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Why junior Nexus Mineral’s Kalgoorlie gold discovery has geologists all hot and bothered

Nexus Minerals (ASX:NXM) could well be categorised as a late bloomer. Once an iron ore explorer with interests in Australia … Read More
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This article was originally published by Stockhead

Nexus Minerals (ASX:NXM) could well be categorised as a late bloomer.

Once an iron ore explorer with interests in Australia and Tanzania, the company underwent a radical shift in the mining bust.

Entering at the bottom of the market in 2014, geologist and new MD Andy Tudor – whose resume includes roles in the discovery and drill out of major gold orebodies like King of the Hills, Bannockburn and Wafi-Golpu – shifted the company’s focus to gold.

Since then it has been a hard slog. It shifted direction in 2015 by farming into the Pinnacles project, tenements unloved by Saracen Mineral Holdings around its Carosue Dam gold mine near Kalgoorlie.

Nexus took its leap into WA’s Goldfields one step further in 2018 by picking up the Wallbrook gold project from Saracen and additional tenements around it from gold giant Newmont.

It is seven years now since Nexus announced its shift in strategy and it is starting to pay off.

The key driver has been the success of drilling at the Templar and Crusader prospects at Wallbrook which, according to Tudor, closely resemble the multi-million ounce Karari underground mine which is the mainstay of the Carosue Dam operation, now run by ASX-listed gold giant Northern Star (ASX:NST).

After announcing the discovery of high-grade gold mineralisation at Templar in October last year, continued wide, high grade intersections since August have sparked a major run that has seen Nexus’ shares charge from long term levels of around 9c to 50c yesterday, a 455% rise in the past six months.

Nexus is now in a trading halt for a capital raising – reported to be up to $19 million – to restock for a drilling assault on Templar and Crusader.

Stockhead

sat down with Andy Tudor this week to find out where it has gone so right for the gold explorer in 2021.

 

Nexus has one of the strangest 10 year charts I think I’ve ever seen. You were between five and 10 cents for about six or seven years, a little spike when the gold price had its first run in 2016 and then back to five or 10 cents. And then this year, it’s just absolutely gone stratospheric. It’s a pretty strange story isn’t it?

“It’s one of those I guess a lot of junior explorers explore for many years, and don’t ever get that bump and you know, if you don’t have a discovery, it’s just not going to happen.

“We’ve been actively exploring right the way through there and certainly this Wallbrook project … when it first started moving was very much on the back of geologists ringing me post the release and putting out photographs going ‘holy crap, that looks like underground at Karari.’

“That is incredible. And these are guys who worked there over the years, my peers and people around my age, who are all going ‘holy crap’. So then they’ve all jumped on, and started to buy stock.

“Going ‘this just looks incredible, I can’t believe that it looks so much like what Karari does’.

“Unfortunately, we’ve got a lot of drilling to do before we get to be able to announce a resource and see what it looks like.

“At the moment, everywhere we’re hitting, we’re getting the right rocks, we’re getting great grade. We’re getting everything we want. But yeah, it’s a long year ahead.”

drillcore at a coreyard near Kalgoorlie
Tudor, right, with geos at the Wallbrook project’s coreyard. Pic: Nexus

 

Nexus Minerals share price today:

 

 

So how have you approached exploration from when you acquired Pinnacles and you came into the business around 2013?

“We had virtually no tenure when I came in. So I came in 2013, the company had $6 million in the bank and an old iron ore project, an old copper project in Tanzania, old copper project on the Northern Territory-WA border.

“But literally it was like we want to get out of all of those, what do we do as a company. That’s what I spent the first six months doing, looking about where I wanted to be.

“And this Wallbrook is an area where I’d sort of identified as being in a perfect world that’s what I want. And so even seven years later, eight years later, and I’ve actually got it and it’s coming up with the goods.

“There’s not many stories like that and I think the great thing about Wallbrook as well is that there’s no old pits.

“All we were drilling, it’s all virgin ground. So you’re starting from scratch, there’s nothing to go by and we’re drilling ballsy holes, a really a long way away from what we know, to sort of go well it’s gotta be big.

“So let’s drill it like we think it’s big, rather than drilling it like we think it’s small because that’s not the case.”

 

I’m seeing a lot of people say this, like, we’re not going out exploring just so that we could get a 200,000oz deposit and make a quick buck off it. The aim is to find something that’s, you know, 2,3, 4 million ounces plus – is that what you’re aiming for?

“Absolutely. I think whilst we all want that, we all say that.

“It’s very hard as you know, I mean, how many of those discoveries have been made in WA in the last 10 years? A couple at best.

“So it’s hard to do and everyone’s trying, it is just bloody hard to find, it is that ultimate needle in a haystack.

“So you can do all the technical backgrounds you can to get to this point, but then gold is where it is, we’ve then got to start drilling.

“We’ve been fortunate today, wherever we’ve been drilling, we’re hitting it where we want to hit it, it’s looking fantastic everywhere. And it just keeps growing.

“Everywhere we’ve drilled, it’s just completely open. It’s good widths, good grades, good alteration halos and no surprises. It’s even surprised me as a geo doing this a long time that we’ve got 1.6km, almost gunbarrel straight that no matter where we’re drilling, we can drill it and go yep, we expect to hit it at 100m, we hit it at 100m.

“Expected it at 300m, we hit it, the diamond hole we’ve just done, diamond hole 5, the geos said we expect to hit it at 500m. That’s a long way down, we’ve got nothing to go on hundreds of metres around it, we hit it at 506m.

“It’s astoundingly linear. And normally, when you get this linear style of deposit, the grade tends to be to diffuse, so it’s actually disseminated, but to the point where the grade drops, whereas this hasn’t.

“So this you’ve actually got it gun barrel straight, we’re hitting it where we expect to hit it, and it’s holding the grade and improving with depth.

“It’s not many like that people are exploring for at the moment, and hence the interest is that people are starting to get the story and go ‘shit, that’s real up there’.”

Visible gold in drill core
Visible gold from the Wallbrook project. Pic: Nexus Minerals

 

How long do you think you’re going to be drilling there before you’re able to announce a resource for the Crusader and Templar projects?

“It’ll be all of next year. We’re doing 30,000 metres right now, which we started six or seven days ago.

“So we’ve got a quarter to complete that, let’s get that out of the road. So we expect to get all of those results by the end of Q1 next year.

“And that will then lead us into our resource program. So this one is what I’d call a tagging program where we need to know where it is.

“We can roughly join the dots, we can work out, do we need to be 20 by 20m? Do we need to be 10 by 5m? What does the drill spacing need to be to give us this indicated resource?

“So then in Q1, we’ll have a pretty good guide, get to the end of Q3 drilling right through the year. And then we’ll start to be able to sort of put some lines around it and really (see) this indicated resource,

“Ultimately to move to engineering studies you really need indicated, there’s little point doing those with an inferred resource. So we’d probably rather drill for another quarter and get the results and the answers we need, then go into full blown studies towards the end of next year, once we start getting a bit of feeling for what it looks like.”

 

Does the success you’re having out there from the exploration perspective, does it put you in the crosshairs of Northern Star, St Barbara, Anglogold, the big companies around there?

“Look I’d be naive to say it doesn’t. Yes, it does. But I think at the moment, we will see. We’re good explorers, that’s what we do and at the moment I think the larger companies who are not explorers, would be quite happy to say, well, you stick to what you do best for this next 12 months or beyond.

“And we’re certainly planning on running our own race, but we can’t be naive to sort of think that people aren’t watching in a general environment where new ounces are hard to come by and there aren’t many of them.

“We’re in a district where we’ve got a hungry mill already, being Northern Star’s Carosue Dam operation.

“Apollo and the Ramelius potential takeover there … 30km to the south of that, means that you’ve potentially got other big players coming into the district, and they’re going to want to tie up the ounces that are known about for their mills ultimately.

“So yes, we are certainly going to be in that. And I suppose I can only hope that we’re given the opportunity to sort of find out what this really looks like. And then it’s interesting to have those conversations, because you’ve got something that’s pretty significant to come to the table with.”

 

You spoke about the current predictability of the resource that you’re finding, or the mineralisation that you’re finding, the linearity of it and the comparison between it and Karari. Why is it that no one’s found this before? We know Saracen had this ground that you’re working on.

“It’s history, this big tenement package was owned by Sons of Gwalia back in the 90s. Then they went broke.

“So then it sat in administrators’ hands, Saracen took it out of administration but then they had their hands full with Carosue Dam and getting that up and running, making it a profitable operation, which they’ve obviously done very well.

“But they were spending no money on exploration. And then we sort of came along and said, well, you know, they’ve become shareholders of us in exchange for this tenure, which is, as I said is the one I’ve always wanted, and then we’ve been attacking it now for say the last two years properly.

“You also need that project champion. You come back to the timing, I always believed in it, I’ve driven and driven and driven, we’ve done all the grunt work, it starts to look good.

“It’s not really ‘til now that we’re really able to say, ‘this looks pretty good’.

“Otherwise, you might have drilled shallower holes and walked away. So I think most of these projects that ultimately have a discovery story, will have this project champion.

“Hopefully I can put my name to this one, go ‘it was me who selected the ground, committed to it, believed in it’. And now the results are coming. And we’ll see what that looks like in 12 months’ time.”

 

You were talking about drilling deeper. Is there a lot of cover where you are or is it just the idea that you looked at the geology and said we need to drill deeper to find the thing? What made you drill deep initially?

“When we were looking at that Karari project to the south, the evolution of that discovery is quite interesting.

“They drilled broad space drilling over the top of these Karari and Whirling Dervish mines in the mid 90s and early 90s and they got one drill hit a couple of metres at 0.6g/t down to 40m.

“So they drilled a deeper RC hole and got sort of 10m at 2g/t, then they brought in a diamond hole. And again, somebody at that time had that commitment, at a pretty low grade, pretty broad spaced, had a crack, put a deeper hole in it.

“We’ve got a lot of the historical data because with Saracen as the JV partners as well in other project parts, they allowed us to have a look at it. And what you see is, as more and more drilling gets put in and the deeper it goes, it develops up nicely.

“Some (deposits) don’t, some get daggy, some get worse, the more you drill, the worse it gets.

“Whereas this was the opposite. And so when we then started looking up here and we were unashamedly looking for another Karari, we knew that around the 100m mark had to be the drill depth, or else we just weren’t going to see it.

“Drill hole 97, which I think will ultimately be what we’ll call our discovery hole, we spent a lot of time with our junior geos looking at all the drill chips in the area and what the alteration product looks like.

“What are we looking for when we drill, they were out there on hole 97 which was meant to be 100m deep.

“It got to 96m, we changed the rods, the rocks were just starting to change colour just a little bit like we were looking for.

“So I said we’ll push a couple more rods down. And really, the rest is history. They drilled to 126m, the rocks were bogged because of the clays and the water, which is a good sign in a way, we end up with 20 metres at 1.7g/t including 4m at 6g/t.

“And now we’re drilling underneath that and we’re getting these great results of depth. So that evolution will ultimately be the story of the discovery.

“Now we know that we were lucky that we got that hole with those last few metres or we potentially would have been right over the top of it and missed it.

“So we’ve actually sat down post each of these drill programs and when we now go regionally exploring, 250m will be the shallowest hole we will drill.

“You’ve got to be well funded to do that, and we are, but there’s little point drilling 100m if you’re potentially sitting on top of multi-million ounces, and you’re gonna spend all that money but you’re not quite going to go deep enough.”

Headshot of Nexus boss Andy Tudor
Nexus boss Andy Tudor. Pic: Nexus Minerals

 

It’s interesting how much of exploration and discovery success is conviction and luck. If you’d stopped the hole when the rods needed to be changed at 96m, then you never would have found that.

“There will be any number of stories, components in it, that will be luck. There has to be.

“(But) you make your own luck. And you know, we thought that by spending months training up our junior geos and going through all the old drill chips and going ‘look you relog everything so you’ve got your eye in when you start this drill program, you know what you’re looking for’.

“You see something that’s interesting you keep going, you know that’s ultimately exploration.

“I’m still passionate today as what I was at day dot. Some people say it’s a mix of art and science.

“You’ve got to be pretty sort of a romantic and be very much a glass half-full kind of person because it’s not for the faint-hearted.”

The post Why junior Nexus Mineral’s Kalgoorlie gold discovery has geologists all hot and bothered appeared first on Stockhead.






Author: Josh Chiat

Articles

Resources Top 5: Hopeful uranium stocks, an important graphite deal, and lots of imminent news flow

Aspiring graphite miner Black Rock invited to finalise agreement with Tanzanian government Cauldron Energy dusts off Yanrey uranium project, despite ……

  • Aspiring graphite miner Black Rock invited to finalise agreement with Tanzanian government
  • Cauldron Energy dusts off Yanrey uranium project, despite government opposition
  • Redstone (copper, cobalt), Latrobe (magnesium) and Empire (gold, copper, nickel, PGEs) up on no news

Here are the biggest small cap resources winners in early trade, Tuesday December 7.

 

CAULDRON ENERGY (ASX:CXU)

(Up on no news)

When the WA state government implemented a ban on most new uranium mines in 2017, CXU stopped work at its flagship ‘Yanrey’ uranium project and began searching for other dirt to play with.

It now has a historic gold project called ‘Blackwood’ in Victoria and a silica sands play called ‘Ashburton’ in WA. It is also poking around Yanrey again, which is a lot more interesting now that uranium prices are on the move.

While government support (or lack thereof) for new mines has not changed, a recent survey uncovered a bunch of “highly prospective targets for follow-up drilling” at Yanrey.

“Our ultimate objective is to explore for uranium mineralisation amenable to extraction by ISR,” CXU exec chairman Simon Youds says.

“Economic deposits of sandstone-hosted, palaeochannel-style uranium can be mined using ISR in the lowest cost quartile of uranium mined globally.”

“This characteristic makes these deposits extremely attractive for mining at any uranium price and necessarily must form the basis of any uranium resource portfolio.”

Yanrey exists within a larger uranium province that is slowly being uncovered, Youds says.

“There is potential here for a scale comparable to the best uranium-endowed province globally and that, with astute leadership, Western Australia is at the threshold of a new energy resources boom.”

At Blackwood, CXU has stumbled upon visible gold in an underground area historically excavated for access purposes only:

“The visible gold observed, coupled with the beautiful sandstone-shale contact and structurally complex geology, provides an exciting new target for drill testing,” Youds said in November.

“The observation of visible gold further increases our confidence in the remaining mineral potential of these historical mines.”

The $11.5m market cap stock is down 6% over the past month, and 30% year-to-date. It had $1.5m in the bank at the end of September.


 

REDSTONE RESOURCES (ASX:RDS)

(Up on no news)

The nanocap, which has partially bounced back from recent losses in early trade Tuesday, is drilling to grow the 38,000t copper, 535t cobalt ‘Tollu Copper Vein’ deposit, part of the ‘West Musgrave’ project in WA.

Tollu hosts “a giant swarm of hydrothermal copper rich veins” in a mineralised system covering a +5sqkm area, ~40km from OZ Minerals’ (ASX:OZL) world-class Nebo-Babel nickel-copper deposit.

A conceptual (theoretical, not real yet) exploration target suggests up to 627,000t of copper may be present, the company says.

Recent portable XRF analysis of new drilling returned hits like 16m at 2.62% copper from a 74m downhole, including 6m at 6% copper from 76m.

These will be confirmed by traditional assay, the company says. Labs are backed up to the hilt, so who knows when that will be.

RDS say exploration will continue “at the earliest opportunity” in 2022 with a deeper RC drilling program at priority targets.

The $12m market cap stock is up 30% over the past month. It had $2.6m in the bank at the end of the September quarter.

 

BLACK ROCK MINING (ASX:BKT)

It’s been a good news week for aspiring graphite miner BKT.

Today it announced it had been invited by the Mining Commission to attend a ceremony in Dar es Salaam, Tanzania on Monday 13 December “to finalise an agreement with the Government of Tanzania”.

Black Rock managing director John de Vries is currently in country and is expected to attend, BKT says.

The company has also just completed a massive 500t pilot plant run – the largest ever, it says — to send off for qualification (testing) to potential customers in North America, Asia and Europe.

This will ultimately support project financing, BKT says.

The company now needs to finalise off-take terms with cornerstone investor POSCO, and secure finance to underpin a $US116m Phase 1 development capex program.

The $183m market cap stock is down 10% over the past month, and up 115% year-to-date. It had $9.3m in the bank at the end of September.

 

LATROBE MAGNESIUM (ASX:LMG)

(Up on no news)

Early works – like fixing fences, site clean-up, contracting — are happening apace at LMG’s magnesium project in Victoria’s Latrobe Valley, with construction on an initial 1,000 tonne per annum magnesium plant due to kick off in Q1 2022.

Production starts up to 12 months later in Q4 2022.

The plant will be expanded to 10,000 tonnes per annum magnesium shortly thereafter, with further plant capacity expansion to be considered once it is operating successfully.

Magnesium has the best strength-to-weight ratio of all common structural metals and is increasingly used in the manufacture of car parts, laptop computers, mobile phones, and power tools.

In November, LMG said current magnesium price was US$6,150 per metric tonne and expected to hold.

“LMG’s revenue estimates are based upon US$3,250 per tonne which was the magnesium price in June 2021, before the China supply shortage commenced in September 2021,” it says.

“If the current price of US$6,150 per metric tonne held long term, it would increase LMG’s estimate of EBITDA for its 10,000tpa plant by some $56m.”

In 2020, world magnesium production was ~1 million tonnes, of which China supplied ~85%.  China has begun a 13-year plan to increase Mg in cars from 8.6kg to 45kg by 2030, requiring an additional 1 million tonnes of new Mg production per annum.

$131m market cap LMG is down 21% over the past month, and up 335% year-to-date. It has raised $11.5m  via placement to help fund the initial $39m 1,000tpa plant.

 

EMPIRE RESOURCES (ASX:ERL)

(Up on no news)

This busy polymetallic explorer has already drilled 13,000m so far in 2021 at the ‘Penny’s and Yuinmery’ projects in WA, with diamond drilling of some juicy gold, copper, and nickel-copper-PGE targets at Yuinmery due to kick off sometime this month.

ERL would’ve drilled even more if not for issues getting hold of a rig, something the company intends to fix in 2022.

“Our exploration plans for 2022 include the lock-in of a core drilling rig and driller for exclusive use by Empire,” chairman Michael Ruane says.

“This should assist in accelerating at least the drilling component of our exploration programs for the forthcoming period. The rig will be particularly useful for the deep drilling required for the promising Yuinmery targets (eg Smiths Well/YT01).”

The rig should be ready for commissioning this month, he says.

The $14.85m market cap stock is up 30% over the past month. It had about $3.5m in the bank at the end of November.


The post Resources Top 5: Hopeful uranium stocks, an important graphite deal, and lots of imminent news flow appeared first on Stockhead.







Author: Reuben Adams

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Energy & Critical Metals

Met testwork proves Sovereign’s Kasiya will deliver a premium natural rutile product

Special Report: Metallurgical testwork has confirmed Sovereign Metals’ Kasiya project in Malawi will deliver a premium natural rutile product, setting…

Metallurgical testwork has confirmed Sovereign Metals’ Kasiya project in Malawi will deliver a premium natural rutile product, setting the stage for the company’s landmark scoping study.

Testwork continues to demonstrate the world class nature of Sovereign’s (ASX:SVM) Kasiya deposit, with simple and conventional processing delivering levels of 95% to 97.2% TiO2 with low impurities at stand-out metallurgical recoveries ranging from 94% to 100%.

That makes Kasiya competitive on TiO2 grades with some of the world’s largest natural rutile operations like Iluka’s Sierra Rutile and Rio Tinto’s Richards Bay Minerals.

It opens the door for discussions with tier-1 offtakers in the markets for TiO2 pigment, titanium metal and welding, where customers are facing widening supply deficits in a strengthening market.

Additionally, testwork has shown conventional flotation methods can be used to produce a coarse flake graphite by-product from rutile gravity tails with 60% at a coarseness of +150µm, suggesting it will have a high basket value when sold to market.

A program at SGS Lakefield in Canada confirmed simple processing methods delivered a very coarse-flake graphite concentrate at 96.3% TGC.

“Consistently achieving premium rutile specifications with stand-out recoveries via conventional “off the shelf” processing methods reinforces the robustness of metallurgical and processing performance of the Kasiya rutile mineralisation ahead of the upcoming Scoping Study,” Sovereign managing director Dr Julian Stephens said.

“These continued very high-quality product specifications should generate further interest from end-users across the titanium sector as the global structural deficit in natural rutile supply continues to widen.”

Processed rutile being despatched to potential customers. Pic: Sovereign Metals

Kasiya scoping study round the corner

With the results in today’s announcement, Sovereign has now demonstrated the impressive metallurgical qualities of the Kasiya resource in two separate rounds of met testwork.

The testwork also confirms Kasiya will deliver strong recoveries and product specifications based on conventional off-the-shelf processing technology, which bodes well for its future development.

Proving the original results were certainly no fluke and opening the door to interest from Tier-1 offtake customers, they set up Sovereign to release a scoping study in the coming weeks.

With most of the technical disciplines now complete, mining optimisation and capital and operating cost estimations are currently being finalised.

A new indicated mineral resource estimate is also on the way after substantial resource drilling to build upon the world-class inferred resource released in June.

That confirmed Kasiya as one of the largest natural rutile deposits in the world, with an inferred resource of 644Mt at 1.01% rutile and a high-grade component of 137Mt at 1.41% rutile.

 


 

 

This article was developed in collaboration with Sovereign Metals, a Stockhead advertiser at the time of publishing.

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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Author: Special Report

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I see you: Red Mountain Mining contacts heavy rare earth elements at Mt Mansbridge

Special Report: Red Mountain Mining’s 1,200m RC drilling program at the Mt Mansbridge project in WA is off to a … Read More
The post I see you: Red…

Red Mountain Mining’s 1,200m RC drilling program at the Mt Mansbridge project in WA is off to a good start, with heavy rare earth elements (HREE) discovered in four holes.

A shortened drill program due to the onset of the Kimberley wet season, hasn’t stopped the company cracking open xenotime (dysprosium) mineral within sample drill chips.

There’s also a pulse-raising 6m mineralized heavy rare earth zone (49-55m) intersected in hole MMRC002 at the Solo prospect and finally drilling has intersected altered peridotite at Déjà vu – prospective for cobalt mineralization.

Red Mountain Mining (ASX:RMX) is already prepped for drilling once the site is accessible again in early 2022.

Solo prospect samples prioritised for assay

The prospect is a +200m NW-SE trending zone of HREE mineralisation initially identified by BHP (ASX:BHP) during uranium exploration in the 1980’s.

Three RC holes for 451m were completed at the prospect during the drilling program, with a 6m zone (49-55m) of xenotime mineralisation identified.

Visual estimations of the xenotime mineralisation ranged from between 1-10% of the total composition of minerals over the 6m zone.

On-site analysis using a portable XRF confirmed the zone as anomalous in both yttrium and ysprosium, and the zone has been prioritized for assay at the laboratory for immediate analysis.

Red Mountain Mining
Rare earth element and nickel-copper-cobalt-PGE prospects at the Mt Mansbridge project

Déjà vu prospective for cobalt

Previous sporadic sampling and assaying at the Déjà vu prospect returned several encouraging cobalt assay results between 70-100m including 0.34%, 0.32% and 0.22% cobalt.

Litho-geochemical studies recently undertaken by geochemical and geological consultants highlighted the cobalt as primary magmatic related (i.e. not weathering enrichment) while the anomalous cobalt values can’t be down to just silicate minerals within the peridotite.

Hole MMRC004 has been drilled to a depth of 75m, with the hole designed to provide further geological information and a comprehensive set of samples around the existing cobalt anomaly.

Samples have been prioritized at the lab for immediate assay, with further deeper drilling and an additional hole to the north and south planned for early 2022.

 


 

 

This article was developed in collaboration with Red Mountain Mining Limited, a Stockhead advertiser at the time of publishing.

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

The post I see you: Red Mountain Mining contacts heavy rare earth elements at Mt Mansbridge appeared first on Stockhead.




Author: Special Report

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