Recent announcements regarding the South Australian mineral and energy resources sectors
This update covers the September 2018 period and is compiled from information publicly released by companies.
Readers should refer to the latest information available on company websites, particularly in regard to making any forward investment decisions.
Previous news items:
- Alliance Resources
- Andromeda Metals – Evolution Mining
- Archer Exploration
- Argonaut Resources – Aeris Resources
- Havilah Resources
- Leigh Creek Energy
- OZ Minerals – Red Metal
- Renascor Resources
- Strike Energy
- Tyranna Resources
- Woomera Mining
- WPG Resources
Alliance Resources released a maiden mineral resource estimate for the Weednanna gold deposit of 1.097 Mt at 5.1 grams per tonne (g/t) gold for 181,000 ounces of gold (ASX release 6 September 2018). Part of the Wilcherry project joint venture between Alliance (75.01%) and Tyranna Resources (24.99%), this milestone confirms Weednanna as a quality gold deposit with outstanding economic potential.
There is potential to increase the estimate with further drilling as all gold shoots are either open at depth or down plunge. For the mineral resource less than 0.5 g/t Au, approximately 45% has been classified as indicated (corresponding with areas of higher drilling density) and 55% as inferred (areas of lower drilling density).
Drilling has recommenced at Weednanna (ASX release 7 September 2018). A total of 4,200 m is planned including 23 reverse circulation holes to extend gold mineralisation at shoots 1, 4, 5 and 5E, and 4 holes to test for gold mineralisation associated with a major quartz vein in the immediate hangingwall at shoot 1. The vein previously returned 48 m at 2.0 g/t Au from 54 m, including 7 m at 5.4 g/t Au from 69 m and 2 m at 16.0 g/t Au from 98 m (ASX release 16 July 2018). Several drilling programs are proposed to increase the size of the Weednanna mineral resource.
Andromeda Metals – Evolution Mining
Andromeda Metals has executed a binding earn-in and exploration joint venture covering its wholly owned Drummond epithermal gold project in Queensland (ASX release 3 September 2018).
Archer Exploration has entered into a legally binding material transfer agreement with a leading German biotechnology company in relation to Archer’s graphene-based biosensor development activities with the University of Adelaide Graphene Enabled Industry Transformation Hub (ASX release 27 September 2018). The Hub is co-funded by the Australian Research Council.
Argonaut Resources – Aeris Resources
Stage 1 of Argonaut Resources’ deep drilling program at the Torrens joint venture project will start soon and include 8–10 drillholes to depths of 700–1,500 m on primary targets (ASX release 17 September 2018). A total of 20–30 drillholes are planned over two years.
A three-hole metallurgical drilling program has been completed at Havilah Resources’ Kalkaroo copper–gold–cobalt deposit as part of ongoing prefeasibility studies (ASX release 11 September 2018). The holes were located to be representative of the overall Kalkaroo deposit and, in particular, of the four main styles of mineralisation. Results include:
- 85 m at 2.73 g/t Au from 75–160 m; 73 m at 1.17% Cu from 87–160 m; 39 m at 261 ppm Co from 121–160 m (in sulfide zone only) (KKDD486)
- 68.3 m at 1.29% Cu and 148 ppm Co from 121–189.3 m; 60.3 m at 0.48 g/t Au from 129–189.3 m (KKDD488)
- 16 m at 1.16% Cu and 0.59 g/t Au from 114–130 m (KKDD487).
Encouraged by the latent value of copper, cobalt and gold in the pyrite concentrate, which potentially can be recovered for very little additional expense, Havilah intends to obtain larger samples of pyrite concentrate from bulk sulfide ore samples to demonstrate this. The metallurgical work has the potential to add significant value to Kalkaroo over and above the already favourable economics.
Leigh Creek Energy
First syngas production is imminent for Leigh Creek Energy’s Leigh Creek Energy project following final activity notification approval by the government (ASX release 3 September 2018). With on-site construction and drilling activities complete and the final approval in place, the precommercial demonstration stage and production of syngas is expected to begin in the third quarter of 2018.
Reconnaissance drilling at Marmota’s CAR prospect has identified widespread gold mineralisation in altered granite over an area 1 km across and open in all directions (ASX release 13 September 2018). Twenty of the 23 holes drilled returned anomalous gold mineralisation, with 4 m intervals between 50 and 285 parts per billion gold. Many of the gold intercepts are associated with anomalous silver and arsenic. The prospect is approximately 70 km southeast of Challenger gold mine.
A 26-hole extensional drilling program commenced at Marmota’s Goshawk deposit, part of the Aurora Tank gold project, targeting depths of 50–180 m (ASX release 17 September 2018).
Phase 2 metallurgical test results at Aurora Tank have been released (ASX release 20 August 2018). Work focused on gold particle size distribution and efficiency of gravity concentration, and the effects on gold recovery of variable grind sizes on continuous and intermittent bottle rolls. Results showed:
- Overall gold recoveries of 95.9% (supergene samples) and 92.7% (transitional samples) from combined gravity recoverable gold and cyanide leaching tests.
- Gold particles are generally fine grained, in the 5 to 50 micron size range.
- Recoveries of 89–92% from variable grind size continuous agitation test with leaching predominantly complete in 6 hours indicating fast leach kinetics.
- Recoveries of 89.2% and 81.5% from intermittent bottle roll tests using coarse crushed samples of 12.5 mm and 25 mm sizes, respectively. Recoveries were predominantly complete within 24 hours indicating that low-cost, low capital expenditure heap leaching may be a viable option for the Goshawk deposit.
The latest round of drilling at Aurora Tank is underway (ASX release 24 September 2018) and will be completed by end September. A total of 26 holes are proposed targeting extensions by both stepping out and down plunge to depths of 50–180 m.
OZ Minerals – Red Metal
A maiden drilling program to test a series of new copper–gold plays has commenced at the Punt Hill and Pernatty Lagoon project, an OZ Minerals – Red Metal joint venture (Red Metal ASX release 10 September 2018). The 6,000 m plus proof-of-concept program will target six previously untested geophysical targets that include PH1, which shares a similar geophysical response to that measured and modelled over the Carrapateena and Khamsin copper–gold deposits. The program is expected to be completed over the next three months.
An infill drill program is underway at Renascor Resources’ Siviour graphite project comprising up to 5,000 m of aircore, reverse circulation and diamond drilling (ASX release 10 September 2018). The program will focus on close-spaced drilling within the Siviour indicated resource and is expected to take 6–8 weeks. It will also include resource expansion drilling aimed at expanding near-surface, high-grade zones that are expected to be included within the mining schedule for the project’s first 5 years, as well as the collection of further representative samples for ongoing metallurgical test work.
Work will continue on additional Siviour definitive feasibility study work programs including optimisation mineral process testing, detailed engineering and procurement, regulatory approvals, and offtake and marketing negotiations. A prefeasibility study for the downstream production of uncoated spherical graphite using Siviour graphite concentrates is also included.
The bulk dewatering phase has been completed at Strike Energy’s Jaws 1 appraisal well with instantaneous peak rates of 1,400–1,500 barrels of water (ASX release 24 September 2018). Bottomhole pressure has been reduced by 65% and operations have moved into a controlled drawdown phase as the well approaches its desorption window. Strike will continue the current phase until the wellbore is at the cusp of critical desorption pressure.
Tyranna Resources, as manager of the Western Gawler Craton joint venture, has commenced a revised reverse circulation drilling program at the Campfire Bore prospect as part of the Jumbuck gold project (ASX release 20 September 2018). The program will focus on completing infill drilling to upgrade the Joint Ore Reserves Committee (JORC) status of Campfire Bore from the inferred to indicated category. It will not include the maiden drilling program at the South Hilga prospect – announced in an ASX release on 20 July 2018 prior to joint venture partner WPG Resources appointing administrators Ernst and Young on 8 August 2018.
Two exploration licences (ELs) have recently been granted to Woomera Mining – EL 6180 that forms part of a four-licence tenement package in the Musgrave Province under a joint venture arrangement with OZ Minerals, and EL 6246, Woomera’s Nawa project (ASX release 26 September 2018).
A ground moving loop electromagnetic survey is almost complete in the Musgrave Province. Over 100 line km (i.e. 500 stations) has been acquired with only 12 line km remaining. An infill drilling program is expected to follow in late October.
A 3D magnetic and gravity inversion model has been completed for the Nawa project using data published by the Geological Survey of South Australia. Native title discussions have also been initiated with the Antakirinja Matu-Yankunytjatjara Aboriginal Corporation.
On 26 September 2018 the receivers of WPG Resources advised that operations at the Tarcoola gold mine had ceased and that the Challenger gold mine would be placed in care and maintenance on 8 October 2018.