Special Report: Market conditions appear ripe for the float of Metal Hawk Limited, a new exploration company with a portfolio of exciting gold and nickel projects in prime Western Australian locations and the backing of some of the most well-regarded geologists in the country.

Metal Hawk lodged the prospectus for its initial public offering with the Australian Securities and Investments Commission on Tuesday, with the Australian dollar gold price sitting at a near-record level, the nickel price hovering around a five-year high and the outlook for both commodities positive.

The company is seeking to raise up to $5.5 million through the IPO, with the funds earmarked for exploration on its assets in the WA goldfields and to the south, in the Fraser Range.

“We see a big future in nickel with the rise of electric vehicles and current supply restrictions in Indonesia (the world’s largest nickel producer), and you can’t ignore the current AUD gold price,” managing director Will Belbin told Stockhead.

“Some of the targets we have sitting there ready to drill are the kind that any of the major gold and nickel operators in the region would be excited about testing. The feedback we have received from industry participants and investors so far has been really strong, and we’re excited to get out on the ground drilling in November.”

Should the full amount be raised in the IPO, Metal Hawk will begin trading with a modest enterprise value of $3.2 million, meaning it will be heavily leveraged to exploration success on any of its projects.

 

Key projects underexplored

The company’s flagship asset is Kanowna East located 30km north-east of Kalgoorlie. Importantly, it is just 8km from Northern Star Resources’ Kanowna Belle gold mine and 10km south of, and directly along strike from, Poseidon Nickel’s Silver Swan nickel deposit and operating infrastructure.

Despite being surrounded by world-class gold and nickel deposits, Kanowna East has seen little historic exploration due, Belbin says, to the stifling effects of corporate takeover activity and tricky joint venture ownership.

The last work done on the ground was shallow aircore drilling by LionOre International in 2005, which produced encouraging and economic intersections of both gold and nickel. But these were never followed up as LionOre was swallowed by Norilsk Nickel soon after.

Belbin tells the story of the individual who vended Kanowna East into Metal Hawk pegging it just 20 minutes before competing applications came in from majors in the region, giving some indication of how the project’s potential is viewed.

Metal Hawk plans to conduct more aircore drilling at Kanowna East and employ ground electromagnetics to better define deeper basement targets for follow-up drilling early next year.

More immediate drill targets lie in wait at the company’s Emu Lake and Clinker Hill projects in the goldfields, both of which are also prospective for gold and nickel.

Aircore drilling to test two significant geochemical anomalies for bedrock-hosted gold is planned to commence at Emu Lake in November, while a “compelling” electromagnetic target at Clinker Hill will be tested with diamond drilling early next year with the hope of encountering nickel sulphides.

Metal Hawk executive director David Pennock (left) and managing director Will Belbin at the company’s flagship Kanowna East project in the West Australian goldfields. (Supplied)

The Newexco Connection

Clinker Hill is one of two projects (the other being Fraser South in the Fraser Range) vended in to Metal Hawk by Adrian Black and Bill Amann, who are the well-regarded and successful duo behind geological consultancy Newexco Services.

Newexco has had a major hand in several of WA’s best mineral discoveries over the past few decades including Western Areas’ Flying Fox and Spotted Quoll nickel deposits, Sirius Resources’ Nova-Bollinger nickel-copper deposit and the Monty copper-gold deposit now owned by Sandfire Resources.

Belbin’s previous job was exploration manager at Rox Resources, where he was responsible for the discovery and drill out of the Fisher East nickel province in WA’s northern goldfields.

Prior to joining Rox in 2011, he had two stints under the tutelage of Black and Amann at Newexco.

“Adrian and Bill are complete professionals who do things properly and because of that they don’t miss any opportunities,” Belbin said. “They are also passionate explorers and their passion has certainly rubbed off on me.

“Having Newexco as key advisors and consultants to Metal Hawk will hold us in good stead with our exciting nickel targets.

“They are very excited by Metal Hawk and the prospect of seeing the next big discovery.”

 

Joint venture eases load

The most recent asset to be added to the Metal Hawk portfolio – and probably most advanced – is the Viking gold project in the Fraser Range, which was pegged in April and has since been the subject of a joint venture agreement with Chalice Gold Mines (CHN).

Chalice, which will manage the joint venture, has the right to earn up to 70% of Viking by spending $2.75 million on exploration over 4.5 years.

Viking lies along the western edge of the highly prospective Albany-Fraser Orogen and along strike from the Tropicana Gold Mine owned by AngloGold Ashanti and Independence Group.

High grade gold has been intercepted at two prospects within the project, Beaker 2 and Beaker 4, but drilling to date has mostly only been shallow.

The thinking behind bringing in a partner with deeper pockets on Viking is it will enable Metal Hawk to focus on its earlier stage projects where exploration is not as costly yet the potential to create value through discovery remains significant.

Just to add to the credentials of the Metal Hawk team, Brett Lambert, chairman of another company well versed in WA nickel and gold exploration, Mincor Resources, will serve as its chairman.

Co-founder David Pennock, a qualified geologist with more than 12 years’ experience in the resources sector, rounds out the board as executive director.

Metal Hawk is expected to list on the ASX in early December.

Cannacord Genuity (Australia) Limited is lead manager for the IPO.

 

This story was developed in collaboration with Metal Hawk, 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.

 

 

 

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