THE CONFERENCE CALLER: Magnetic Resources (ASX: MAU) is proving to the market that not all major gold producing regions currently occupied by some of the world’s largest mining houses are exhausted from an exploration point-of-view. By Mark Fraser
The Western Australian-based company, which has 261 square kilometres of prospective real estate in WA’s Laverton region and another 213sqkm around Leonora, has made what it believes are a couple of major new gold discoveries in locations which, from all indications, seem to have been mostly overlooked by previous tenants.
First cab off the rank is Hawks Nest 9 (HN9), which sits only 15km north of Gold Fields’ Wallaby mine, 35km north of AngloGold Ashanti’s giant Sunrise Dam operation and 10km north west of Dacian Gold’s Jupiter deposit.
Here, Magnetic Resources’ exploration endeavours have demonstrated significant and coherent mineralisation over a 3km by 200 metre area that is still open and predominantly within the top 50m of cover, thus providing tremendous potential for deeper mineralisation
Within this 3km mineralised shear zone there are many shallow gold intersections, with 240 being greater than 1 gram per tonne, 89 higher than 2 grams per tonne, 44 more than 3 grams per tonne and 32 over 4 grams per tonne. To date, the company has drilled 723 RC holes for 39,740m.
Of particular interest is the Central Thickened Zone, where some thick gold intersections like 104m at 0.82 grams per tonne from 8m (including 20m at 2.23 grams per tonne from 95m) have been encountered.
These thickened zones have multiple stacked shallow dipping lodes similar to those at Wallaby, Jupiter and Sunrise Dam.
According to Magnetic Resources, a new thickened gold intersection of 90m at 0.37 grams per tonne from 80m (including 8m at 2.5 grams per tonne from 80m) was located 600m south of the Central Thickened Zone.
This intercept is only 60m north of another one of 7m at 3.04 grams per tonne from 108m.The areal extent of the mineralisation is growing in the southern direction and remains open both to the north east and at depth.
During the 20th RIU Explorers Conference held in Fremantle, Magnetic Resources’ managing director George Sakalidis said a large drill program of 98 holes for 11,937m was planned mainly to define an indicated resource within HN9 and extend the size of the new Southern Thickened Zone.
Meanwhile, sitting just 1.5km to the east is Lady Julie, where the tenements are strongly mineralised with 101 gold intercepts (1-19m) greater than 1 gram per tonne, including 34 being greater than 2 grams per tonne, 20 more than 4 grams per tonne and 13 over 4 grams per tonne.
So far, the prospect has been subjected to 131 RC holes for 7,196m.
Several of these mineralised zones were similar to HN9 and occurred within altered porphyry and altered porphyry and mafic contacts as well as, in some cases, sediment zones.
During his time at the RIU podium Sakalidis said HN9 – in combination with Lady Julie – represented an exciting large scale near-surface gold deposit.
The shallow gold and adjacent mining operations, he noted, were the unique point of difference for investors.
Ultimately, Magnetic Resources was looking to identify large economic gold deposits of 1 million gold ounces or more using the knowledge of the region’s geology and geophysics garnered by the current producers working there.
After his RIU presentation, Resources Roadhouse asked Sakalidis how was it that new gold discoveries could be made in a well looked over world class mining district (Leonora-Laverton) which had already yielded over 34Moz (mined and resources) and was second only to the Kalgoorlie-Boulder region in WA when it came to yellow metal endowment.
“Other companies that have looked at it obviously haven’t appreciated it or understood it – they haven’t understood it, so we have spent a lot of time and energy trying to understand what it all means,” he replied.
“There was some data (when Magnetic Resources first pegged the tenements), but it needed someone to drill it out to connect it all up.
“So, we went out in the field, and you can see with these old pits (on HN9) that they are only small, but they are also horizontal.
“So, one of the things that we noted was that a lot of the lodes carrying the gold in the large ore bodies are near horizontal. And that wasn’t recognised straight away, so that could be part of the reason. They (previous modern explorers) were looking for these big plunging deposits.
“Basically, HN9 sits on this one thrust plane, and that thrust plane goes down to 2km depth. The length of the thrust is about 4km, so this is a pretty significant stuff.
“These thrusts are bringing the mineralisation up. We can see a set of six thrusts over HN9, and we’ve really only investigated one of them. So fundamentally, now that we have done the seismic, we understand the geometry, and having a thrust plane bring up mineralisation is very significant.”
Sakalidis said Magnetic Resources’ current field program included some passive seismic work, which was being conducted over a much larger grid.
“What we are trying to do is get a pseudo 3D effect,” he explained.
“So, with these thrust zones, we know they occur on this line, but do they go directly north or do they go that way?
“We are trying to work out, by having a 3D effect, if you might be able to trace these going north.
“And that will be very important, because if they do intersect areas that we haven’t drilled, then they become a good target.”