‘Over-reaction’: Pilbara gold stocks partially recover as Artemis shows new nuggets
Pilbara gold bellwether Artemis Resources has partially rebounded from Monday’s losses after showing off a crop of new nuggets from land it is acquiring south of Karatha, Western Australia.
The news pushed Artemis’ (ASX:ARV) share price up 19.3 per cent to a peak of 34c by mid-morning. The shares cooled to 31.5c by Wednesday close — a partial recovery after the falls of Monday — but still well down on its high of 59c in early November.
A disappointing update from Canada’s Novo Resources over the weekend prompted the losses on Monday. Novo is Artemis’s partner in Purdy’s Reward — a nearby project where the Pilbara gold rush started in July 13 when the pair first announced a gold nugget find.
Artemis today told investors that local prospectors had recovered gold nuggets on 300 sq km of tenements it is acquiring close to its Comet Well and Radio Hill projects.
The gold nuggets appear to be both specimen gold and watermelon seed.
Watermelon seed nuggets have been all the rage since July when Artemis and Novo found small, flat seed-shaped gold nuggets near Karratha in northern Western Australia.
The tenements where the nuggets are being found are currently under application, so Artemis has been observing local prospectors to see what they find on the surface until the tenements are granted and the company can undertake a more significant exploration program.
A large quantity of gold nuggets were found previously on another part of the land package.
“I witnessed people pulling lots and lots of gold out of that area, literally thousands of ounces of gold came out,” Artemis executive director Ed Mead told Stockhead, referring to the original gold rush’ at the start of last year, which included tenements that Artemis is acquiring from Elysian Resources.
Gold nuggets are now being found on tenements adjacent to Artemis’ Comet Well and Radio Hill projects.
Making a comeback
Pilbara gold stocks appear to be making a recovery after investors got spooked earlier this week on news Novo was not happy with the integrity of the sample results produced from large diameter drilling at Purdy’s Reward for the critical purpose of gold grade estimation.
De Grey Mining (ASX:DEG) closed up 11.8 per cent at 19c, while Coziron Resources (ASX:CZR) climbed 14.3 per cent to 2.4c. Kairos Minerals (ASX:KAI) gained 1.9 per cent to close at 5.5c, Chalice Gold Mines (ASX:CHN) added 2.8 per cent in Wednesday afternoon trade, but retraced its gains to close down 2.8 per cent at 17.5c, and DGO Gold (ASX:DGO) shifted up 1.6 per cent to $1.30.
The earlier sell-off was an “overreaction to when Novo came out and said that rig is essentially not a good choice and they’re looking for a better rig”, Mr Mead said.
“It’s not that the large diamond drill is not working, it’s the configuration of the rig that was there was not working.
“Since that release, and we’re not the operator of the joint venture at this point – it’s Novo, but separately a whole lot of people have been contacting me saying we know how to drill this.”
Artemis is confident there are other ways to tackle the nuggetty gold and prove up an economic gold deposit.
“We’ve all heard about the extreme nugget effect and difficulties with drilling, but we still see that there are lots of ways to deal with this style of ore deposit,” Mr Mead said.
“One of the ones we look at is a combination of trenching for the shallow stuff and doing shafts for bulk samples, which is the same way that effectively the Argyle diamond mine was tackled.
“For this type of style of mineralisation, which is obviously conglomerate gold, we’re basically going back in time.”