Cassini Resources Holds Nickel Focus

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THE INSIDE STORY: Cassini Resources (ASX: CZI) continues to make steady progress on the company’s West Musgrave project (WMP) in Western Australia.

With Earn-in/Joint Venture partner Oz Minerals (ASX: OZL), Cassini is advancing Further Scoping Study (FSS) activities at the WMP.

This is the first stage of the Earn-in/JV Agreement between the two companies and aims to further reduce technical risk using metallurgical test work to update previous mining and processing studies to determine a mining operation returning maximum value.

“We will be drilling some areas of the known Resource, or extensions to the Resource that are high-grade, but are yet to be closed off by drilling,” Cassini Resources managing director Richard Bevan told The Resources Roadhouse.

“We expect to achieve some reasonable numbers, but the main objective is to identify any high-grade zones that could be introduced early into the mine plan.”

To date, the FSS remains on schedule for a quarter four 2017 finish.

Cassini has re-opened the camp at the WMP for the field activities, having obtained all heritage and environmental permits, allowing the JV to commence drilling activities.

Drilling is designed to test potential high-grade extensions to the WMP’s most advanced nickel targets, Nebo and Babel, with RC drilling to test several zones supported by coincident electromagnetic (EM) anomalies.

The JV considers any additional high-grade mineralisation will have a positive impact on project economics with results to form the basis of updated revised mine plans and schedules as part of an update of the geological interpretation. 

Energy, Water and Transport studies will update options for the, with an Infrastructure study already underway to buildon results of a Scoping Study completed by Cassini in 2015.

The objectives of the Energy Study are to evaluate conventional and renewable fuel options to facilitate the optimum processing throughput.

Cassini previously proposed a hybrid wind-diesel power solution and to this end a wind mast will be installed to collect baseline wind data. Hybrid solar-diesel options will also be considered in a desk top study.

An upcoming review of groundwater sources for the WMP will hope to identify local water options and assess key environmental issues for the project including an approvals pathway.

The study will incorporate two drill holes targeting nearby palaeochannels within the project area with potential to host water resources to satisfy the processing plant requirements.

As these palaeochannels are much closer to the proposed processing site than previously considered water sources they could offer a substantial capital cost saving.

The review of the transport logistics will comprise a review of all transport route options to identify a complete supply chain solution integrating incoming supplies with outgoing product.

Metallurgical test work commenced in January 2017 is expected to be completed in June with the aim of building on earlier results and to provide a higher level of confidence by representing a broader range of samples from the Nebo and Babel ore bodies.

The metallurgical program results will provide inputs into the Process Plant Design, which will start as soon as floatation test work is complete.

Cassini recently answered investor and shareholder queries by providing an insight into cobalt opportunities within the WMP.

Considering recent rises in the cobalt price and the implications for the project, the results demonstrated there was indeed a significant amount of contained cobalt in the Nebo–Babel deposits that would be produced as a by-product of nickel and copper production.

The Nebo-Babel deposits contain approximately 30,000 tonnes of cobalt, which Cassini claims to be competitively placed against other cobalt dominant projects.

In its 2015 Scoping Study, Cassini included market advice that cobalt within nickel concentrates was healthy enough to attract by-product credits and proposed approximately 500 tonnes per annum of cobalt in concentrate for the life of mine (+10 years).

The FSS work currently underway will include new mine optimisation and financial modelling, likely to include a higher long-term cobalt price than the previous study.

“We had received a lot of questions from shareholders and others about it, which is why we released the information to the market,” Bevan explained.

“The WMP is not a primary cobalt project, however, we do have good exposure to cobalt and increasing prices will provide upside through cobalt by-product credit revenue.”

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

HEAD OFFICE
10 Richardson 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

Thunderbird on Countdown to Construction

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THE INSIDE STORY: Sheffield Resources (ASX: SFX) has taken one large, and a few smaller steps towards hitting the construction phase of the company’s Thunderbird mineral sands project near Derby in northern Western Australia.

Before getting into details, it’s worth a quick look at the company’s more recent achievements at Thunderbird.

The large step taken by Sheffield was the completion of the project’s Bankable Feasibility Study (BFS) in March that ticked off some impressive figures, including:

A pre-tax NPV10 of $676 million and an IRR of 25 per cent;

EBITDA of $5.1 billion over a long Life of Mine of 42 years, offering leverage to multiple pricing cycles;

Stage 1 capital of $324 million plus $24 million contingency; and

Ore Reserves updated to 680.5 million tonnes at 11.3 per cent heavy mineral (HM) (Proved + Probable);

The updated Ore Reserve supports the project’s 42 year mine life with a very low life-of-mine strip ratio (waste:ore) of 0.78:1 and includes a Proved Ore Reserve category of 235.8 million tonnes at 13.3 per cent HM.

Once the BFS was close off Sheffield wasted little time in announcing it had signed three non-binding offtake Memorandums of Understanding (MoUs) for the premium zircon product to be produced from Thunderbird.

The company has environmental permitting on track following conclusion of a Public Environmental Review process with Native Title processes on schedule.

All this activity is supported by an enviable cash position of $11 million as at 31 March 2017.

The BFS was based on a conventional dozer trap mineral sands mining and processing operation.

“From an environmental side – in the actual mining and processing of it all – we will use a moving hole method so we move the hole forward and backfill behind,” Sheffield Resources managing director Bruce McFadzean told The Resources Roadhouse.

“We get to rehabilitate the mine as we go so there is no hole left once the mining is finished and we don’t use chemicals, except for acid which is neutralised into fertiliser in the rehabilitation process.”

The operation will incorporate an initial 8.5 million tonnes per annum throughput (single mining unit), doubling to 17 million tonnes per annum in Year 5 by way of the addition of a second mining unit and processing stream.

“It’s a big project,” McFadzean said.

“I don’t think I have been involved in a project in my entire career, which currently stand at 38 years, which possess these kinds of metrics.

“We have a 42-year mine life, potentially longer, for a project that has a mining and processing operation that is very environmentally friendly.”

From the extensive test work and process design carried out during the BFS and earlier studies, Sheffield has developed a suite of high quality mineral sands products with specifications suited to market requirements.

“The Thunderbird mine will primarily produce two benign products that everyone uses every day,” McFadzean explained.

“Everyone eats off crockery, sits on the toilet, or stands on tiles – that’s the zircon side.

“And on the titanium side – it’s the metal everyone puts inside their body for new hips and new knees.

“It’s in your toothpaste, it’s in your sunblock, you put it on your kids, so you don’t get any more benign products than that.”

The major commodity to be produced from Thunderbird will be the premium zircon, which will be a high quality ceramic grade zircon containing greater than 66 per cent zirconium dioxide (ZrO2).

The mine will also produce LTR Ilmenite; a pre-reduced, high-grade titanium dioxide (TiO2) ilmenite with low alkalis and low chromium that will be suitable as:

Feedstock for sulphate pigment plants – 56.1 per cent TiO2;

Production of chloride grade and sulphate grade slag – 88 per cent TiO2 with a high purity pig iron co-product; and

Potential blended feedstock for chloride processing. LTR Ilmenite can be produced at higher grades (57 to 59 per cent TiO2) for this potential market.

Other products include:

Hi-Ti88 – suited to the flux cored wire welding market, production of titanium sponge, or blended material for processing via the chloride process;

Zircon concentrate – zircon rich (44 per cent ZrO2, 20 per cent TiO2) suited to the zirconium chemicals industry, and further upgrading; and

Titano-magnetite – a co-product from the LTR process suited to furnace protection in the steel industry.

Test work undertaken during the BFS by Roundhill Engineering determined the LTR conditions required to reduce the iron (III) oxide (Fe2O3) content of the ilmenite product to less than 13 per cent.

Sheffield expects the production of an ilmenite product with these specifications to attract a further pricing premium in the Chinese market.

“Both products are forecast to be in deficit by 2020,” McFadzean said.

“From what we have heard, the market is factoring in Thunderbird coming online and as a result we have had very strong interest in the offtake.”

The strong interest culminated in the signing of three non-binding MoUs for the future sale of premium zircon from the Thunderbird project.

The first two MoUs were signed with an industry leading Indian ceramics company, Ruby Ceramics Pvt Ltd, and a well-established European ceramics company, CFM Minerales s.a. of Spain.

The combined agreements represent up to approximately 20 per cent of the estimated total volume of premium zircon expected to be produced from Stage 1 of the Thunderbird project.

The signing of the MoUs came after product testing and discussions between the parties, with all involved stating their intentions to finalise negotiations and enter binding offtake agreements.

“Signing these first MoUs with zircon consumers with a high standing in the industry, confirmed our capability of supplying the global market with very high quality products once in production,” McFadzean said.

“The BFS determined zircon will represent 62 per cent of the estimated project revenues and we look forward to advancing binding offtake agreements with both Ruby and CFM, as cornerstone premium zircon customers of the company.

Sheffield quickly followed up these signings with a third non-binding MoU with Sukaso Ceracolors Pvt Ltd, India’s largest ceramic raw materials supplier, which will account for approximately 20 per cent of the project’s estimated premium zircon.

“Establishment of these important relationships speaks volumes for the scale and quality of Thunderbird across the expected 42-year life of mine,” McFadzean said.

“Consumers are clearly positioning themselves to identify potential long term sources of supply for premium zircon product, and the MoU signed with Sukaso confirms Thunderbird’s capability and unique market position as a future source of very high quality products.”

As MoUs are being signed all over the place, Sheffield has continued to advance Environmental approval and Native Title processes with a Public Environmental Review (PER) opened for public comment during January and February.

The environmental approval process is scheduled to conclude in mid- 2017 and the Native Title process anticipated before mid-2017.

“We anticipate construction of the mine commencing this year, which is obviously all permitting dependent,” McFadzean said.

“We’re expecting permitting to be completed by Q3 and we can do – under the permitting – some pre-works under the approval of the DMP.

“We are maintaining a substantial engagement with a range of stakeholders throughout the Kimberley local community by conducting a series of BFS and PER information sessions and stakeholder briefings taking place.”

Sheffield Resources Limited (ASX: SFX)
…The Short Story

HEAD OFFICE
Level 2
41-47 Colin Street
West Perth WA 6005

Ph: + 61 8 6424 8440

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

DIRECTORS 
Will Burbury, Bruce McFadzean, Bruce McQuitty, David Archer

PepinNini Minerals Primes Argentine Lithium Projects

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THE INSIDE STORY: PepinNini Minerals (ASX: PNN) is exploring and developing a lithium brine resource and production project in Salta Province, Argentina, situated within the Lithium Triangle of South America.

Through its wholly-owned Argentine entity, PepinNini SA, PepiNini Minerals has accumulated a land holding of fourteen mining licences (mina), located in the western part of the Salta Province of NW Argentina, all of which are considered prospective for lithium brine aquifers associated with Salars (Salt lakes).

“We started accumulating ground by acquiring eight mining leases in the Salta Province in June 2016 with the aim of assembling a package of useful ground, prospective for the exploration of lithium brine,” PepinNini Minerals managing director Rebecca Holland-Kennedy told The Resources Roadhouse.

PepinNini recently completed a geophysical survey on the Cauchari project, which was commenced after the release of encouraging sampling and geophysical results from the neighbouring Pocitos, Arizaro, and Pular projects that indicated the presence of thick aquifer layers with potential for lithium brine close to the surface.

“The work we have carried out to date involved the completion of geophysical surveys over four salars, with a study currently in train over a fifth,” Holland-Kennedy explained.

“The results we have achieved to date have been extremely encouraging to the point where we are now preparing a drilling program at the Salar Pocitos project with the objective being to have defined a lithium carbonate Resource by the end of this year.”

The results from the Cauchari survey were consistent with those from the earlier studies, suggesting the presence of a thick conductive layer of saturated sediments likely to contain lithium brine.

These have been identified as being close to the surface of the Cauchari mining lease, across a four-kilometre band ranging in thickness from 192 metres to 261m from depths of 32m to 132m.

One important aspect of the Cauchari results is the sediment thicknesses being the highest PepinNini has encountered in all sampling so far, which the company considers to auger well for the next stage of exploration, which will be drilling.

PepinNini is by no means the only lithium play in the region – the company’s Cauchari project spans 3,500 hectares within two minas Guayos II and III, on the west side of the Salar de Cauchari, while the northern end of the salar is under development by Canadian TSX-listed firm Lithium Americas.

Lithium Americas has defined Proven and Probable Reserves of 1.5 million tonnes of lithium carbonate equivalent at an average grade of almost 700 milligrams per litre and recently reported a favourable feasibility study to develop the first phase of a 40-year project at 25,000 tonnes per annum.

“That would suggest that we are in the right neighbourhood and that very real potential exists for our Cauchari project,” Holland-Kennedy said.

“We are increasingly confident most of the 14 leases over which we have exploration rights will prove workable.”

PepinNini has made considerable progress on the Salta project since commencing geophysical survey work last October, the outcome of which is several sets of either surface sampling or geophysical survey results to work with, and from what it has achieved, the signs are good.

“The exciting thing is the geophysics work we have conducted to date has confirmed the existence of aquifers beneath all our mining leases surveyed that potentially host lithium brines,” Holland-Kennedy said.

“Our next phase of work will be the drilling to confirm the actual lithium grade.

“We are keen to define a lithium Resource within this calendar year and we are on track to do that.”

PepinNini’s next phase of exploration will involve drilling, as well as pumping and sampling on the Pocitos project to clarify the hydro-geological properties of the aquifers in line with the relevant guidelines to define a Resource.

That, of course, requires funding, and to that end PepinNini recently announced an entitlements issue for shareholders aiming to raise $2.3 million.

The funds will be used for upcoming work programs at the Salta lithium projects, including drilling boreholes for aquifer testing and brine grades, further sample analysis, and pumping testing of boreholes to determine hydraulic properties.

“We believe the Salta lithium project in Argentina has enormous potential,” Holland-Kennedy said.

“The entitlement issue offers our shareholders a further opportunity to share that potential.”

PepinNini Minerals Limited (ASX: PNN)
… The Short Story

HEAD OFFICE
Level 6
108 King William St
Adelaide SA 5000

Ph: +61 8 8218 5000

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

DIRECTORS
In Australia: Rebecca Holland-Kennedy, Philip Clifford, Robert WeiSun, Sarah Clifton-Brown
 
In Argentina: Ignacio Celorrio and Company Secretary, Justin Nelson

St Barbara Stake Strengthens Peel Mining’s Cobar Basin Resolve

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THE INSIDE STORY: Peel Mining’s belief in the Cobar Basin region of New South Wales was further validated recently by an equity investment from established ASX-listed gold producer and explorer St Barbara Limited (ASX: SBM).

Peel Mining welcomed St Barbara to its share register after the latter subscribed for $3.28 million worth shares at, what was at the time, a healthy premium subscription price of 20.5 cents per share giving St Barbara an approximate 9.5 per cent stake in the company.

“Attracting a company of the calibre of St Barbara to the share register is additional validation of the belief we have placed in the mineral potential of Cobar Basin since we first began exploring in the region back in 2010,” Peel Mining managing director Rob Tyson told The Resources Roadhouse.

“Obviously, the funding from the deal is good for the company as it means we are now well-funded to continue our exploration programs at Mallee Bull, Wagga Tank, and a number of other high priority prospects.”

“The extra bonus will be the depth of knowledge we will be able to draw on by tapping into St Barbara’s extensive experience in deep, underground mining at Gwalia.

“We believe that technical expertise is highly applicable to Cobar-style deposits, which typically show strong vertical continuity.”

Peel Mining is NSW’s predominant greenfield’s explorer having established the largest single-company tenure holding in the Cobar Superbasin on its way to discovering and defining several important base and precious metal-rich deposits.

These include the high-grade Mallee Bull copper-polymetallic resource and the company’s Wagga Tank gold-polymetallic and Wirlong copper discoveries.

Peel intends putting the new funds to work accelerating its upcoming Cobar Basin work programs, which includes further drilling at the 100 per cent-owned Wagga Tank VMS prospect, scheduled to recommence in April.

Results from the maiden drilling program undertaken at Wagga Tank revealed highly encouraging intercepts, which Peel interpreted to demonstrate the presence of additional high-grade base and precious metal mineralisation.

The program completed 18 drillholes with at least seven drillholes requiring extensions, producing highlights of:
 
WTRC003
27 metres at 10 per cent zinc, 6.41 per cent lead, 89 grams per tonne silver, 0.42g/t gold, 0.21 per cent copper from 240m (end of hole), including 10m at 19.39 per cent zinc, 12.35 per cent lead, 171g/t silver, 0.67g/t gold, 0.30 per cent copper from 253m; and

WTRC017
16m at 3.27g/t gold, 0.35 per cent copper, 1.1 per cent zinc, 0.57 per cent lead, 12g/t silver from 226m, including 10m at 4.27g/t gold, 0.37 per cent copper, 0.88 per cent zinc, 0.52 per cent lead, 13g/t silver from 228m, and;

13m at 3.34g/t gold, 0.83 per cent copper, 0.77 per cent zinc, 0.28 per cent lead, 20g/t silver from 299m, including 6m at 6.9g/t gold, 1.28 per cent copper, 0.62 per cent zinc, 0.21 per cent lead, 29g/t silver from 300m.

“Now that we have these funds we can get back out to Wagga Tank sooner than we expected,” Tyson said.

“Once the rig that is currently drilling a deep hole at Wirlong has finished, we will mobilise it to Wagga Tank to complete the drill program we started prior to Christmas.

“The program will likely include follow up drilling of several strong gold-copper intersections that we previously reported that could possibly represent a previously unrecognised feeder structure to the historically reported oxide gold mineralisation.”

Drilling has also been continuing at the JOGMEC-funded Wirlong copper discovery.

The program recently produced the best copper intercept Peel has reported to date at the 60 per cent-owned Wirlong prospect.

The intercept of 17m at 4.59 per cent copper and 8 grams per tonne silver from 738m, achieved in drillhole WLRRCDD043, extended the down-dip continuity of strong copper mineralisation at Wirlong to approximately 600m below surface.

“Significantly, a substantial ‘offhole’ downhole electromagnetic geophysical anomaly centred north of WLRCDD043 points to possible extensions to substantial copper mineralisation,” Tyson said.

“Our ultimate goal is to build a camp of deposits in the Cobar Basin, and Wagga Tank and Wirlong have added new strings to our bow.

“However, Mallee Bull remains our core asset where drilling has recommenced at the T1 prospect targeting very high-grade zinc-lead-silver mineralisation for metallurgical testwork purposes.”

Peel Mining Ltd. (ASX: PEX)
… The Short Story

HEAD OFFICE
Unit 1
34 Kings Park Road
West Perth WA 6005

Ph: (08) 9382 3955

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

DIRECTORS
Rob Tyson, Simon Hadfield, Graham Hardie

Alliance Resources Wilcherry Picking Gold and Tin

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THE INSIDE STORY: In 2016, Alliance Resources’ (ASX: AGS) search for a flagship project culminated in the acquisition of 51 per cent of the Wilcherry project Joint Venture with Tyranna Resources (ASX: TYX).

The Wilcherry project is located within the Gawler Craton in the northern Eyre Peninsula in South Australia.

“We acquired direct equity of 51 per cent in a JV with Tyranna Resources, which wished to retain equity in the project,” Alliance Resources managing director Steve Johnston told The Resources Roadhouse.

“We gained access to the Wilcherry assay data base and, all these gold results kept popping up at Weednanna.”

Alliance has developed a two-pronged approach to the target, the first testing the gold potential of the Weednanna project, the most advanced gold prospect in the Wilcherry project area.

Previous owners identified a gold-in-calcrete anomaly coincident with a NNW-trending magnetic anomaly and gold mineralisation associated with skarn alteration and brecciation, however, the geological distribution of the gold was poorly understood.

Alliance re-logged all available RC chips and diamond core from Weednanna, designing an RC drilling program to test the strike, dip, and plunge continuity of three possible high-grade gold mineralised shoots referred to as Targets 1, 2 and 3, completing a total of 24 RC holes.

“This was our first drilling program at the project and we basically focused on the previously identified high-grades to see what we could find there,” Johnston said.

In the first three target areas some 15 of the 24 holes Alliance drilled returned highly-encouraging results including:

At Target 3

17WDRC017
14 metres at 36.1 grams per tonne gold from 118m, including 5m at 95.6g/t gold from 120m; and

7m at 7.4g/t gold from 147m, including 1m at 40g/t gold from 149m.

17WDRC021
3m at 5.5g/t gold in hole from 144m.

17WDRC022 
3m at 3.1g/t gold from 84m.

Intercepts at Targets 1 and 2 returned:

17WDRC003
49m at 6.3g/t gold from 45m, including 21m at 10.7g/t gold from 48m.

17WDRC012
2m at 61.1g/t gold from 167m.

17WDRC011
10m at 6.8g/t gold from 79m, including 3m at 15.5g/t gold from 81m.

17WDRC013
7m at 11g/t gold from 82m, including 4m at 17.6g/t gold from 84m.

17WDRC014
1m at 20.5g/t gold from 120m.

17WDRC015
1m at 16.2g/t gold from 99m.

Thirteen out of 16 holes from Targets 1 and 2 reported intercepts greater than 1g/t gold.

“The gold intercepts were amongst the best grades reported from Weednanna and highlight the mineral potential of the prospect,” Johnston said.

“We couldn’t have hoped for better results and what we have learned, at this stage, is that the overall low-grade envelope of the deposit, spread out over approximately 1.3 kilometres in strike, has these high-grade patches.

“We feel that past explorers didn’t really focus enough attention on the high-grades and think some of the high-grade mineralisation is running at a shallow angle to the original east-west drilling sections.

“Next time we drill we will turn the rig around from the north to drill these high-grade targets and hopefully get a much better understanding as we try to model the deposit in the hope of establishing enough tonnes to form an operation.”

Alliance’s second Wilcherry prong came in the form of a further data set it received as part of the JV for base metal potential.

This was augmented by a Heli-EM survey that produced several potential conductors, one of which is proximal to 2012 tin intercepts at Zealous, and another at the historic zinc-lead-silver prospect at Telephone Dam.

The MLEM survey confirmed the presence of weak bedrock conductors consistent with data from a previous helicopter electromagnetic (HEM) and at Telephone Dam clearly confirmed the presence of weak bedrock conductors consistent with the HEM anomalism.

“A ground MLEM survey validated the targets giving us five holes to be drilled at Zealous and three at Telephone Dam,” Johnston said.

“We will be drilling this before Weednanna, as we feel that if we hit something interesting with these holes we expect the base metals would provide the company with a greater initial push than the gold.

“Weednanna is an outstanding development opportunity and is the company’s gold focus, but there are also some wonderful historic tin results at Zealous that we need to pursue.”

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

Rox Resources Ready to Roll with Returns from Reward

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THE INSIDE STORY: Rox Resources (ASX: RXL) is happily perched on the nest egg of cash it received after divesting the company’s interest in the Reward zinc project in the Northern Territory.

Rox Resources completed the sale of Reward to Teck Australia Pty Ltd earlier this year, banking around $16 million with another $3.75 million to come in six years, for a total of $19.7 million.

Cashed-up, Rox is eager to add to its portfolio of prospective nickel and gold projects and to get out and explore.

“We have that money sitting in the bank and are looking at acquiring new opportunities,” Rox Resources managing director Ian Mulholland told The Resources Roadhouse.

“Having said that, we won’t be rushed into making a rash acquisition and will be fairly circumspect with regard to what opportunities are available.

“Obviously, we do want to get on with life and the reason we sold our interest in the Reward project was so we can do just that.

“But, we are not going to buy something just for the sake of buying, just because the market may be getting impatient and expecting us to do so.

“It has to be something worthwhile, and that, as we all know, is not always easy to find – if it was everybody would be doing it.”

Rox set its new acquisition trend last year when it picked up 100 percent ownership of the Collurabbie nickel- gold-copper-PGE project in the highly prospective North Eastern Goldfields region of Western Australia.

Collurabbie hosts the Olympia nickel sulphide deposit, where historical drilling results included: 5.8 metres at 3 per cent nickel, 2 per cent copper and 5.3 grams per tonne PGE.

Beside Olympia, Collurabbie hosts several strong prospects, such as Agora, Leros, Paros and Rhodes (East and West) where previous exploration identified mineralisation that never really received any substantial follow-up work.

The Collurabbie project tenements are situated just 70km due east of Rox’s Fisher East nickel sulphide and Mt Fisher gold projects, where the company considers there to be clear development synergies.

At Fisher East, Mineral Resources have been defined across the Camelwood, Cannonball and Musket deposits of 2.1 million tonnes at 2.5 percent nickel containing 52,000 tonnes of contained nickel.

A program of RC drilling is planned for the Horatio, Mt Tate, Cutlass, and Sabre North prospects.

Sabre is emerging as the ‘next big thing’ at Fisher East where Rox is planning a round of diamond drilling to progress it towards the definition of a maiden resource.

To date, Sabre has only received relatively shallow RC drilling, with a best intersection so far of 10 metres at 1.9 per cent nickel.

Most of the known EM conductor at Sabre has not been tested by deeper drilling.

“We have a drilling program that will be testing six targets that we are extremely keen on,” Mulholland said.

“We are fairly confident that at least two or three, hopefully more, are going to hit something.

“The aircore drilling we have already completed has indicated these to be good targets.”

Rox has also signed a Joint Venture with Doray Minerals (ASX: DRM) to explore the Mt Fisher gold tenements in 2016, under which Doray was required to spend $1 million within the first year.

Following that Doray can spend $4 million over a further two years to earn a 51 per cent interest, and increase its interest to 75 per cent by expenditure of a further $5 million over an additional two years.

Doray’s drilling at Mt Fisher has been hampered by unseasonably wet weather, but a recently commenced aircore drilling program of approximately 16,000m is targeting interpreted zones of possible gold mineralisation located in favourable structural positions.

These targets were developed by Doray following a gravity survey undertaken last year as well as a structural analysis of geophysical and geological data.

“We are looking forward to the results of this drilling program,” Mulholland said.

“This is just the first of several exploration programs we have scheduled to commence this year.

“Other drilling includes RC drilling at Fisher East, which will be followed by a planned diamond drilling program.

“We are also planning an aircore drilling program scheduled to commence at Collurabie in June.”

Rox Resources Limited (ASX: RXL)
…The Short Story

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

Ph: +61 8 9226 0044

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

DIRECTORS
Stephen Dennis, Ian Mulholland, Brett Dickson

Tyranna Resources Seeks New Challenger

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THE INSIDE STORY: Tyranna Resources emerged from the merger of Ironclad Mining and Trafford Resources as a new company focused on gold and advancing the company’s Jumbuck gold project in South Australia.

Tyranna Resources is manager of the Western Gawler Craton Joint Venture (WGCJV) with the owner-operator of the Challenger gold mine, WPG Resources (ASX: WPG) (TYX 72% – WPG 28%).

Tyranna controls seven project areas – four to the north and three to the south of the Challenger gold mine.

It is the southern project areas, particularly Typhoon and Monsoon where historic drilling demonstrated these higher-grade prospects to be more likely to provide Tyranna with a higher-grade Resource as they are closer to surface.

“In other words, they resemble Challenger more so than the areas to the north,” Tyranna Resources managing director Bruno Seneque told The Resources Roadhouse.

“At Typhoon, for example, the garnet-biotite gneiss host rock for the mineralisation outcrops, as it does at Challenger.

“We gained access to, and heritage clearance over Typhoon and Monsoon earlier this year, but while we were waiting for that to happen we took the opportunity to drill at the Golf Bore, Greenewood, and Mainwood, and Campfire Bore projects to the north.”

Tyranna was encouraged by the results achieved on the northern projects, particularly Greenewood where it established a Resource of around 23,000 ounces of gold, contributing to the northern project package total of 219,000 ounces.

The company has taken many lessons from the discovery of the Challenger mine, which came off the back of gold situated in calcrete, a naturally occurring concrete like substance that absorbs minerals.

“If you find gold in calcrete, even at very low levels, the idea is to hone in on it, and that’s how they found Challenger,” Seneque continued.

“It is different to the Goldfields where the gold host-rock outcrops and you get gold at surface.

“Initially our endeavours to locate gold in calcrete on the northern projects was relatively unsuccessful, but after an intense period of Research and Development work, Greenewood – where there is no outcropping calcrete – became our first gold discovery and the first major gold discovery in the area for around 18 years.

“This Resource has a global grade of 1 gram per tonne at a 0.5-gram cut-off, bit if we use a 0.8-gram cut-off it has a 1.4 grams per tonne head grade.\

“That’s ideal for the Challenger processing plant as an ore supplement, but based on the historic drilling carried out by previous owners, we believe the ore to the south will have a higher grade.”

Tyranna recently completed first pass reverse circulation (RC) drilling at the Typhoon gold prospect, from which its field geologists noted the weathering profile at Typhoon to be deeper than the northern Jumbuck project area.

The average depth to the fresh rock measured around 65m from surface, compared to the northern project area where the fresh rock interface is approximately 40m from surface.

The company is confident of understanding the deeper weathering profile as results roll in from the first pass drilling at Typhoon, though it is encouraged by the knowledge that the Challenger deposit also shared this characteristic.

With drilling completed at Typhoon, Tyranna has moved the rig to its second prospective nearby target at Monsoon.

At Monsoon, Tyranna has identified a further resemblance to Challenger in the form of a big fold structure, within which is a hinge hosting the bonanza gold.

This was tested by previous owners, Dominion Gold and Southern Gold using aircore and RAB drilling, providing Tyranna with results to follow.

“What we are doing with Monsoon, and what we like about it, is the hinge on the fold structure, which is where we are targeting our drilling, because that hinge really hasn’t been tested properly previously,” Seneque said.

“We are drilling structures and drilling them deeper in areas where mineralisation has already been identified – we’re drilling it, we’re finding the high-grade zones and we’re chasing them.

“There can’t just be one Challenger out there so we’re exploring for large high-grade gold deposits.

“We’re within trucking distance of a mine that has produced one million ounces of gold, and we have a proven track record of discovery.”
 


Tyranna Resources Limited (ASX: TYX)
… The Short Story


HEAD OFFICE

Level 2
679 Murray Street
West Perth WA 6005

Ph: (08) 9485 31040

Email: info@tyrannaresources.com
Web: www.tyrannaresources.com


DIRECTORS
Joseph Pinto, Bruno Seneque, Nick Revell, Frank Lesko

Avalon Minerals Farms-in to Ecuadorian Gold-Copper Concession

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THE BOURSE WHISPERER: Avalon Minerals (ASX: AVI) has signed a Binding Letter Agreement with Cornerstone Capital Resources through its subsidiary La Plata Minerales S.A. (PLAMIN).

Avalon Minerals will have the right to earn a majority interest in the 4,949 hectare Bramaderos concession in southern Ecuador, subject to satisfaction of certain conditions.

Avalon said the Bramaderos concession contains fertile mineralised systems, which the company considers having strong potential to host a world-class discovery.

Historical results from Bramaderos include wide intervals such as:

260 metres at 0.6 grams per tonne gold and 0.14 per cent copper in diamond drilling; and

42m at 3.7g/t gold in surface trenching.

 “Avalon is excited about working with Cornerstone and advancing the Bramaderos opportunity,” Avalon Minerals CEO Malcom Norris said in the company’s announcement to the Australian Securities Exchange.

“The Avalon team has worked previously with Cornerstone on other projects in Ecuador which have led to significant discoveries and shareholder value growth, and we will work towards repeating that success at Bramaderos.

“The Avalon team is keen to apply its exploration approach developed at Tujuh Bukit in Indonesia and Cascabel in Ecuador to the Bramaderos opportunity.”

Email: info@avalonminerals.com.au

Website: www.avalonminerals.com.au

Ironbark Zinc Ready to Meet Demand

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THE INSIDE STORY: If our Prime Minister was to pay as much attention to the resources sector as he should, he would most probably declare that we are currently in a very exciting time to be a near-term zinc producer.

Global zinc demand is being forecast to increase on the back of the closure of major mines in recent years.

The list includes some heavy-hitting producers, including the Century mine (500,000 tonnes per annum), Brunswick (200,000tpa), Perseverance (128,000tpa), and Lisheen (167,000tpa), contributing a huge expected shortfall in the immediate future.

The zinc price has responded accordingly with a near 60 per cent price rise in the past 12 months.

Enter Ironbark Zinc (ASX: IBG), which is developing its 100 per cent-owned Citronen base metal project in Greenland.

The Citronen project boasts a JOCR 2012-compliant Measured and Indicated, high-grade Resource of 30 million tonnes at 7.1 per cent zinc within a total Measured, Indicated and Inferred Resource of 132 million tonnes at 4.4 per cent zinc and lead.

In a recent research note, industry analysts Hartleys ran its eyes over the latest numbers for Citronen and came up with some impressive calculations for the project.

Hartleys estimates pre-tax NPV of $650 million on spot prices, assuming a capex spend of around US$500 million over two years.

Using a zinc price profile lower than spot, Hartelys calculated pretax NPV at approximately $230 million.

At spot prices, this pretax valuation came in at around $650 million with Hartleys estimating an average generation of $200 million EBITDA per annum.

“We have seen credible forecasts for zinc to peak near US$1.80 per pound,” Hartleys said.

“While forecasters do not anticipate zinc could remain at such levels for long, we estimate that IBG could generate A$500 to A$600 million EBITDA per annum if zinc held that level in the early years of production. 

“At such prices, capital payback would be less than two years.”

Ironbark Zinc took a major step in the development of Citronen earlier this year, when it was granted a Mining Permit for the project by the government of Greenland.

The importance of the Mining Permit should not be overlooked as it provides Ironbark the right to mine the world-class project for a period of 30 years.

“The granting of the Mining Permit has been a long time coming, but the benefits it brings to the project make it well worth the wait and all the hard work we put into achieving it,” Ironbark Zinc managing director Jonathan Downes told The Resources Roadhouse.

“It provides us with the platform to move forward with the development of the project and brings us closer to realising our goal of becoming a major mid-tier mining company.

“Although we may have fallen off the radar screens of some investors, our timing in receiving the Mining Permit could not have been much better, given it coincides with a period of growing tightness in global zinc supply and demand dynamics and a corresponding rise in the zinc price.

“We are now very keen to advance development and financing activities that will pave the way for the company to become one of the world’s largest zinc mining companies.”

Ironbark didn’t waste much time heading down that track by striking an agreement with China Nonferrous Metal Industry’s Foreign Engineering and Construction Co., Ltd (NFC).

Under the agreement, Ironbark appointed NFC to incorporate current Chinese equipment and construction costs into the Citronen Feasibility Study.

NFC will also prepare a project study report in compliance with the financing requirement of China’s banks, while ensuring technical criteria follows local laws, regulations, standards and codes in both Greenland and China.

NFC will also be charged with helping Ironbark secure Chinese project debt financing for the project under the terms of an earlier Memorandum of Understanding.

“We consider NFC to be an ideal fit for development of the Citronen project,” Downes said.

“They are one of the world’s largest construction engineering groups and have the relevant experience and the capability to provide key equipment for the project.

“Most importantly, NFC has a strong relationship with the Chinese banking sector that we expect to provide an excellent basis to achieve debt funding objectives for 70 per cent of the capital for Citronen.”


Ironbark Zinc Limited (ASX: IBG)
…The Short Story


HEAD OFFICE
Level 1
329 Hay Street
Subiaco WA  6008

Ph: +61 8 6461 6350

Email: info@ironbark.gl
Web: www.ironbark.gl


DIRECTORS
Jonathan Downes, Peter Duncombe Bennetto, David Kelly, Gary Comb, Jason Dunning

WPG Resources Drilling at Challenger Deeps

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THE DRILL SERGEANT: WPG Resources (ASX: WPG) commenced drilling in the Challenger Deeps area, situated below the 215 shear, which displaces the mineralised system of the company’s Challenger gold mine in South Australia.

WPG Resources said the drilling was being carried out in anticipation of mining activities commencing later in the year.

The company explained the drilling is being conducted from collars developed in underground cuddies near the bottom of the current workings and follows completion of a modification to the primary ventilation upgrade works at Challenger in March.

Drilling is set to test the M1 and M2 lodes immediately below the 215 shear and will also target the Challenger West lode, which has not previously been drilled below the 215 shear.

WPG Resources outlined its goals for this drilling program to be to assist with planning mining activities and to add to existing mineral resource and ore reserves estimates.

The company will use the results from Phase 1 of this systematic drilling program to plan initial mining activities at Challenger Deeps.

“this systematic drilling program, commencing on schedule, is the next major step in our plans to mine Challenger below the 215 shear,” WPG Resources executive chairman Bob Duffin said in the company’s announcement to the Australian Securities Exchange.

WPG Resources anticipates mining of the main Challenger deposit and now Challenger Deeps to occur in parallel with progression of other near mine exploration opportunities that can be accessed from existing underground development.

These include Challenger West, Challenger South South West (CSSW), Aminus, Enterprise, Challenger North West and M3/SEZ.

Email: info@wpgresources.com.au

Website: www.wpgresources.com.au