Barry FitzGerald: Navarre goes back to the future in return to Victorian gold strategy

“Garimpeiro” columnist Barry FitzGerald has covered the resources industry for 35 years. Now he’s sharing the benefits of his experience with Stockhead readers.

Being an optimistic type would seem to be a prerequisite for investing in ASX-listed junior explorers.

Garimpeiro for one is not short of optimism, something he traces back to his summer holidays as a young lad in the empty dress circle of the then crumbling Regent Theatre in Melbourne’s Collins Street.

His mum was an usherette at the picture palace and the young Garimpeiro had the dress circle all to himself to take in not particularly appropriate films like The Good, the Bad and the Ugly and Tony Rome.

But then there was kids’ film Chitty Chitty Bang Bang, which Garimpeiro must have watched more than 50 times. It is one of the film’s songs – The Roses of Success – that Garimpeiro reckons is responsible for his enduring optimistic view on things.

The song’s refrain – “Up from the ashes, up from the ashes, grow the roses of success” – has stuck to this day.

Funny thing is Garimpeiro started to hum the refrain during the week at Melbourne’s Kelvin Club when James Gurry took his turn to make a presentation to the Stawell Gold conference hosted by Arete Capital Partners.

Gurry, a former equity research analyst with Deutsche and Credit Suisse, is executive chairman and managing director of Navarre Minerals (ASX:NML) or more simply, he is the guy that got the company out of administration and back on to the ASX lists as a focussed Victorian gold explorer.

Navarre: An abridged history

Navarre originally listed on the ASX in a $5 million float in 2011 as just that. And it was successful at doing just that, with its market cap peaking at around $156m in 2020.

But then there was a rush of blood to the head by previous management with the 2021 acquisition of the Mt Carlton gold mine in north Queensland. It was a disaster, and Navarre went into administration in June last year.

Mt Carlton is now gone from the company and to continue the cinematic theme, it is back to the future for Navarre as a debt-free Victorian gold explorer with a tight capital base of 102.4 million shares as a result of a 500:1 share consolidation.

It is to be rebadged soon as Aureka with the ASX code of AKA.

At Friday’s market price of 10c a share it has a market cap of $10.2m. AKA has $5.7m in cash after recently raising $6m (bids for $9m were received) from new and existing shareholders.

More than 300 existing shareholders took part in the raising, which says something about their optimism on the Victorian projects.

The biggest shareholder in the new look Navarre with a fresh 9.8% holding is Allan Myers’ Dunkeld Pastoral. The rich-lister barrister and pastoralist was raised in Dunkeld, a town at the southern end of the Grampians and an hours’ drive from Stawell.

Stawell gives its name to the geological Stawell Corridor, which over time has yielded more than 6moz of gold. That’s mostly from the privately owned Stawell gold mine, which is managed by Arete, a private equity and mine management company.

Navarre’s projects are mostly in the Stawell Corridor, including its flagship Irvine project near the Stawell mine. Irvine has a 304,000oz gold resource grading 2.43g/t as well as an “exploration target” of 280,000-420,000oz at 2-3g/t.

That’s interesting in itself for a company with a $10.2m market cap and with the cash to chase down the upside implied by the exploration target.

The same could be said for the Tandarra project over in the Bendigo zone, with Navarre holding 49% of a joint venture with Catalyst Metals (ASX:CYL)

Navarre plans to have drilling rigs whirring away at both projects in coming weeks.

All up, it is planning for a 7000m continuous drilling program across its key projects over the coming 12-15 months, including more drilling at the high-grade Tandarra. So newsflow is going to be as good as it gets for a $10.2m explorer.

The views, information, or opinions expressed in this article are solely those of the columnist and do not represent the views of Stockhead. Stockhead does not provide, endorse or otherwise assume responsibility for any financial product advice contained in this article.