Special Report: De Grey Mining (ASX:DEG) has boosted total resources at its Mallina Gold Project in the Pilbara by 29 per cent to 2.2 million ounces before the inclusion of its new Hemi, which some observers believe could already contain another 2.8 million ounces.

The resource upgrade — based on drilling done up to the end of 2019 — includes the Withnell open pit and underground (+40 per cent to ~600,000oz), Toweranna open pit and underground (+47 per cent to 524,100oz), together with significant and shallow extensions to the Mallina resource (+91 per cent to 307,400oz).

Importantly, these resources all remain ‘open’ along strike and at depth.

And the upgrade doesn’t include the Mt Berghaus, Wingina, Amanda, Camel, Roe, Dromedary and Calvert deposits, which De Grey says are “unchanged and will be updated after drilling is done at each deposit”.

“Importantly, we have maintained the high average grade of 1.8 g/t, all deposits commence from surface making them readily amenable to open pit mining and all remain open,” says De Grey technical director Andy Beckwith.

“As we have repeatedly stated, our next corporate goal is to achieve +3 million ounces and we strongly believe this will be eclipsed by the end of 2020.”

Hemi is the ‘game changer’

The new Hemi discovery is not included in this resource statement, Beckwith says.

De Grey — one of 2020’s exploration success stories — is up almost 350 per cent this year on the back of its find at the greenfields Hemi prospect.

In late March, Argonaut analyst Matthew Keane estimated that the combined Brolga and Aquila zones at Hemi could already contain 2.8 million ounces. 

“The thickness of mineralisation at Hemi is an order of magnitude larger than our existing deposits which provides an exciting opportunity to significantly grow our resources,” Beckwith says.

“Substantial increases in project economics are anticipated with the inclusion of the Hemi deposit.

“Accordingly, the economic studies will be updated once the scale and resources are defined at Hemi.”

Three rigs are turning at Hemi for the “foreseeable future”, to scope out the extent of this major discovery. The company anticipates defining an initial inferred resource to 400m depth.

The next Hemi results are scheduled for early next week, Beckwith says.



This story was developed in collaboration with De Grey, a Stockhead advertiser at the time of publishing.
This story does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.