Kalamazoo puts its foot on Pilbara gold projects; shares surge 157pc
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Kalamazoo Resources shares surged 157 per cent in early Friday trade after the gold explorer bought an option on three Pilbara gold projects.
Kalamazoo (ASX:KZR), which listed in January, saw its share bounce as high as 18c. The shares had cooled to 14.5c by close of trade — up 7.5c.
The Pilbara in north western Australia is undergoing a gold nugget rush as a swag of junior explorers — and individuals — head to the region to search for gold nuggets.
The 90-day option allows Kalamazoo to buy 80 to 100 per cent of the DOM’s Hill Gold, Sisters and Marble Bar Gold Projects from WA resources industry stalwarts Denis O’Meara and Brett Keillor.
Kalamazoo today showed off a selection of nuggets (pictured above) recovered on the land by the seller. The nuggets — between 1cm and 4cm — are not owned by Kalamazoo.
The option cost Kalamazoo $125,000, funded from existing cash and the issue of $200,000 in new shares.
Kalamazoo (ASX:KZR) name dropped shamelessly in its announcement, claiming proximity to projects worked by Novo Resources and Artemis (ASX:ARV), De Grey Mining (ASX:DEG), Venturex Resources (ASX:VXR), Impact Minerals (ASX:IPT), DGO Gold (ASX:DGO) and Calidus (ASX:CAI).
Kalamazoo chairman Luke Reinehr said the deal “propels Kalamazoo into the Pilbara” as an explorer.
Mr Reinehr told Stockhead there was no need to raise capital to pay for either the option or further exploration.
The company cautioned that prior exploration results for the tenements were not done in accordance with industry standard JORC code 2012.
JORC compliance refers to the mining industry’s code for reporting exploration results, mineral resources and ore reserves, managed by the Australasian Joint Ore Reserves Committee.
“It is possible that following further evaluation and/or exploration work that the confidence in the prior reported exploration results may be reduced when reported under the JORC Code 2012,” it said
However, Kalamazoo had no reason to question the seller’s results.
Mr Reinehr says he was “very comfortable” with the existing data, but given it was a strategic investment, Kalamazoo had to do more work to satisfy shareholders.
Kalamazoo was very well positioned as local and global companies cast their eye over the Pilbara, he said.
Kalamazoo said Mr O’Meara’s and Mr Keilor’s companies had found up to 300 ounces of gold nuggets in the Dom Hill zone.