A $4m market cap + 69,000oz resource in WA + huge growth potential with new drilling program = …
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Special Report: There’s a modern-day gold rush on in WA.
Not the type where people come running with picks and shovels, but rather with cheque books in the hope of securing established resources which can be combined with other nearby deposits to provide scale and feed a central plant.
In a world of declining gold reserves, high-quality deposits within trucking distance of a plant are in strong demand.
And this is the opportunity fast opening-up for First Au (ASX:FAU) and its shareholders. Thanks to its Gimlet gold discovery just 15km north of Kalgoorlie, First Au is well on its way to being a key player in any consolidation strategy which unfolds in this historic goldfield.
First Au started drilling at Gimlet a little over a year ago and it has already established a JORC resource of 69,000oz.
The discovery sits next door to the Teal, Jacques Find and Peyes Farm gold deposits owned by Horizon Minerals (formerly Intermin Resources), which has amassed a 289,000oz resource between the three.
Gimlet is also within close trucking distance of five gold mills in the Kalgoorlie area, with several offering the toll treatment of ore to third parties.
With the maiden resource under its belt, the scope to grow Gimlet is considered substantial, with the mineralisation remaining open in every direction.
A recent aircore drilling program successfully identified shallow gold mineralisation and related alteration up to 1.6km from the existing resource.
These results are important because the features observed in several of the drill holes are similar to those observed in the early aircore programs that resulted in the Gimlet discovery.
First Au is now embarking on another round of deeper drilling as part of its strategy to grow the 69,000oz resource.
The initial part of this program involves diamond drilling to test the down-dip extent of mineralisation below the current resource. The two diamond holes will be followed by a reverse circulation (RC) drilling program.
Previous drilling has shown that the mineralisation improves with depth, with one diamond hole returning 32m at 4.9 grams per tonne (g/t) from 93m and an RC hole intersecting 15m at 6.6g/t from 157m.
This new drilling program will test below 150m deep along the 450m strike of mineralisation.
In conjunction with this drilling, a high-definition SAM (sub-audio magnetics) survey will be completed at the Horan’s Dam prospect just west of Gimlet.
SAM is tailored for high-definition mapping of magnetic and electrical properties in the sub-surface and can overcome the difficulties of highly conductive surface layers like the paleolakes seen at Gimlet.
The data produced from this survey will provide structural targets for a planned RC program at Horan’s Dam once the drilling at Gimlet has been completed.