Firefly Resources Bitten by the Gold Bug

THE CONFERENCE CALLER: Having spun off its manganese assets into an oversubscribed IPO, Firefly Resources (ASX: FFR) is now set to devote its corporate attention to three predominantly gold exploration plays in Western Australia. By Mark Fraser

The first – which provided a “defining moment” in the company’s evolution when it acquired the asset last year and will take up most of its oxygen in the foreseeable future – is the historic Yalgoo gold project in the state’s Murchison, where the company holds 800 square kilometres of tenure covering real estate that has already yielded 140,000 gold ounces at a grade of 1.57 grams per tonne.

Over the coming year Firefly plans to drill 30,000 RC metres at Yalgoo as part of a resource upgrade. At the moment it has two rigs on site, with the company planning to employ a third rig during March.

The second cab off the rank is the Paterson copper-gold project in WA’s remote east Pilbara, which is currently at the early exploration stage.

Here, Firefly has around 600 square kilometres of highly prospective rocks in the under-explored Paterson Province. So far it has found some interesting copper-gold mineralisation less than 100m below surface – including grades of 6.5% copper, 1 gram per tonne gold and 900 parts per million molybdenum.

Finally, there’s the early stage Forrestonia gold project, which sits 380km east of Perth on the southern portion of the Forrestonia Greenstone Belt, where the company plans to follow up on some small discoveries at a later date.

For the time being, though, the focus is on Yalgoo, where the company is expecting to establish an update resource for the Melville gold deposit while advancing another seven firm gold prospects.

During the second day of the 2021 RIU Explorers Conference in WA, Firefly Resources managing director Simon Lawson said the company held almost 95 per cent of the upper northern part of the Yalgoo Greenstone Gold Belt.

“What I want to drive home to people is that we are pretty much alone on that belt, it’s already proven that it can produce gold and we have a number of different prospects that can become JORC 2012 resources very quickly,” he said.

In terms of the Melville deposit – which produced the aforementioned 140,000 ounces and was last subjected to a resource estimate in 2004 when the (Australian) gold price was $500 per ounce – Lawson noted that it contained thick high grade mineralisation in the main banded iron formation and further high-grade intercepts from 142m, reinforcing the recently discovered mineralised position both to the east and below the historic resource.

Furthermore, there was a broad mineralised oxide profile between the surface and 12m depth.

“One of the things we sort of discovered during the process of reviewing the old data, and during our own drilling, is that there is mineralisation from surface over a very extensive part of this ore body, and we are going to work on that as a separate model with the intention that we would like to commercialise that as an oxide gold opportunity,” Lawson explained.

Outside of Melville, Firefly has seven other prospects at Yalgoo with four of them (City of Melbourne, Brilliant, Lady Lydia, Prince George and Crescent) all having historic resources.

On the day before Lawson appeared at the RIU conference, Firefly announced it had spun out its Oakover manganese assets – located 80km east on Newman in WA – into a $5.5 million wholly-own IPO to be called Firebird Metals.

“The proposed IPO creates value from a non-core asset,” he added.

“Firefly shareholders will see the in-specie distribution of the shares in this company.

“Firefly won’t retain that value – we will give it to our shareholders. We will get a little bit of cash back from the initial IPO, but the majority of that will go out to our shareholders.”