Lefroy in pole position with large landholding as deals (and the gold price) take off
Special Report: Lefroy Exploration has built up a pretty valuable portfolio of gold projects in WA’s most fertile gold region.
The company has 600sqkm of under-explored ground just 50km from Australia’s gold capital of Kalgoorlie, WA.
The project has been divided into two parts – Western Lefroy and Eastern Lefroy.
The company’s immediate neighbours include some pretty large gold mines.
On one side is Gold Fields’ St Ives operation, and on the other, Silver Lake Resources’ (ASX:SLR) Mt Monger gold operation.
And activity in WA’s gold space is hotting up, with Silver Lake just this week making a takeover play for Egan Street Resources (ASX:EGA) at a nearly 30 per cent premium.
Lefroy managing director Wade Johnson said the company was able to capitalise during the gold price downturn when some mining companies left the area and relinquished ground.
“We maintained a close watch on the area and when every other company dropped ground back in 2013, 2014 and 2015 we would peg it,” he said.
Also in the vicinity of Lefroy’s big landholding is one of the “richest and most prolific gold veins ever found” — at the Beta Hunt underground mine.
Late last year the Canadian owner, RNC, unearthed more than 9000 oz of gold from about 500m underground. A haul worth about $16m at the time and nearly $19m now at the current high gold price of over $2,060 an oz.
RNC was actually in the process of selling the mine, but the massive new find prompted the cashed-up company to hit pause on that process and instead undertake an aggressive exploration campaign beneath Lake Lefroy on its lease holding.
The company has since uncovered even more gold at Beta Hunt as well as bought Westgold Resources’ (ASX:WGX) Higginsville mine in WA for $50m to integrate the two operations.
Lefroy also has ground over Lake Lefroy – which is being taken care of by its major partner Gold Fields as part of a $25m farm-in deal.
This leaves Lefroy free to continue exploration on the less risky and less expensive land part of the project, named Eastern Lefroy, which significantly increases and accelerates the junior’s chances of making two big discoveries at the same time.
The company plans to start a new round of drilling in Augustto test potential extensions to gold mineralisation at its Lucky Strike prospect, where it recently defined a large mineralised gold trend coincident with a gravity anomaly.
All the signs point to it being a major structural trend that could be traced over a 3km strike length to the southeast.