Patronus conjures gold and base metals exploration magic with $79m and two-state push

• Patronus’ $79m in cash and liquid investments grants opportunity to take back to basics approach to exploration
• Company operates Cardinia gold project in WA with nearly 1 million ounces at 1.4g/t
• Extensive Pine Creek project in NT offers exploration upside for gold, uranium and base metals

Every resources junior hopes to have that spark of magic that will set them aside from their peers and inspire the market but few have gathered as many of the components needed as Patronus Resources has.

The company, which came about from the merger of Kin Mining and PNX Metals in August, has two principal projects in Western Australia and Northern Territory, an experienced leadership team with a good track record and mix of skills, and something that few others have – a war chest of $79m in cash and liquid investments.

Speaking with Stockhead, Patronus Resources (ASX:PTN) managing director John Ingram said the merger led to a bit of a reset in terms of the company’s strategy that was aided by its strong balance sheet.

“That has really allowed us to – particularly in the NT – get to a back to basics approach from an exploration point of view,” he added.

The company picked up the bulk of its funds back in December 2023 when the then Kin Mining sold the Bruno, Lewis, Kyte and Raeside deposits, which collectively held 610,000oz of gold, to Genesis Minerals (ASX:GMD) for a hefty $53.5m in cash and shares.

And while Patronus has since exited its Genesis position and another investment that paid off in spades, the transactions have left it with a healthy balance sheet that has allowed it progress exploration and corporate activity without having to rattle the tin.

Besides taking a crack at acquiring Matsa Resources (ASX:MAT), the company has picked up a 7.73% stake in Emmerson Resources (ASX:ERM) and secured a 1.96% interest in Brightstar Resources (ASX:BTR) after accepting the latter’s all-share takeover offer for Alto Metals in which it held shares.

Ingram said the company’s investments were made with an eye to value on those opportunities whether through Patronus itself or in terms of the investee company’s approach.

“We’ve got to see logical exit points on any of these investments and we also like to be supportive of any of our investments,” he added.

“We’ve got a pretty good skill set across mining, exploration and the broader corporate and M&A type skill sets, if we can add value and help out companies that we invest in, we’re happy to do that.

“One thing we won’t do, we are not in there for a quick pump and dump on shares. We want to do the right thing by the companies we invest in.”

He added that while the company had done exceptionally well in terms of its investments, its core focus remained in value-adding at the end of the drill bit.

Here’s where the company’s substantial war chest really comes into play, allowing it to fund its exploration efforts into the foreseeable future without having to go to the market.

Leonora gold bounty

This narrative takes us to the company’s Cardinia project within WA’s highly prospective northeastern Goldfields region just 40km from Leonora.

It sits within the Minerie Domain in the central part of the Norseman-Wiluna Greenstone Belt, which extends for about 600km on a north-northwest trend across the Archean Yilgarn Craton.

The project is close to existing infrastructure and third party operations.

Adding interest, it features free milling ore that lends itself to processing using conventional carbon-in-leach operations.

Cardinia already hosts the Mertondale and Cardinia East deposits that have resources of 10.4Mt grading 1.4g/t, or 480,000oz of contained gold, and 10.4Mt at 1.4g/t, or 475,000oz of contained gold, respectively.

Mertondale also features historical production of 274,724oz at an average grade of 4.73g/t and already has mining proposal and access approved while Cardinia East’s mining proposal is well advanced.

“The project itself is pretty exciting. We’ve got nearly a million ounces at about 1.4 g/t grams at Mertondale and Cardinia East, though for all intents and purposes they are part of the same project,” Ingram said.

“Leonora is a great address to be in. You’ve got some of the major players in the Australian gold sector operating there.

“Genesis is just down the road from Leonora, you’ve got Vault Minerals over at King of the Hills. And quite a few sort of up-and-comers that recognise the prospectivity and quality of the old assets in around the Cardinia gold project or the broader Leonora area.”

He added the company was confident there was still significant exploration upside with fieldwork to be carried out this year.

“We’ve got some drill results from some more exploration targets at the north end of Mertondale,” Ingram added.

“The other thing we’ve been progressing this quarter has been a scoping study on developing Cardinia.

“Once we finalise that, we’ll get a better view on how we want to progress this project and potentially monetise it going forward.”

Ingram noted the company was looking at three options, toll treating, building a standalone project or even selling it to one of the other players in the district with an operating mill.

However, he emphasised the company did not have a for sale sign out at this point.

He also flagged that the company was still on the lookout for M&A opportunities within the region.

More recently, follow-up reverse circulation drilling at the Guppy prospect returned results such as 13m at 2.12g/t gold that confirmed the presence of a mineralised gold structure well outside the existing Cardinia East resource.

Chasing giants

However, it is the extensive Pine Creek project within the Northern Territory’s Pine Creek Orogen, which has +20Moz historical gold endowment and is known as a world-class uranium province, that really has Ingram’s pulse racing.

“We do like the exploration upside in WA, but in terms of really sort of blowing an area apart, the recent district-scale sampling we completed at Pine Creek has us really excited,” he said.

“The whole team is chomping at bit to get in there and start drilling next year.”

While the project area already hosts some 283,000oz of gold at the Glencoe, Fountain Head and Mount Porter deposits, the results received to date – which represents 70% of the work – have outlined plenty of potential large-scale targets.

The remaining samples are also expected to deliver more targets while infill sampling is underway to “tighten up” drill targets for 2026.

“We’ve got good relationships with the NT regulators and we’ll just be working through them and getting our approvals in place for the drilling,” Ingram added.

But gold isn’t all there is to find at Pine Creek, the project is also prospective for uranium and VMS style mineralisation.

“We’re still looking at the multi-element chemistry and we’ve also got geophysical data sets, which are helpful particularly on the VMS side of things,” Ingram said.

“Fortunately, the gold exploration is complementary in terms of the techniques that we’ll use – at least initially – for looking for VMS and uranium systems as well.”

Ingram highlighted the Thunderball uranium discovery that was made by Thundelarra in 2009, saying there was a lot of interest in its high grade potential before the 2011 Fukushima disaster took the wind out of the uranium market.

“Obviously there’s now some wind in the sails at the moment on the uranium side,” he added.

“We really like the project and we thought we’d take the opportunity to do some drilling, diamond drilling, which we’ve completed this year, just with a view to de-risking Thunderball.

“We’re looking at getting some results out on Thunderball next week and have also engaged SRK Consulting to do an updated JORC 2012 resource estimate based on both historical and our recent drilling.”

However, he noted that while the company believed the uranium upside was fantastic, it was also outside of its core gold and base metals focus.

“We are looking at ways to progress the project, whether it’s better off in a pure play uranium company that shareholders can still get exposure through,” Ingram said.

“We have enough on our plates with the gold exploration side of things in the NT and WA.”

At Stockhead, we tell it like it is. While Patronus Resources are Stockhead advertisers, they did not sponsor this article.