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Middle Island Resources’ Bid for Alto Metals Hits the Wall

THE BOURSE WHISPERER: To quote The Eagles, “It seems like a dream now, it was so long ago”, but it was only in March this year the Middle Island Resources (ASX: MDI) provided Alto Metals (ASX: AME) shareholders something to ponder by announcing its intention of an all scrip off‐market take‐over offer for all the issued ordinary shares of Alto Metals.

Back then, Middle Island Resources said it had formed the view that the combination of the assets of the two companies would create, among other material benefits to the shareholders, a company with near-term cash flow potential and considerable production and exploration upside.

The company said the all scrip off-market takeover offer would give Alto shareholders five Middle Island ordinary shares for each Alto ordinary share, which the hunter said valued its prey at approximately $9.4 million representing a 61 per cent premium over Alto’s last closing price at the time.

According to Middle Island this upside would include access to its processing plant, even though it is currently on care and maintenance, saying this would provide Alto shareholders with an immediate, proximal and cost-effective processing solution for their company’s gold resources that is not otherwise available.

Middle Island is keen to restart its Sandstone gold processing plant and clearly the Alto deposits would provide initial mill feed and critical mass to support its early recommissioning in conjunction with the former’s Two Mile Hill deposits.

Middle Island declared it has received indicative broker support with respect to the takeover for an equity capital raising of approximately $5 million in additional funds to advance the feasibility and recommissioning of the Sandstone plant. Claiming the combination of Middle Island and Alto will consolidate the entire Sandstone greenstone belt and dataset under a single entity.

“Middle Island’s offer is compelling for Alto shareholders, who will receive a significant premium based on the last closing price for their shares and will benefit in the future growth potential of the proposed Combined Group,” Middle Island Resources managing director Rick Yeates said in the company’s announcement to the Australian Securities Exchange.

“Middle Island will integrate Alto’s assets with Middle Island’s Sandstone gold project, and immediately embark on an updated feasibility study, incorporating Alto’s Mineral Resources, to determine the economics of recommissioning the Sandstone gold processing plant.

“The collective Middle Island‐Alto gold assets offer a substantial growth opportunity for current and future shareholders of the Combined Group, via low capital intensity and a near-term production profile.

“The further potential is to significantly extend this production profile via Middle Island’s Two Mile Hill underground deposits, consolidate further proximal deposits within a 100 kilometre radius, and amalgamate an entire greenstone belt offering significant resource and exploration upside.

“In the view of the Middle Island directors, the premium offered, the funding support, Middle Island’s technical and management expertise, and participation in the combined Middle Island‐Alto upside, makes the bid a compelling proposal.”

The Resources Roadhouse spoke to Rick Yeats when both attended the RIU Resources Roadshow in Melbourne.

The deal, howver, failed to gain traction and Middle Island this week announced its off-market takeover bid for fully paid ordinary shares Alto Metals has lapsed.

The reason being that Middle Island’s 50 per cent minimum acceptance condition, to which the Offer was subject, had not been met as of close of the Offer period at 5.00pm (Perth time), Friday, 29 November 2019.

Middle Island thanked those Alto shareholders who had taken up the offer, acknowledging that as the offer had lapsed, they would have their Alto shares returned.

Undeterred, Middle Island said it strongly believes that combining Middle Island and Alto’s gold assets offers a substantial growth opportunity for current and future shareholders of a combined entity.

The company declared the combined entity would have low start-up costs and near-term gold production, utilising Middle Island’s existing Sandstone gold processing plant and infrastructure, along with the consolidation of healthy gold resource upside and exploration potential within the combined entity’s highly complementary tenure.

Middle Island made note that over the past two years, it has unsuccessfully endeavoured to engage the Alto Board on what it considers is a clear, compelling and commercially logical strategy that is widely endorsed by all stakeholders.

Middle Island indicated it intends to continue to pursue meaningful dialogue with the Alto Board of Directors as it seeks to add value for both Alto and MDI shareholders.

 

 

Middle Island Resources Launches Takeover Bid on Alto Metals

THE BOURSE WHISPERER: Middle Island Resources (ASX: MDI) provided Alto Metals (ASX: AME) shareholders something to ponder over the weekend by announcing its intention of an all scrip off‐market take‐over offer for all the issued ordinary shares of Alto Metals.

Middle Island Resources said it had formed the view that the combination of the assets of the two companies would create, among other material benefits to the shareholders, a company with near-term cash flow potential and considerable production and exploration upside.

The all scrip off-market takeover offer will give Alto shareholders five Middle Island ordinary shares for each Alto ordinary share, which the hunter said values its prey at approximately $9.4 million representing a 61 per cent premium over Alto’s last closing price.

According to Middle Island this upside would include access to its processing plant, even though it is currently on care and maintenance, saying this would provide Alto shareholders with an immediate, proximal and cost-effective processing solution for their company’s gold resources that is not otherwise available.

Middle Island is keen to restart its Sandstone gold processing plant and clearly the Alto deposits would provide initial mill feed and critical mass to support its early recommissioning in conjunction with the former’s Two Mile Hill deposits.

Middle Island declared it has received indicative broker support with respect to the takeover for an equity capital raising of approximately $5 million in additional funds to advance the feasibility and recommissioning of the Sandstone plant. Claiming the combination of Middle Island and Alto will consolidate the entire Sandstone greenstone belt and dataset under a single entity.

“Middle Island’s offer is compelling for Alto shareholders, who will receive a significant premium based on the last closing price for their shares and will benefit in the future growth potential of the proposed Combined Group,” Middle Island Resources managing director Rick Yeates said in the company’s announcement to the Australian Securities Exchange.

“Middle Island will integrate Alto’s assets with Middle Island’s Sandstone gold project, and immediately embark on an updated feasibility study, incorporating Alto’s Mineral Resources, to determine the economics of recommissioning the Sandstone gold processing plant.

“The collective Middle Island‐Alto gold assets offer a substantial growth opportunity for current and future shareholders of the Combined Group, via low capital intensity and a near-term production profile.

“The further potential is to significantly extend this production profile via Middle Island’s Two Mile Hill underground deposits, consolidate further proximal deposits within a 100 kilometre radius, and amalgamate an entire greenstone belt offering significant resource and exploration upside.

“In the view of the Middle Island directors, the premium offered, the funding support, Middle Island’s technical and management expertise, and participation in the combined Middle Island‐Alto upside, makes the bid a compelling proposal.”

As The Roadhouse was going to print there had been no on-market response from Alto Metals, but we will keep an eye out for further developments.

 

Website: www.middleisland.com.au

 

Alto Metals Confirms Gold at Depth at Vangaurd

THE DRILL SERGEANT: Alto Metals (ASX: AME) recently drilled two 2 RC holes at the Vanguard and Tiger Moth prospects of the company’s Sandstone gold project in Western Australia.

Alto Metals reported that assay results from these holes confirmed geological models and provided samples for preliminary metallurgical testwork, which subsequently returned high recoveries and better than predicted grades.

The company said that assay results received from reconnaissance aircore drilling at Bulchina, Sandstone North and Vanguard Camp also indicates that these mineralised systems are still open, and further drilling is required.

The RC drilling confirmed robust geological models at Vanguard and Tiger Moth returning intercepts into high-grade zones including:

SRC114 (Vanguard)

40 metres at 3.5 grams per tonne gold from 60m; and

SRC115 (Tiger Moth)

8m at 4.1g/t gold from 52m.

The preliminary metallurgical testwork shows recovery of +92 per cent gold from both oxide and primary gold zones.

“Alto’s recently published Mineral Resource estimate [JORC 2012] for the Indomitable and Vanguard Camps was the result of applying a systematic exploration approach,” Alto Metals managing director Dermot Ryan said in the company’s announcement to the Australian Securities Exchange.

“This process resulted in the selection and successful testing of a number of litho-structural gold targets.

“The next stage is to step-out and drill test the down dip/down plunge extensions of these newly discovered mineralised structures and convert gold mineralisation into mineral resource.”

 

Email: admin@altometals.com.au

Website: www.altometals.com.au

 

Alto Metals Lodges Mining Lease Applications

THE BOURSE WHISPERER: Alto Metals has lodge a Mining Lease Application (MLA) over the Indomitable Camp deposits at the company’s Sandstone gold project in Western Australia.

Alto Metals has lodged the application, confident of a positive outcome to the current Scoping Study being carried out on the deposits.

Results from aircore drilling programs in 2017 and 2018 have led Alto to consider there to be an opportunity to commence open pit mining operations over several shallow oxide and primary gold deposits in the project’s Indomitable and Vanguard Camps.

“Alto has commissioned Carras Mining Pty Ltd to undertake Mineral Resource estimates of Tiger Moth, Piper, Indomitable and Vanguard, to form the basis of scoping study,” Alto Metals said in its ASX announcement.

“In anticipation of a positive outcome, and to minimise any delay, Alto has lodged a Mining Lease application over the Indomitable Camp deposits with the Department of Mines, Industry Regulation and Safety (DMIRS).

“Over the September Quarter of 2018, Alto expects to undertake drilling to collect samples for metallurgical testwork and other studies and will investigate processing options.

“The testwork and studies will occur in parallel with continued drill testing and exploration of a number of advanced gold-in-soil and litho-structural targets.”

 

Email: admin@altometals.com.au

Website: www.altometals.com.au

Alto Metals Re-invigorating Sandstone Gold Potential

THE INSIDE STORY: Alto Metals is aiming to re-establish standalone oxide and primary gold mining and milling operations at the company’s Sandstone gold project in Western Australia.

Alto Metals holds 800 square kilometres of the prospective Archaean Sandstone Goldfield in the East Murchison Mineral Field of WA.

Alto acquired the project in June 2016 and has compiled and reviewed a large legacy database leading to a series of focused exploration and drilling campaigns.

“We acquired the project in June 2016 andthe tenements were granted in September that year,” Alto Metals managing director Dermot Ryan explained to The Resources Roadhouse.

“During that 18 months we completed a detailed airborne magnetic survey, compiled a data base and made some new discoveries.

“Most of the Sandstone belt is covered by a layer of soil and sand and laterite, so airborne magnetics are needed to look to the basement rocks underneath to find favourable lithologies and structures for gold mineralisation.

“We did that, then burrowed through the Western Australia Mines Department historical soil sample and historical drilling results.

“We integrated those data sets and identified 56 targets we divided into camp-style areas, ranking them in order of potential prospectivity.”

Armed with this information, Alto aims to delineate a combined one million-ounce JORC 2012-compliant Mineral Resource, to be the basis for recommencing operations.

Work date has demonstrated this resource is likely to comprise relatively shallow gold deposits from brand new discoveries – new discoveries near known small deposits in the vicinity of Vanguard and Indomitable and expanding existing deposits such as Lord Nelson and Lord Henry.

“Oxidisation in the Sandstone region is around 50 metres deep, so drilling an angled hole to average of 41 metres depth, like many previous explorers at Sandstone, doesn’t test the primary zone,” Ryan explained.

“At targets such as Vanguard and Indomitable, we are drilling deeper, inexpensive aircore holes to get a good look in that primary zone with the view of developing these targets into open pit Resources we can mine from surface.

“For a junior company, discovering and mining a new deposit that is oxide on top and primary zone within 100 metres of surface is a better first option than drilling 200 to 300 metre holes under somebody else’s old pit.

“This deeper drilling can be funded later, or done now by others, if they have the requirement and the necessary funds.”

From a one-million-ounce start, Alto’s hopes to define over five million ounces of gold, which it considers comparable to other more intensely explored greenstone belts in the Yilgarn area.

Early results from RC and AC drilling conducted at the Vanguard and Indomitable targets demonstrated the Vanguard system contains many high-grade mineralised structures.

Alto’s drilling at Vanguard discovered four new high-grade mineralised structures, in addition to the previously known structure, providing further evidence the Vanguard system is robust and open.

Assay highlights from Alto’s RC drilling of the oxide zone at Vanguard included:

SRC046
8 metres at 7.8 grams per tonne from 34m;

SRC064
29m at 2.3g/t gold from 28m; and

SRC067
33m at 2.3g/t gold from 39m.

RC drill results from the primary zone at Vanguard included:

SRC075
22m at 4.2g/t gold from 88m, including 3m at 13.3g/t from 28m;

SRC016
17m at 4.5g/t gold from 122m, including 2m at 12.2g/t gold from 133m;

SRC032
22m at 3.3g/t gold from 103m, including 1m at 15g/t gold from 109m; and

SRC048
7m at 7g/t gold from 126m, including 2m at 10.8g/t gold from 128m.

“Between May and June 2018 we drilled over 12,000 metres of aircore over ten high priority prospect areas at Sandstone,” Ryan said.

“Approximately half of these holes, and half of the metres, were drilled around Vanguard and between Vanguard and Vanguard North.”

All five mineralised structures at Vanguard plunge shallowly to the northeast and remain open at depth.

The oxidation base was encountered at approximately 50m depth with mafic volcanics being the primary host rock.

A soil sampling program early this year identified a two square kilometre gold in soil anomaly connecting Vanguard and Vanguard North.

Assays of 197 of almost 400 samples from the Hancocks Mining Centre south of the Bull Oak pits defined a coherent 30 parts per billion (ppb) gold-in-soil anomaly over 9sqkm.

Assays from 28 samples out of a total of 340 samples collected near the Edale Fault returned anomalous results of over 7ppb gold in two discrete linear zones, each between 1,000m to1,500m long.

A third target, Chance, also lies on a splay of the Edale Fault.

“Our sampling program appears extensive, but we’re not blanket covering the whole belt,” Ryan said.

“We have focused on target areas of historic work that is incomplete.

“Once there, we are conducting detailed soil sampling to see if we can expand or constrain those targets for follow-up drilling.

“Although we have already completed 12,000 metres of aircore drilling this year, we have another 8,000 metres scheduled.”

More recent soil sampling over a geophysical target approximately 12km south of Sandstone has defined a plus 7ppb gold anomaly striking southeast over 1,500m.

In keeping with the history of naming prospects at Sandstone after WW1 British battleships, the target was dubbed ‘the Superb Anomaly’, possibly due to it returning a maximum value of 228ppb gold, with a further 13 samples returning over 15ppb gold.

The area hosting the Superb Anomaly was initially identified by Barry Bourne, a consultant of Terra Resources, in 2017 after processing and interpreting the detailed aeromagnetic data mentioned above that had been flown and/or compiled by Alto over the entire Sandstone project area.

Bourne described the target as, “a break in sediment/mafic stratigraphy with proximal mineralisation”.

“The Superb Anomaly lies in an area of iron rich duricrust, or laterite, so we need to determine whether the gold is representative of a primary gold source at depth, or is alluvial in nature,” Ryan explained.

“Further soil sampling will determine the extent of this gold in soil anomaly which is open to the south east.

“We have lodged a Program of Work for Aircore drilling with the Department of Mines, Industry and Safety and are awaiting approvals to enable us to start drilling.”

At the same time as the search proceeds for the new one million ounce discovery, Alto is reviewing potential for generating early cashflow from treating 100 year old battery sands from Hacks, Oroya, Havilah and Maninga Marley prospects.

Auger sampling and metallurgical test work is underway to determine the material’s viability for being incorporated into a low-cost heap leaching operation.

“There is still a lot of gold – underground – at Oroya, and we’re currently digitising the old level plans and having a look at what might be a residual Resource that we could do something with – or somebody else might want to do something with,” Ryan said.

“Hacks is another deposit mined by the old timers to the south of Sandstone that historically produced around 206,000 ounces of gold at 28 grams per tonne gold.

“In the short term we are reviewing all the existing open pits and looking at what potential may lie beneath them.

“The deposits we are looking at all have very high-grade in the primary zone.”

 

Alto Metals Ltd (ASX: AME)
…The Short Story

HEAD OFFICE
Suite 9
12 – 14 Thelma Street
West Perth, WA, 6005

Ph: +61 8 9381 2808

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

DIRECTORS
Terry Streeter, Dermot Ryan, Dr Jingbin Wang, Terry Wheeler

 

Alto Metals Widens Hancock Anomaly

THE DRILL SERGEANT: Alto Metals (ASX: AME) has widened a gold-in-soil anomaly at the Hancocks prospect, part of the company’s Sandstone gold project in the East Murchison Mineral Field of Western Australia.

Alto Metals has received assay results for an additional 271 soil samples from the Hancocks prospect, taking the total to 478 samples collected in April 2018, which have defined a highly anomalous and coherent +15 parts per billion (ppb) gold-in-soil anomaly over eight square kilometres.

The company indicated that 93 of these samples (19% of total collected) assayed greater than 30ppb.

“Results from the first of three batches of soil samples collected at Hancocks, south of the Bull Oak open pits were reported on 13 June 2018,” Alto Metals explained it its ASX announcement.

“The results from the remaining two batches have now been received and integrated with the first batch to show the totality of the Hancocks eight square kilometre gold-in-soil anomaly.

“The regolith in this area is shallow, and there are numerous shafts and pits present (developed in the period 1894-1920) where the dumps surrounding the shafts contain fresh differentiated dolerite, banded iron formation (Bif), sediments and quartz.”

 

Email: admin@altometals.com.au

Website: www.altometals.com.au

 

Alto Metals Identifies New ‘Valiant’ Gold Anomaly

THE DRILL SERGEANT: Alto Metals (ASX: AME) received assay results for 336 soil samples collected near four litho-structural targets close to the town of Sandstone in Western Australia.

Alto Metals claims the assays have defined a coherent 15 parts per billion (ppb) gold-in-soil anomaly over 2.5 square kilometres.

The Valiant anomaly lies approximately seven kilometres south-south east of the town of Sandstone in an area that was initially identified as a prime site for gold mineralization by Terra Resources consultant Barry Bourne in 2017.

Four litho-structural targets, No’s. TR09 -TR11 and TR13 were identified when Bourne processed and interpreted the detailed aeromagnetic data flown and/or compiled by Alto over the entire Sandstone project area.

According to Alto, Bourne described the target as, “a break in sediment/mafic stratigraphy with interpreted felsic intrusives”.

“The systematic approach being applied at Sandstone, that is, detailed magnetic surveys to ‘look through’ lateritic cover, interpretation to identify favourable fractured iron rich host rocks, and follow up soil sampling, is potentially outlining new large gold systems,” Alto Metals managing director Dermot Ryan said in the company’s announcement to the Australian Securities Exchange.

“Drill testing of this latest soil anomaly is awaiting approval from the Department of Mines, Industry Regulation and Safety.”

 

Email: admin@altometals.com.au

Website: www.altometals.com.au

 

Alto Metals Claims New Vanguard Gold Mineralisation

THE DRILL SERGEANT: Alto Metals (ASX: AME) claimed discovery of gold mineralised systems at the Vanguard deposit on the company’s Sandstone gold project in Western Australia.

Alto Metals received 50 gram metre fire assays of four metre composite aircore samples taken from 35 AC holes drilled on the periphery of the Vanguard deposit.

According to the company, ten of these ‘extension holes’ intersected shallow intersections of plus-0.5 grams per tonne gold.

Assay highlights include:

SAC206
20 metres at 1.4 grams per tonne gold from 40m; and

SAC214
12m at 2.5g/t gold from 0m and 9m at 4.0g/t gold from 60m.

Alto interpreted these new gold results as further evidence the Vanguard system is robust and open and justifies the current aircore drill program to test and expand the footprint of the Vanguard gold deposit.

“Between 26 May and 25 June 2018, Alto completed 253 infill and/or extensional aircore drill holes for a total of 12,175 metres over ten high priority prospect areas at Sandstone,” Alto Metals managing director Dermot Ryan said in the company’s announcement to the Australian Securities Exchange.

“Approximately half of these holes and half of the metres were drilled around Vanguard and between Vanguard and Vanguard North.

“This first batch of four-metre composite assays now received from 35 holes around Vanguard are highly encouraging, and they add two more mineralised structures to the three mineralised structures previously defined by Alto.

“We are looking forward to the assay results of the outstanding 118 Vanguard AC holes over the next four to five weeks, which will potentially define further mineralized structures.”

 

Email: admin@altometals.com.au

Website: www.altometals.com.au

 

Alto Metals Defines ‘Superb’ Anomaly at Sandstone

THE DRILL SERGEANT: Alto Metals (ASX: AME) announced that soil sampling has located a strong linear gold-in-soil anomaly approximately 12 kilometres south of the Sandstone township in Western Australia.

Alto Metals said assays from 24 samples out of a total of 74 samples collected in the vicinity of a geophysical target approximately 12km south of Sandstone have defined a 1,500 metres-long, south-east striking gold in soil anomaly of plus-7ppb gold.

The maximum value was 228ppb gold, and 13 samples returned over 15ppb gold.

Alto said the assayed gold in soil anomaly, now known as the Superb Anomaly, lies in an area of iron rich duricrust (or laterite).

“It is not known at this stage whether the gold in the soil is representative of a primary gold source at depth or is alluvial in nature (ie. transported),” Alto Metals said in its ASX announcement.

“Further soil sampling is required to determine the extent of the gold in soil anomaly which is open to the south east.”

The company has lodged a Program of Work (PoW) for Aircore drilling with the Department of Mines, Industry and Safety but approval is yet to be granted.

 

Email: admin@altometals.com.au

Website: www.altometals.com.au

 

Alto Metals Defines Sandstone In-Soil Gold Anomalies

THE DRILL SERGEANT: Alto Metals (ASX: AME) completed soil sampling it claims to have located three linear gold-in-soil anomalies along an interpreted ‘splay’ off the Edale Fault near Sandstone in Western Australia.

Alto Metals described the Edale Fault as a major deep crustal feature forming the eastern boundary of the Sandstone Greenstone belt, and a potential conduit for emplacement of gold-rich fluids.

The company has received assays from 28 samples out of a total of 340 samples collected in the vicinity of the Edale Fault that have returned anomalous results plus-7ppb gold in three discrete linear zones, each between 1,000 metres to 1,500m long.

“Throughout the Yilgarn Craton, the bounding faults to the Archaean greenstone belts and their environs play host to major orogenic gold deposits,” Alto Metals managing director Dermot Ryan said in the company’s announcement to the Australian Securities Exchange.

“We are very encouraged by these coherent, linear gold in soil anomalies, which we intend to drill test as soon as our Program of Work is approved by the Department of Mines, Industry Regulation and Safety.”

 

Email: admin@altometals.com.au

Website: www.altometals.com.au