More high-grade hits on Cue for Musgrave Minerals (ASX:MGV)

Musgrave Minerals is fast approaching its 1 million ounces target for the Cue Gold Project after reporting its latest high-grade gold assay results. Even better, the results come from outside the current Mineral Resource Estimate boundaries as Musgrave develops its pipeline to take the company from explorer to producer.

The resource base at the 100% owned project in the mineral-rich Yilgarn region of WA was in late May upgraded to 927,000 oz of gold, surpassing analyst expectations at that time.

Now the most recent assays show the project still has plenty of exploration upside and strong potential to hit the 1Moz mark by Musgrave’s (ASX:MGV) target date of early 2023.

The results from the Amarillo prospect include 17m at 2.5 grams per tonne (g/t) of gold from 18m, including 2m at 12.7g/t gold from 33m, and 3m at 14.6g/t gold from 60m.

Early-stage drilling north of Amarillo along the Western Trend has additionally identified new near-surface gold occurrences. So far five new targets have been identified and Musgrave believes they may represent dispersed gold halos above a basement source.

Follow-up drilling at these targets has already been planned for this month and the results will be eagerly anticipated: The drilling at Amarillo has to date focused only on the top 120m while two gold lodes with a combined strike length of 400m remain open down dip. The eastern lode is also open to the south.

Adding to optimism at the site is the fact that the new target areas (Western Dolerite) are an extension of the geology that hosts the high-grade West Island gold mineralisation on Musgrave’s joint venture with gold producer Evolution Mining.

Amarillo is also only 1km southwest of the Cue Project’s Break of Day Trend, one of Australia’s highest-grade near-surface, undeveloped gold deposits, with a current resource base of 262,000oz at a whopping 10g/t.

Musgrave Managing Director Rob Waugh said of the Amarillo assays: “The latest results further confirm that our exploration methodology at Cue is very effective.”

“We’re aiming to release the maiden Mineral Resource Estimate (MRE) for Amarillo in early 2023 as we pursue our dual strategy of exploration discovery alongside resource growth and development across the entire Project.”

Growing team

To help define an optimal development path for Cue, Musgrave last month appointed Anthony Buckingham as General Manager-Development.

With a strong track record as a gold project developer and operator, Buckingham will progress prefeasibility studies (PFS) that take in the new deposits and potential future resource upgrades.

Some of the tasks he’s looking forward to this quarter include progressing the prefeasibility level studies at the new Big Sky and White Heat-Mosaic prospects.

After a pre-start visit to Cue Buckingham said: “I’m very excited about joining the Musgrave story – with great people and its growing resources. 2022/23 is a pivotal time for Musgrave and I’m looking forward to being a part of this.”

Multiple targets

Musgrave has an impressive history of discovery and value creation since 100% acquisition of the Project with two gold corridors and multiple regional targets in 2017. It’s also achieved these key goals at well below global greenfield average costs, something that’s been recognised by major broking houses.

Mining industry veteran Waugh has described some of Musgrave’s recent near-surface exploration hits as among the best in WA’s mineral-rich Yilgarn region.

The Yilgarn Craton is a large mineral-rich region around 400km east of Perth that has spawned numerous major mines and has been described as “Australia’s premier gold and nickel province”.

Musgrave’s project is itself surrounded by several major gold mines and processing plants including Westgold Resources’ (ASX:WGX) 1-million-ounce (Moz) Bluebird facility, Ramelius Resources’ (ASX:RMS) 6Moz Mt Magnet gold camp and the 4Moz Big Bell mine.

At Cue, in addition to Break of Day, deposits with significant growth potential include the high-grade Starlight lode, as well as White Heat-Mosaic along the Break of Day trend and the Big Sky discovery just 2km to the south-west.

The White Heat-Mosaic Deposit has a Mineral Resource of 185kt at 11g/t for 65koz of gold and has been drilled to only 120-160km.

Big Sky has been drilled to only 100-160m and has a Mineral Resource of 4.65Mt at 1.2g/t for 173koz of gold.

Another exciting newer target is the Waratah Trend, which has returned 2m at 28.1g/t.

“We’re confident we can continue to expand the Cue Gold Project’s resource base, with all deposits remaining open and exploration drilling continuing to intersect high-grade gold on new targets,” Waugh said.

“Already 47% of the resources across the Project are in the indicated category and we’re confident we can continue to move more resources into the higher confidence categories in the near term.”

Next steps on Cue

Aside from the follow-up drilling at Amarillo this month, an assessment of the depth potential and high-grade plunges within the Big Sky and White Heat-Mosaic deposits is currently underway, which will lead to further drilling.

Drilling to test the very high-grade Break of Day and White Heat-Mosaic deposits has recently been completed. This program is also testing new targets at Mainland, with assay results pending.

Musgrave has also been undertaking “overwhelmingly positive” prefeasibility level studies on Break of Day and the Lena deposit. PFS level studies will commence this quarter at Big Sky and White Heat-Mosaic.

At the Evolution-managed joint venture drilling is also continuing, with more results expected in July.

Musgrave Minerals (asx:mgv)