ASX Quarterly Wrap: A robust scoping study in Argentina and Mark Creasy increases his holding in PGD
It’s quarterly season again as the ASX market announcements page becomes increasingly flooded with update lodgements.
To save you the trouble of trudging through it all, we’ve wrapped up the highlights from some of the reports that caught our eye.
During the quarter, the company released a robust scoping study for its Hualilan gold project in San Juan, Argentina.
The “outstanding” economics included forecast EBITDA of US$738 million ($1.1 billion) over the life of mine, rapid payback of under 1.25 years based on the current production of 116,000ozpa gold, 444,000ozpa silver and 9,125tpa zinc and lowest-quartile C1 cash costs of US$527/oz ($811/oz) and all-in sustaining costs of US$830/oz ($1,277/oz).
Pre-tax NPV is estimated at US$409 million ($629 million) when assuming US$1,750/oz gold US$20/oz silver prices, but increases to $869 million at current $US2,035/oz gold and US$23/oz silver prices.
CEL has already identified several “material” opportunities to improve on the scoping study outcomes, including via the recently confirmed conversion of the gold-silver concentrate produced by the flotation circuit into dore on site, thus potentially reducing transport costs and treatment/refining charges, and increasing payability.
Other areas earmarked for evaluation are inclusion of a heap leach alongside the flotation to capture value from the low-grade portion of the Hualilan orebody, reduction in the cut-off grade of zinc ore fed into the flotation circuit and lower open-pit mining unit costs through deployment of owner-operator and bulk mining efficiencies.
New targets have also emerged from CEL’s region exploration program, while the company is awaiting completion of an independent report before updating the existing resource at its El Guayabo/Colorado V gold-copper project in El Oro, Ecuador.
The strategic sale of its non-core Lewis Ponds and Mt Bulga projects to Minerals Pty Ltd is set to deliver $11 million cash for GRL to pump into its flagship Narraburra rare earths project in New South Wales.
GRL confirmed the initial $5,000 deposit has been received and the first payment of $2.95 million under the binding share sale and purchase agreement is expected this March quarter.
Phase 2 metallurgical test work on samples from Narraburra are currently with the Australian Nuclear Science and Technology Organisation (ANSTO). Eighteen samples were selected with the entire program including three individual 1m samples and 15 composite samples of up to 6m, which the company believes are more representative of potential mining intervals for the project.
GRL was also granted a new exploration licence called Cambrai, immediately adjacent to Narraburra, on a three-year term and will soon embark on testing its potential to host northwest extensions of the defined REE mineralisation.
Narraburra has an established resource of 94.9Mt @ 739ppm TREO, including a higher-grade component of 20Mt @ 1,079ppm TREO.
Meanwhile, drill results from the Goodrich, Cyclops and Yeoval East prospects – all part of GRL’s Yeoval project in central-west NSW – confirmed the discovery of near-surface, high-grade copper mineralisation.
The company acquired seven tenements adjacent to its Newman gold project from a subsidiary of Andrew Forrest’s Fortescue (ASX:FMG) during the quarter to consolidate its evolving landholding in the Pilbara.
Post quarter end, PGD picked up another three exploration licences to take its total ground package beyond 1,000km2.
Assay results from last year’s drill program at Newman returned a number of high-grade intersections, including 6m @ 11.54g/t gold from 9-15m at the Tin Can prospect and 1.78m @ 896.52g/t gold from 1.78m at the Peninsula prospect.
Backed by legendary prospector Mark Creasy, who recently increased his holding from 9.66% to 11.6%, PGD also flew an airborne EM survey over its Mallina gold project, also in the Pilbara, to test for conductive sulphides associated with mafic and ultramafic intrusions. It identified anomalies which were coincident with strong magnetic anomalies, strong gravity anomalies and anomalous copper-PGM geochemistry.
Targets have been identified for drill testing and DHEM surveys, subject to heritage surveys and POW approval.
According to the company, results from infill soil sampling at its Pilgangoora North lithium project also strengthened the main central pegmatite soil anomaly and extended the lithium anomaly over a north-south strike length of +1km.
It was another quarter of important milestones of the SHP team and its Ohmgebirge potash project in Germany.
A non-binding MoU was executed with Ohmgebirge neighbour NDH-E/Deusa International for long-term utilisation of the existing Bernterode shaft and associated infrastructure. This delivers SHP a brownfield development pathway with time, cost and footprint advantages compared to a greenfield shaft construction.
Described as a fundamental step for the company, a spatial planning application for Ohmgebirge was submitted to the responsible regulatory authority on 8 December with a decision expected by early June.
SHP also announced plans to raise up to $2.4 million ($1.2 million via an equity placement and $1.2 million from a rights issue which is still progressing) in new funding for a PFS on the base case browfield development pathway for Ohmgebirge.
“Moving into Q1 2024, we are nearing the completion of the Ohmgebirge PFS and look forward to releasing the study in early Q2 2024,” SHP managing director Luis da Silva said.
During the quarter, the company and its Canadian geological contractor Axiom Exploration Group completed an initial ground-based sampling program at the McLaughlin Lake lithium pegmatite project in Manitoba.
Two of the 29 samples collected returned high Li2O grades of 2.77% and 2.25% with the second sample being from a 1.5m continuous grab sample across the pegmatite dyke. It also confirmed a historical channel sample which returned 1.5m @ 1.32% Li2O.
Sampling also highlighted elevated levels of rubidium, caesium, tin and tantalum. The rubidium grades were higher in five of the anomalous caesium samples, reinforcing the company’s theory that the formation of spodumene-bearing pegmatites are more likely in the west section of the 30km east-west striking tenement.
NMR acquired a 51% interest in McLaughlin Lake in August last year and plans to undertake a 3,000km line heli-mag survey and initial diamond drilling programme once a land access agreement has been negotiated with the relevant First Nations groups.
The company is also reviewing airborne geophysics data recently collected from its Palmerville copper project with field work on hold this quarter due to the wet season in North Queensland.
At Stockhead we tell it like it is. While Challenger Exploration, Godolphin Resources, Peregrine Gold, South Harz Potash and Native Mineral Resources are Stockhead advertisers, they did not sponsor this piece.