Rio Tinto gets its hands on more Paterson ground with +$12m Sipa farm-in

Rio Tinto (ASX:RIO) is on the hunt for more ground in the extremely hot Paterson Province after releasing a maiden resource for Winu, and junior explorer Sipa Resources (ASX: SRI) is the first beneficiary with a +$12m deal.

At the same time, gold is continuing to close in on the magic $US2,000-an-ounce mark.

Gold ticked up to $US1,982/oz ($2,776/oz) in early Monday trade, up 0.3 per cent from Friday, and chalking up 11 straight days of price gains, according to gold website Kitco.

Market analysts pointed to the US dollar’s move lower against other major currencies, particularly the Euro, as a bullish factor for gold.

The US dollar index, a measure of the American currency against a basket of other currencies including the British Pound, dipped to 93.43 Monday — its lowest point since April 2018.

US Federal Reserve chairman Jerome Powell said the central bank was prepared to do more to rescue the US economy from recession with looser monetary policy.

Powell was reported as saying last week the Federal Reserve will “do what we can, and for as long as it takes”.

Silver is also doing well and was trading at $US24.15/oz on Monday.

Paterson tie-up

Rio Tinto Exploration (RTX) has signed a deal to earn an interest in Sipa’s Paterson North copper-gold project in WA’s Paterson hot spot that lies 10km west of Rio’s Winu copper-gold discovery.

Sipa’s shares were up almost 24 per cent on Monday morning to an intra-day peak of 10.5c.

Sipa Resources (ASX:SRI) share price chart

RTX has committed to spend a minimum of $3m and up to $12m on exploration to earn an interest of up to 70 per cent in the Paterson North project.

The Rio Tinto subsidiary also plans to inject $250,000 into Sipa via a placement at 10c per share, a 14 per cent premium to the company’s 10-day volume weighted average share price.

RTX also has the option to increase its final stake to 80 per cent if exploration work leads to a JORC-compliant mineral resource with an in-situ value of at least $1bn or completion of an “order of magnitude” study.

“Attracting a global major such as Rio Tinto to the Paterson North project reflects both the enormous potential of the ground and the quality of the work which the Sipa exploration team has completed over the past five years,” managing director Pip Darvall said.

Rio Tinto unveiled last week a maiden inferred resource for its 100 per cent-owned Winu copper-gold project of 503 million tonnes at 0.45 per cent copper equivalent, including a higher-grade component of 188 million million tonnes at 0.68 per cent copper equivalent.

West African gold brings in the investors

West Africa-focused gold explorer Tietto Minerals (ASX:TIE) has put together a $62.5m capital raising for its Abujar gold project after receiving strong commitment from investors.

The company recently started a pre-feability study for its 2.2-million-ounce Abujar gold project in Cote d’Ivoire (Ivory Coast) and has four diamond drill rigs operating on site.

Hartleys and Cannaccord Genuity were joint lead managers for the company’s placement and underwriters that raised a total of $57.5m, and the company is undertaking a share purchase plan for an additional $5m.

“This placement means Tietto is now fully funded to deliver its pre-feasibility and definitive feasibility study next year, and have great flexibility to commit to some long lead time items related to mine development,” managing director Dr Caigen Wang said.

Rolling out the high-grade hits

Meanwhile, E2 Metals (ASX: E2M) has identified a new high-grade vein target at its Emilia prospect with rock sampling returning a hit of up to 6.73 grams per tonne of gold and 549g/t of silver.

The Emilia vein is within a very strong (more than 1g/t) silver soil anomaly up to 370m wide that extends 1.5km along strike at the company’s Conserrat project, 30km northwest from AngloGold Ashanti’s (ASX:AGG) Cerro Vanguardia gold and silver mine in Argentina.