Morning News Bites – October 21

Red 5 Upgrade Mineral Resource for Satellite Pit.

Red 5 Limited RED) reported an updated Mineral Resource and maiden Ore Reserve estimate for their Great Western gold deposit, a satellite deposit located near Red 5’s Darlot Gold Mine in Western Australia, ahead of the planned commencement of open pit mining in January 2021.

The Great Western deposit was acquired by Red 5 in April 2020 for $2.2m and forms part of their Darlot Mining Hub strategy. Ore from the Great Western pit will be trucked to the Darlot Mill for processing.

The open pit mining operation will be underpinned by a maiden Open Pit Ore Reserve of 437,500 tonnes grading 2.5g/t Au for 35,424oz of contained gold. Based on a proposed mining rate of between 30,000 to 40,000 tonnes of ore per month, the open pit is expected to be completed over ~13 months, with plans to then access the underground orebody via a portal at the base of the pit.

Red 5’s Managing Director, Mark Williams, said:  “The Great Western deposit has emerged as a strong source of satellite ore feed for the Darlot processing plant, with the completion of an initial Open Pit Ore Reserve of 35,424 ounces of contained gold paving the way for the start of open pit mining planned for January 2021. Importantly, this will also provide a platform from which to pursue a potential longer-term underground mining operation.

CZR Resources to Complete PFS.

CZR Resources (CZR) has announced that the PFS on its Robe Mesa Iron Ore Project in WA’s Pilbara is progressing well and is set for completion in December this year.

The PFS is focused on a simple, low capex DSO iron-ore mine that aims to maximise the use of existing infrastructure and a trucking model for transport of product to port. Closer port options (within a 100km radius of Robe Mesa) between Onslow and Dampier may present an opportunity to reduce the haulage distance to port, as other companies look to develop new port infrastructure along the coastline.

Robe Mesa has a JORC 2012-compliant Indicated and Inferred Resource of 84.5Mt at 53.8% Fe using a cut-off of 50% Fe and calcining to Fe at 60.2% This includes a higher-grade resource component of 24.7Mt at 56% Fe (that calcines to 62.7% Fe) that is the focus of the PFS.

Given the current strength of the iron ore market, CZR is assessing a direct shipping ore (DSO) mining operation of 1.5 to 2.5 million tonnes per annum, utilising road-trains to haul ore approximately 400km from Robe Mesa to Port Hedland.

The strong outlook for Robe Mesa has been confirmed by the Company’s recent discussions with leading Asian steel mills and trading houses regarding the acceptability of the product and likely pricing points based on an indicative ore-specification.

Lynas Corporation Release Quarterly Report.

Lynas (LYC) released their quarterly report this morning and some of the information coming from it was: As a result of the the temporary shutdowns in both Malaysia and Mt Weld because of COVID-19 Movement Control Order (MCO) issued by the Malaysian government, production of NdPr was at 75% of Lynas NEXT production rates during the quarter (equivalent to original nameplate production rates). Lynas says it is currently sufficient to meet demand from their customers while COVID-19 uncertainty remains.

Total NdPr production during the quarter was 1,342 tonnes, up from 775 tonnes in the previous quarter and Total Rare Earth Oxide production was 4,110 tonnes, compared to 2,579 tonnes in the previous quarter. Sales revenue was A$87m during the September quarter, up from A$38m in the previous quarter.

The company remained cash flow positive during the quarter, as they captured efficiencies while running production at original nameplate. They expect to see an increase in expenditure related to Lynas 2025 projects in the coming months.

During the quarter they completed a A$425 million equity raising to fund Lynas 2025 foundation projects. One of those projects is the Kalgoorlie Rare Earth Processing Facility. They have now awarded the contract for the longest lead time item, the kiln, for facility, signed a sub-lease with the City of Kalgoorlie Boulder (CKB) for the industrial zoned site selected for the Kalgoorlie Facility and obtained a General Purpose Lease under the Mining Act.

BHP Shelve Olympic Dam Project.

In their quarterly report, yesterday, BHP (BHP) announced it will put on hold its planned multibillion-dollar expansion at South Australia’s Olympic Dam, after studies of the ore body revealed underwhelming prospects.

The plans were to spend up to $3.5B on the Brownfield Expansion but studies have shown that the copper resources in the southern mine area are more structurally complex, and the higher-grade zones less continuous, than previously thought.  This is despite BHP reporting the highest quarterly production since 2015.

Part of the report said; Following more than 400 km of underground drilling associated with the Brownfield Expansion (BFX) project studies, we have improved knowledge of the ore body’s variability. This has provided challenges for the economics of the BFX project, and we have decided the optimal way forward for now is through targeted debottlenecking investments, plant upgrades and modernisation of our infrastructure.

It will be a blow to the SA economy, especially on the back of the damage done by the impact of Covid19.  There were hopes that the project would create 1,800 jobs on the construction side and once completed 600 permanent roles in the operation.

The company is still expected to spend about $1.5B on Olympic Dam over the next two years.  Whether this gives hope to the Brownfield Expansion being resurrected, only time will tell.

KIN Mining High-Grade Results.

Kin Mining (KIN) has released a report announcing significant new assay results from recent diamond and Reverse Circulation drilling at the Cardinia Hill prospect as part of the ongoing Phase 3 drilling program at its 100%-owned Cardinia Gold Project, located near Leonora in Western Australia.

The Cardinia Hill prospect, located 2km from the proposed processing plant site, is a recent discovery at the Cardinia Gold Project and has been the focus of a resource drill-out program designed to underpin a maiden Mineral Resource estimate as part of a project-wide update by year-end.

Commenting on the latest Cardinia Hill results, Kin Mining Managing Director Andrew Munckton said:  “Diamond drilling is continuing to deliver excellent results at Cardinia Hill, with high-grade gold associated with the pyrite mineralisation intersected at depth in the Southern Shoot and strong intersections also achieved within the Northern Shoot. This highlights the potential for good continuity of the mineralisation, with an improving grade profile, at depth within the recently completed resource drill-out.”

“While our main focus is on establishing a maiden Mineral Resource estimate for Cardinia Hill by the end of this year, the diamond drilling has given us a much better understanding of the geological controls on the mineralisation and also highlighted the potential for discovery of shallow additional zones and extensions to the existing mineralisation into underground mining positions in the future.

Some of the targets hit were 5.4M at 6.18g/t from 186.4M and 5.3M at 3.31g/t from 96M and they confirm the extension of the resource at depth.

Morning News Bites – September 2

In Today’s Morning News Bites for September 2. Former Facebook CEO says new ban on news ‘threatens all Australians’. China announces suspension of Barley imports from Australian CBH Grain. De Grey Mining Limited reports an update at the Hemi Gold Discovery. 

De Grey Mining Limited reported the following drilling update at the Hemi Gold Discovery, located approximately 60km south of Port Hedland in Western Australia. Recent drilling has delineated a highly brecciated and extensively sulphide altered subvertical intrusion. This new intrusion has been named Falcon, which has been intersected for over 1.8km in strike, up to 80m thick and to 200m below surface. The intrusion remains open along strike and at depth. Gold mineralisation defined over 1.5km in aircore drill assays with additional assays from drilling along strike is pending. Initial aircore results include a highlight of 21m @ 3.4g/t Au from 40m and 19m @ 2.1g/t Au from 68m.

Metalicity Limited announced the return of the drone magnetic geophysical interpretation for the DCC and Altona Trends from the Kookynie Gold Project in the Eastern Goldfields, Western Australia, approximately 60 kilometres south southwest of Leonora. The company has received all data and interpretations from the ultra-high-resolution drone magnetic survey. The results indicate 21 targets that have similar geophysical and structural settings to known mineralised areas. Furthermore, drilling is still being conducted, there are 24  drill holes remaining at the laboratory pending analysis, which is due imminently with further samples being dispatched periodically, for the Kookynie Gold Project. Commenting on the target generation, Metalicity Managing Director, Jason Livingstone said: “The Footprint of the Kookynie Gold project continues to grow with a further 21 targets across granted tenure being generated from this exercise, this is incredibly exciting.”

Wiluna Mining reports high‐grade results from a further 68 holes and 18,584m of resource development infill drilling at the Wiluna Mining Centre, WA. The Company continues to drill with six rigs currently on site. Infill drilling at Golden Age produces ultra‐high grades up to 880g/t. Milan Jerkovic, Executive Chair commented: The outstanding results provide confidence in our Mineral Resource and Reserve estimates as we release them on a rolling basis from September 2020 through to December 2020 and into next year.”

Strong new drilling results confirm potential to expand existing 4.1Moz Resource at King of the Hills for RED 5 Limited. Latest assays continue to emphasise the scale and quality of the King of the Hills Mineral Resource and opportunities for future Resource extensions, with results including 5.1m @ 56.4g/t Au and 19.2m @ 5.4g/t Au. Managing Director Mark Williams, said recent drilling at King of the Hills (KOTH) had delivered a host of excellent results. “This has been a highly successful drilling program that has both increased our confidence in the existing 4.1 million ounce KOTH bulk Mineral Resource model as well as identifying targets for future Resource growth.”

Further strong assay results from recent aircore (AC) drilling at the East Lynne prospect for Kin Mining, located 3km north-east of the proposed plant site at its Cardinia Gold Project, located near Leonora in Western Australia. The latest East Lynne results confirm mineralisation over 1.3km of strike length. Highlights include, 20m at 0.96g/t Au from 20m, 4m at 2.21g/t Au from 20m and 12m at 1.28g/t Au from 12m. Commenting on the latest drill results, Managing Director Andrew Munckton said:  We are eagerly awaiting results from the remaining eight lines of this broad-spaced AC program to get a clearer sense of the potential scale of this target ahead of follow-up RC drilling.

Morning News Bites – August 27

Woolworths recorded boom sales, but the impact of COVID-19 and one off costs have added up, Independence Group record a 12.5% increase to revenue and Flight Centre recorded a $510m underlying loss before tax.

Drilling services provider Boart Longyear has announced revenue of US$309M down around US$79M this morning. Net cash flow from operating activities though was up US$10M to US$30M due to Net Working Capital initiatives. Jeff Olsen CEO said “Management implemented plans in March that would ensure the Company would be able to continue to support the mining industry when normal activity levels resumed. The actions taken, including significant pay reductions across the world, ensured the business would generate positive EBITDA and cash from operations and were vital in supporting the company with having the required liquidity to support a growing business through the second half of 2020.”

Diamond drilling is now underway at Galileo`s Fraser Range prospect in Western Australia. Three diamond drill holes with planned depths from 200 to 380 metres will be directed to test an EM conductor, a structural target, and the known disseminated sulphide mineralisation. Brad Underwood, Managing Director said this is an exciting opart of teh exploration process underway and will look forward to updating the market when results are known. He also said “This is our first diamond drilling program at our northern Fraser Range project. It is also the first diamond drilling program ever to be undertaken looking for nickel in our project area. As such, this greenfields project has great potential and is also very well located within the emerging new nickel province of the Fraser Range. We have approximately 500 metres of diamond drilling planned across three separate areas with each zone showing potential for sulphide mineralisation.”

Drilling at Capricorn’s Karlawinda Gold project – Supplied

Capricorn Metals has announced MACA limited are the preferred mining contractor for its Karlawinda Gold Project. The five year deal is worth around $400m with Preproduction mining activities to commence in the December 2020 quarter. Capricorn Executive Chairman Mike Clark said “The selection of a preferred mining contractor is the culmination of a competitive process that included a number of very competent Australian mining services providers. MACA was selected as the preferred contractor after submitting a compelling bid both in terms of price and execution. We look forward to partnering with MACA in the successful operation of the Karlawinda Gold Project.”

A maiden two hold diamond drill program for Talisman Mining`s Lucknow Gold Project has been completed. The program was targeting the interpreted high-grade lode offset position of the historical Lucknow gold mine. The second drill hole of the program delivered a zone of strong foliation and quartz veining from 297m to 303m downhole. According to Talisman the recent drilling, supported by a structural and geological interpretation, suggests that the ultramafic stratigraphy and prospective contact has been offset to the north-west by a sinistral fault – indicating a potential target to the north-west of recent drilling.

Results from Cardinia Hill RC drilling with Kin Mining have revealed the presence of two north-plunging shoots of higher-grade mineralisation within the main lode. Kin Mining Managing Director Andrew Munckton said the RC program had provided a good base for Kin “The follow-up phase of RC drilling at the northern end of Cardinia Hill has been successful in intersecting the northern shoot of mineralisation at depth, further improving our understanding of the geometry and scale of the deposit – and providing a solid foundation for planned resource drilling. The diamond drill core is also providing strong insight for our exploration team in terms of understanding the internal detail of the deposit.” he said.

Morning News Bites – August 24

In Today’s Morning News Bites for August 24. Fortescue Metals report 49% increase in net profit to a record $US4.7bn. QLD reports one new COVID-19 case overnight. Liberal call for branch clean-out. 

Fortescue Metals report strong results from FY20, exceeding production guidance with 178.2 million shipments of iron ore for the full year. Costs remain low: C1 costs came in at US$12.94 per wet metric tonne in FY20. The company achieved average revenue of US$79 per dry metric tonne in fiscal 2020, up 21% YoY and has guided for FY21 iron ore shipments of between 175-180 million tonnes. Former CEO, and current non-executive chairman Andrew Forrest said, ”Fortescue’s success allows Minderoo Foundation the capacity and the flexibility to continue its work and tackle new challenges as they arise for many years to come.”

Saturn Metals announce further results from ongoing RC drilling at the Apollo Hill deposit within its Apollo Hill Gold Project, 60km southeast of Leonora in the Western Australian goldfields. This drilling at Apollo Hill is a key part of the Company’s strategy to grow the Project’s 781,000oz Mineral Resource. A further resource upgrade is targeted for late 2020, incorporating results from drilling conducted since November 2019. All 13 holes reported intercepts above the Apollo Hill resource cut-off grade and all but one intersected mineralisation above the average resource grade. Other strong intersections include: 21m @ 0.94g/t Au from 184m – , 9m @ 1.0g/t Au from 179m and 14m @ 0.84g/t Au from 329m.

Kin Mining NL significant new assay results received from recent air-core drilling at the East Lynne prospect, located 3km north east of the proposed plant site at its Cardinia Gold Project near Leonora in Western Australia. The drilling commenced at East Lynne in early July as part of the extensive and ongoing Phase 3 Exploration Program. Significant widths and grades encountered in 400m line spaced AC drilling, with in-fill drilling to 200m line spacing underway. Results include 20m at 1.36g/t from 20m and 4m at 1.29g/t from 32m.

St Barbara reports its Mineral Resources and Ore Reserves positions for FY20. Group Ore Reserves increased year on year from 4.1 Moz of contained gold to 6.0 Moz, and Group Mineral Resources increased from 9.6 Moz of contained gold to 11.6 Moz. The increase in Resources and Reserves is due to the Atlantic Gold acquisition concluded in July 2019 and Simberi sulphide drilling completed in December 2019.

Zenith Minerals Wide mineralised gold zone confirmed at the Red Mountain Gold Project for Zenith Minerals. New gold assay results from the first 7 follow up RC holes of an ongoing drill program, confirm near surface, wide, mineralised gold zone at Red Mountain Gold Project in Queensland. This includes highlights of 12m @ 2.2 g/t Au from surface, including 8m @ 3.1 g/t Au and 5m @ 1.7 g/t Au from 25m, including 3m @ 2.6 g/t Au

Morning News Bites – July 24

The first gold pour for Horizon Minerals - Supplied

In today’s morning news bites – Gold nears 1900US/oz overnight (~$2644A/oz), National cabinet meets today and Apple delays its iPhone 12.

A first diamond drill hole for Talisman Mining has resulted in 0.81m @ 2.34 g/t Au from 467.1m Including 0.14m @ 4.10 g/t Au from 467.1m and 0.45m @ 1.34 g/t Au from 491.5m at its Lucknow Gold Project in New South Wales. According to Talisman the hole intersected a highly fractured zone which is interpreted to represent the flat-lying fault that has offset the main lode controlling stratigraphy, but did not intersect the targeted ultramafic contact due to what appears to be a second cross-cutting fault. Talisman’s Lucknow Gold Project is part of a farm-in with privately-owned Lucknow Gold Limited.

Gold Road Resources JV Gruyere mine produced a record 71,865 ounces of gold during the quarter and remains on track to meet 2020 annual guidance 250,000 to 285,000 ounces. In some financial news Gold Road Resources became debt free having repaid the remaining $25 million of debt on 21 July 2020, while retaining liquidity in excess of $85 million. Gold Road also secured funding for five projects on Gold Road 100% owned tenements or through the Gruyere JV and Cygnus JV with the WA State Government Exploration Incentive Scheme The $560,000 of funding will be used to advance greenfields exploration and geological understanding.

Drill results for Phase Three with Kin Mining at Cardinia Hill have been announced. The results of the RC drilling include a highlight of 17m at 2.35g/t Au from 6m including 5m at 5.2g/t Au. A resource definition at Cardinia Hill is set to start soon. Kin Mining Managing Director, Andrew Munckton, said: “The initial phase of RC drilling at Cardinia Hill undertaken as part of the broader Phase 3 program has been successful in upgrading our understanding of the geometry and scale of the deposit – providing a solid foundation for planned resource drilling. “Confirmation of the presence of two shoots of north-plunging higher grade mineralisation coincident with strong magnetic signatures from our new airborne magnetic survey work is an important development which gives us confidence that we can advance the Cardinia Hill deposit to a Mineral Resource estimate relatively quickly”.

Dr Colin Rose, Marmota Limited Chairman has announced the drill program for Aurora Tank is the most exciting to date “This is Marmota’s largest ever RC drill program at Aurora Tank and with a special focus on primary mineralisation extensions. It is shaping up as one of our most interesting, varied and exciting drill programs to date.” he said. Drilling has commenced with a RC drill program of 85 holes over 7,500m for around 3 – 4 weeks.

The first gold pour for Horizon Minerals - Supplied

The first gold pour for Horizon Minerals has taken place from its Boorara Gold Mine. Jon Price Horizon Managing Director said “First gold production from Boorara is an exciting milestone for the Company and it is extremely pleasing to see the mine performing to expectations. The Horizon team and our contracting partners have done an excellent job to date with the Lakewood Mill running extremely well.” Mining commenced at Boorara on May 5 2020 and the initial gold pour took place July 23, 2020.


Morning News Bites – July 20

Prime Minister Scott Morrison’s popularity has increased to its highest level in 12 months in the latest Newspoll, COVID-19 spread in New South Wales attracting more concerns and interest around Newmont and Northern Star Resources as NSR let lapse its exclusive purchase rights according to the AFR.

  • Classic Minerals has purchased a Gekko Processing Plant to use at Kat Gap 130km south east of Southern Cross. The gravity concentration processing plant has a capacity of 30 tph and is a flexible design for mobility is scaleable to a Gekko Python Plant with a processing capacity of 250tph. The Gekko plant is ideally suited to the Kat Gap ore which has a very unique high level of gravity gold concentration.
  • Kin Mining has announced a new Australian share holder who has subscribed for $1m in shares while Kin`s two largest shareholders (Delphi and Harmanis) subscribed for an additional $573,000. Kin has restricted the amount of new shares on offer after the recent rights issue. Phase 3 drilling is fully funded until the end of FY 2021 and a strong news flow from drilling is expected. Kin Mining’s Managing Director, Andrew Munckton, said “The additional funds raised through the placement of this Shortfall, together with the $6.066 million already raised from the Rights issue, gives us the capacity to complete our Phase III exploration program across the Cardinia exploration targets to the end of FY2021, as planned.”  
  • The new camp at Aurora Tank has arrived and has been installed at Marmota for it’s, Aurora Tank Gold Discovery. The camp is operational and drillers are expected on site tomorrow (July 21 2020). Marmota recently raised $6.5M and received a $225,000 grant from the South Australian Government as part of the Accelerated Discovery Initiative. 
  • South32 has achieved record production in Australia with its Australia Manganese Ore Joint Venture in the FY20, alongside record results at its Brazil Alumina and Hillside Aluminium operations. Australia Manganese saleable ore production increased by 4% as Manganese ore sales increased as market conditions were favourable. S32 saw saleable production increase by 2% at its 86% share Worsley Alumina, where improvement initiatives are expected to support a sustainable increase in production to nameplate capacity.  While Cannington in Queensland has reduced its run of mine stocks and a further improvement in underground mine performance helped push a 14% lift in ore processed. According to South32 CEO Graeme Kerr,  “Our priority remains keeping our people safe and well, maintaining reliable operations and supporting our communities through the COVID-19 pandemic. Despite the health crisis, we delivered a strong operating result, highlighted by annual production records at Brazil Alumina, Hillside Aluminium and Australia Manganese ore. We have continued to see good demand for our products, with sales exceeding production at the majority of our operations. With uncertainty remaining in global markets we continue to manage our financial position to ensure we retain the right balance of flexibility, efficiency and prudence. Looking forward we remain focussed on reducing controllable costs, managing counterparty and supply chain risk and optimising working capital to ensure the business remains resilient during a potentially extended period of volatility and lower commodity prices.”
  • Drilling for Thomson Resources at their Harry Smith gold prospect on the Lachlan Fold Belt in New South Wales, has been put on hold due to wet ground. However drilling is being undertaken and has commenced at Yalgogrin gold project while waiting for ground to dry at Harry Smith. Wet weather, fog and the ground conditions around Harry Smith has meant the suitability of drilling is not conducive and the time for the ground to dry will take a number of days. This has resulted in the AMWD drilling rig being mobilised to Yalgogrin. Once ground is suitable, drilling will recommence at Harry Smith.



Quick Notes –

Legend Mining has added Oliver Kiddie to its board as an Executive Director. Mr Kiddie will commence August 10 2020 as Derek Waterfield will move away from his board role and take up the role of General Manager Exploration.

Halloysite confirmed across the Eyre Pennisula for Archer Materials. Greg English, Archer Chairman said “We have directly identified halloysite, which is a high value form of the alumina-silicate clay kaolin, at Kelly Tank, Bunora and Bunora East prospects. This is an excellent result that confirms reports of the [kaolin] mineralisation by historic explorers, as well as the presence of halloysite across a large geographical area with all samples tested being close to surface.”