Lefroy (ASX:LEX) — led by former Newmont senior exploration manager Wade Johnson — has methodically explored its ground around Kalgoorlie for a few years now.

In February this year, the potential game changer arrived.

A 22-hole drilling program, designed to test both length and depth of the ‘Burns’ system, appeared to hit the motherlode.

The highlight intercept was:

  • 60m at 5.22g/t gold and 0.38 per cent copper from 112m down-hole, including
  • 20m at 12.2g/t gold, 0.87 per cent copper and 1.7g/t silver from 144m.

Gigantic. The stock rerated, massively.

But follow-up diamond drilling by Lefroy – which twinned the discovery hole – failed to replicate those eye watering grades.

Why? There are reasons, which Johnson goes into below. But the most important thing, right now, is that this is a large and exciting copper gold system no one can quite pin down.

“Is it IOCG? Is it porphyry? Is this something completely new in the eastern goldfields of WA that people had never seen before? Is this a gamechanger?” Johnson says.

“We don’t yet know yet.”

 

Start with a background of the Burns tenement itself. What did you see in it initially?

“I used to work for [major gold miner] Newmont, which recognised an intriguing gravity magnetic anomaly in that area in about 2006,” Johnson says.

“Newmont acquired the ground through joint venture, and then explored the area between 2008 and 2009-2010.

“They drilled some aircore holes, did some geophysical work, and drilled one diamond hole in the area, but they had not actually found the Burns anomaly.

“I remember because it was my team doing the drilling.

“Then, through project fatigue, Newmont said ‘we’ve given it a crack, nothing there, let’s sell it’.

“In 2010 they sold it to a company called Octagonal Resources, which did an IPO, raised some money, and then explored the area between 2011 to about 2016.

“They discovered the Burns anomaly.

“They got some good, very interesting copper gold numbers [like 55m at 0.5g/t gold and 0.2% copper from 230m].

“I was still following it at this time because I was intrigued by this system.

“I was fortunate enough to look at one of the core holes that Octagonal has drilled in a core yard in Kalgoorlie.

“It had this fascinating copper gold metal association, different rock types. It was geologically intriguing – what is this system and why does it have so much copper in it?

“Octagonal dropped the ground in 2019.

We put an application in, our application won, we got it granted and were drilling in January this year.

“We made the discovery in February.”

 

So, this was a target you had an eye on for over a decade?

“Easy 10 years,” Johnson says.

“Newmont probably drilled holes about 2km away [from Burns], got a sniff of gold – and that was it, they walked away.

“Then Octagonal came in and made the discovery of the copper gold system at Burns.

“Then, through project fatigue, they dropped the tenement, and we were there waiting.”

 

Those first assay numbers were spectacular, which is what caused the stock to re-rate in February. What did that initial drilling tell you about the Burns system?

“Our discovery hole was 60m at 5.2g/t gold and 0.4% copper from 112m. It was a fantastic intersection,” Johnson says.

“Then we did subsequent resampling, and it came down to 38m at 7.63g/t gold plus 0.5% copper.

“It was all a bit of shock.

“What have we found? What is this system? Because looking at the chip trays, at the geology from the RC drilling there was nothing exciting – it wasn’t a typical orogenic gold system.

“That led us to go ‘right, we need to understand more about this system’. So, we put a diamond hole down, right next to the discovery hole.”

 

And results from that hole weren’t as spectacular as the RC drilling. Why?

“The discovery hole was an RC hole. It’s dry and big diameter – 5-3/4 inch – so you are getting a lot of rock to sample from,” Johnson says.

“The [diamond] core hole 5-10m away is much smaller, significantly smaller, and you drill wet.

“You have a bias between the sample sizes immediately.

Difference between the RC and diamond drill bit sizes.

“The other thing we recognised is that this is not a homogenous [uniform] orebody where mineralisation is just sprinkled evenly.

“We know it is blebby [blobby], we know it is veinlike.

“You could drill in one spot and hit it, drill over there and miss it. We know about this geological variability.

“The other thing we learnt is that this very fine gold – it floats on the water [see image above]. We also get chalcocite – a copper mineral – in the drilling, which is a very fine sooty material.

“When you are drilling wet there is potential to wash out that fine material.

“There will be variances in the grade due to those factors.”

 

You’re saying these ‘blobs’ of mineralisation are easy to miss with diamond drilling?

“It’s not disseminated and evenly sprinkled around like salt and pepper – this is a bleb here, a bleb there and bleb over there.”

 

You also mention the ‘porphyry style’ in a lot of your announcements. When people think of porphyry, they think Cadia. Is that what you are talking about or is there another analogue you are working with?

“A big part of our work now is to determine what the system is. That the exciting part,” Johnson says.

“It’s a porphyritic rock that has copper and gold in it, and silver, and molybdenum, but we have not pigeonholed it into a specific deposit type.

“Is it IOCG? Is it porphyry? Is this something completely new in the eastern goldfields of WA that people had never seen before? Is this a gamechanger?

“We don’t yet know yet.

“We are doing a lot of research on now with the University of WA; GSWA [Geological Survey of WA] is looking at the data as well.”

 

That’s your wheelhouse as a geologist.

“Absolutely. Having worked in the industry for over 35 years it’s not often you come across something that makes you ask – ‘what is this?’”

 

What are the next steps?

“We have drilled this this discovery section — we call it the baseline section – at Burns and learnt a lot about it in the process,” Johnson says.

“We are now applying that geological information to the rest of the area.

“We believe Burns is subset of a much greater [mineralised] corridor.

“We can see that in the geophysical data. We think this system, this style of mineralisation, could extend for another 4-5km.”

Image showing the extent of Lake Randall, Burns Prospect, the interpreted position of the Burns Intrusion and the geophysical target to the north of Burns.

 

Do you think by the end of the year you will have a better sense of what you are dealing with here?

“Definitely, yes. We are gearing up for more drilling at Burns this year.”

At Stockhead, we tell it like it is. While Lefroy is a Stockhead advertiser, it did not sponsor this article.

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