Gina Rinehart-backed Catalyst Metals has doubled in price since Barry FitzGerald last wrote about it in his Garimpeiro column.

The saying that money begets money is holding true for Australia’s richest woman Gina Rinehart.

And it has nothing to do with her Pilbara iron ore interests.

This time it is about finding a “new’’ Bendigo goldfield in Victoria.

Ms Rinehart’s Hancock Prospecting has spent $4.2 million in recent years earning a 50 per cent interest in the Four Eagles gold project north of Bendigo in a joint venture led by ASX-listed Catalyst Metals (ASX:CYL).

Four Eagles is not Catalyst’s only Victorian gold interest. But a rough rule of thumb would be that its half interest accounts for 75 per cent or $60 million of its current market value of $80 million — implying a $60 million value for Ms Rinehart’s interest.

That’s a handy gain in anyone’s language on the money invested in the joint venture and because of the valuation method, necessarily reflects Catalyst’s strong share price performance since it was first mentioned here last August when it was trading at 56c.

Catalyst is now a $1.15 stock, with the share price gain reflecting the hope that the company’s dominant ground position to the north of Bendigo – the “old’’ goldfield produced 22m ozs of gold in its heyday – contains another big deposit.

Catalyst Metals shares (ASX:CYL) over the past year.
Catalyst Metals shares (ASX:CYL) over the past year.

Work to date by Catalyst in the joint venture with Hancock Prospecting, and in a separate joint with Navarre Minerals (ASX:NML) at the Tandarra project, have continued to provide encouragement on that front.

The question is whether the big discovery is made this year, next year, or ten year’s time.

The sort of deposit Catalyst is after can be a complicated thing requiring a lot of drilling to understand.

That’s what Catalyst has been doing along the Whitelaw Belt, a prospective zone some 75km long and 5-10km wide which runs to the north under younger Murray Basin sediments from the old out-cropping Bendigo goldfield.

Four Eagles and Tandarra, 55km and 40km north of Bendigo respectively, have already generated gold discoveries but drilling has generally been limited to 50-100m.

The results have been impressive enough to attract the attention of one of Australia’s sharpest gold producers, St Barbara.

It recently increased its equity stake in Catalyst to 16 per cent by taking up a $5 million placement of shares.

St Barbara’s equity stake is in keeping with its strategy in juniors with advanced gold projects with promise to give it future potential growth options.

While Catalyst’s shallow gold discoveries are interesting enough, it is the potential for the discovery of deeper Bendigo and Fosterville-type multiple “stacked” shallow-plunging gold lodes which has fired up interest in the group’s exploration effort.

On that score, drilling at both Four Eagles and Tandarra have given some recent encouragement.

Catalyst is drilling at Four Eagles at the moment with four rigs on the job.

The drilling program was delayed while a 10-year retention licence on the property was secured with the Victorian government but is now in full swing.

So look out for a ton of results from the program over the next couple of months before the weather sets in.

Drilling is now been wrapped up at Tandarra and there are some remaining assays to be reported.

Drilling there has extended the shallow zone 250m to south, as well as yielding the first drill intersection suggesting that the Bendigo-style “stacked’’ model is appropriate.

The grade of the 31m intersection from 261m was not flash at 0.7g/tonne but it did include a 1m interval grading 8.5g/tonne.