Gold dore bare poured at the Lakewood facility.

While we stood in a small, ammonia riddled, room watch the company’s latest gold pour its managing director Les Davis was hunkered down in  small Kalgoorlie house with his counterpart from Integra Mining Chris Cairns.

The two men emerged with a deal that will result in Silver Lake swallowing up the assets of Integra to create a gold company of substantial size with multiple Australian operating mines and mills.

The reaction to the combination around the Diggers marquee was one of assignation rather than surprise with most delegates saying they thought it to be a reasonable deal and one that has probably been on the cards for some time.

“Putting Silver Lake and Integra together, apart from the clear transparent synergies, we are creating a 400,000 ounce gold producing entity in 2014,” Silver Lake managing director Les Davis told a gathered throng of journalists.

“More importantly, combined we have 6.6 million ounces of gold in the Resource base, inclusive of 1.8 million ounces of Reserves.

“Our milling capacity, within a 60 kilometre radius of here (kalgoorlie), now totals 2.2 million tonne per annum.

“This will bring a lot of operational flexibility, shared infrastructure – roads, power, people, transport.

“This is an iconic deal and one of those rare opportunities where two managing directors can sit side by side and say that this deal is a one where one plus one equals three.

“And all of that will flow to shareholder returns for years to come.”

 

Les Davis and Chris Cairns front the media pack at Diggers.

Integra managing director Chris Cairns said the thinking behind the deal was the opportunity it offered to genuinely create value by bringing together two sets of skills.

The first possessed by Silver Lake, which has proven itself as a successful underground miner in the Mt Monger area that has recently introduced open pit production.

Integra brings to the deal a strong exploration emphasis with the discovery of three deposits in its trophy cabinet over the last five years.

“We have created value for our shareholders by developing those discoveries,” Cairns said.

“We are neighbours next door, we have complimentary skill sets, there is obvious, synergistic value to be created between the two companies.

“Unlike other mergers in the resources space, we’re not adding two assets that are in disparate geographic locations. We are adding two assets that are right side by side.

“The value that creates for both sets of shareholders is very, very compelling.

“The company, now, will be a very, very profitable gold producer. It will be one of the biggest gold producers in Australia. The revenue base and the financial base we are working from and the flexibility and optionality that the combination provides is second to none.

“So the Board of Integra, very enthusiastically, support the deal. We think it makes sense and we think it creates value for shareholders.”

The transaction will be implemented via an Integra Scheme of Arrangement and has been unanimously recommended by the Boards of both companies.

Under the Scheme, Integra shareholders will be offered one new Silver Lake share for every 6.28 Integra shares they hold.

The Silver Lake offer values Integra at $426 million1 (45.2 cents per share) and represents a premium of 43.6 per cent to Integra’s last closing price of 31.5 cents on the ASX last Friday.

It also offers a 40.3 per cent premium to Integra’s 20‐day volume weighted average price (VWAP) of 30.7 cents.

We welcomed a new face to The Roadhouse in Anitpa Minerals managing director Roger Mason who had a lot of interesting things to say about the company’s Citadel project.

In the grand scheme of things Antipa Minerals is relatively new to the ASX. When did you list?

We listed in April of 2011 after raising $10 million for the Initial Public Offering, which we are using to explore our Citadel project, located in the Paterson Province of Western Australia.

The granted tenements that make up the Citadel project cover an impressive 1700 square kilometres making us the largest holder of granted tenure in the Paterson Province.

We did a deal with Paladin just after we listed to acquire some additional high quality ground under application called the North Telfer project, giving us another 1300sqkm on the southern side of Citadel, bringing us to within 25km of the world-class Telfer and O’Callaghans deposits.

In total we have a 115km long continuous package of tenements covering a huge 3000 square kilometres of shallowly covered, grossly under explored world-class Paterson Province.

 

How did you come to acquire the Citadel project?

We acquired the project from Centaurus Metals, who had switched focus to Brazilian iron ore and were divesting their Australian assets, when we listed on the ASX last year.

Was that a case of being in the right place at the right time or had you had your eye on it?

We had spent around 12 months, as a group, undertaking due diligence, and looking for an appropriate project. Citadel ticked all the right boxes for us.

We wanted a project that was located in a ‘world-class’ under-explored province, which the Paterson Province certainly is with historic exploration being deterred or ineffective due to 85 per cent of the Paterson being under-cover.

The Citadel project also had proven endowment with the Magnum gold-copper-silver deposit being discovered there in the mid-1990s.

After appraising around two dozen projects, Citadel clearly stood up as the one to select and go forward with.

The Citadel project was a good one for Antipa Minerals to acquire given the company’s Board has a great deal of experience working up similar projects?

The Board was constructed on the thinking we had the right blend of technical and commercial capabilities to build a successful resources company.

Myself and non-executive directors Peter Buck, Mark Rodda and Gary Johnson all worked together with LionOre International. Peter and I are both geologists with over 60 years combined experience and we worked on similar projects in covered terrains with Western Mining and LionOre.

Our Chairman Stephen Power was an external counsel, who worked extensively with LionOre.

So LionOre was the connection and our main premise was if we could put a good enough team together and find a project with a potential high-leverage discovery scenario that would be an excellent combination.

So you ventured off into the under-explored, under-cover Paterson province with a prospective target having already been identified?

That’s right. The area hadn’t been explored for about ten years and previous exploration had been limited to that conducted by BHP in the early 1990s with nothing prior to that.

Some juniors working it during the late 1990s discovered Magnum on the back of BHP’s regional exploration efforts.

That provided an excellent foundation for us to work with in terms of regional geochemical and geophysical data sets, which came with the project.

The project basically sat idle through the 2000s and, as a consequence, never received any state-of-the-art geophysical surveys until we commenced exploration last year.

Besides the Magnum deposit there is also the Corker deposit. Had that been identified the same time as Magnum?

No – Corker is a greenfields Antipa discovery we found while conducting our ongoing regional exploration program using state-of-the-art airborne electromagnetic VTEM surveys.

We flew VTEM over 25 per cent of Citadel last year. This survey also identified an EM anomaly over Magnum from the air, which hadn’t been achieved by older generations of airborne EM technology.

It also picked up another very high quality EM conductivity anomaly, which we called Corker.

You must have been impressed to give it a name like that?

Our consulting geophysicist involved with the VTEM survey rang and said, ‘we have a corker of an EM anomaly!’ so we ran with it.

We like to consider it as the cork that has shot out of the champagne Magnum landing just four kilometres away.

What have you learnt about Magnum from the work you have conducted so far?

Our pre-IPO due diligence at Magnum determined the historical drilling had been drilled the right way for the stratigraphy, but the wrong way for the mineralisation.

We saw an opportunity to change the ‘personality’ of the deposit by turning the drill rigs around, which is what we did last year.

We drilled a number of holes in the opposite direction and instead of seeing two thin, steep east dipping gold-copper shoots we intersected a west dipping corridor greater than 350 metres wide hosting significant gold-copper-silver mineralisation, which we now know extends for more than 1.8 kilometres north-south and 600 metres in depth, and is open in all directions.

We also identified a number of higher-grade gold-copper bearing structures within this corridor.

That culminated in our March announcement of our maiden Inferred Mineral Resource at the Magnum deposit of 27.8 million tonnes at 0.5 grams per tonne gold, 0.3 per cent copper and 0.7 grams per tonne silver, which covers only approximately 25 per cent of the deposit’s strike length.

That gave us total contained metal of 415,000 ounces gold, 77,000 tonnes of copper and 641,000 ounces of silver at a 0.3 grams per tonne gold equivalent lower cut-off grade.

Are you confident of being able to grow that Resource?

We have conducted some bold, but limited, step out drilling. We drilled 200m to 400m and 600m step-out holes, which we are awaiting the assays for, and we had success in finding copper sulphide bearing mineralisation by this approach.

We’re not sure yet of the total volume of mineralisation as we only completed several ‘sighter’ step-out drillholes, but the mineralised system, at the moment, continues for at least 1.8km north-south along strike and remains open in all directions.

Drilling at Magnum is very broad spaced, nominally 100m centres or greater within the 500m long Resource envelope, and so Magnum requires further exploration to grow the Resource and, in particular,  to further evaluate its economic potential. Magnum is already a very large gold-copper-silver system with plenty of upside, both low-grade and higher-grade.

The early drilling results from Corker have been encouraging?

We started drilling the Corker EM anomaly in late April and the first drillhole hit bonanza grades returning an intersection of 0.13m grading 772 grams per tonne silver, 14.8 per cent lead, 1.86 per cent zinc, 0.10 per cent copper and 0.85 grams per tonne gold.

 

Corker was the first prospect Antipa has drilled besides Magnum, which speaks volumes for the prospectivity of the Paterson project.

We have completed just four drillholes at Corker and there is more information to come, but the volume of sulphide that we have intersected to date hasn’t been anywhere near adequate to explain the level of EM anomalism that was generated from the helicopter VTEM, or from the ground EM or subsequent downhole EM surveys.

The downhole EM generated a cracking off-hole EM anomaly which remains untested.

So we’ve got, as yet unexplained, EM conductors in the presence of very strong precious and base metal mineralisation and our goal now is to follow these leads up and find larger volumes of ‘quality’ sulphide mineralisation.

It appears to us that we have the proverbial ‘tail of the tiger’ and firmly believe that it is highly likely there are some pretty exciting intersections to be had at Corker by further drilling. It’s just a natural part of exploration – sometimes you get it easy, but most of the time you have to work harder and be more persistent to win the prize.

Has the VTEM survey provided any other potential targets for you to follow up?

We ended up with about 11 priority one targets, including Magnum and Corker, and 30 or so second and third order targets. That’s just from surveying 25 per cent of the Citadel project area or just 13 per cent of both projects combined.

At this stage we only have drilling ‘feedback’ from Corker and Magnum, both of which have proven to be strongly mineralised systems, an excellent proof of concept substantiating why we identified these Paterson Province projects as being high leverage exploration assets in the first place.

On that basis, once we have completed VTEM coverage, and additional exploration activities, over the entire 3000sqkm combined project area we anticipate to having a number of high calibre targets to drill.

So what are your plans for the immediate future?

At this stage our number one priority is to follow up the initial drilling success at Corker and to locate the thickened portions of that high-grade sulphide material.

We also intend testing a number of other targets that are situated within a couple of kilometres of both Magnum and Corker.