PNX Metals has added another highly prospective gold project to its portfolio that is located just trucking distance from its Fountain Head and Hayes Creek zinc-gold-silver development and advances the company’s strategy of building scale in the Northern Territory.  

PNX Metals (ASX:PNX) is acquiring the Mt Porter deposit from Ausgold Trading which will boost the company’s gold resource inventory to over 0.5Moz.

The increased gold resource is part of an already substantial war chest that also includes 16.2Moz of silver, 177,000 tonnes of zinc, 37,000 tonnes of lead and 10,000 tonnes of copper.

This follows close on the heels of an updated resource for the Glencoe gold deposit, which PNX picked up in December 2020.

The company will acquire the Mt Porter deposit for an upfront consideration of $1.05m to be settled via a mix of cash and PNX shares.

PNX has been strategically acquiring ‘bolt-on’ assets with exploration upside that support the development of its Fountain Head project as a regional processing hub.

Managing director James Fox says the Mt Porter deposit is near-surface, can be mined via open-pit, and will integrate well with the proposed development plans at the Fountain Head gold and Hayes Creek zinc-gold-silver projects.

“The upfront cost of the gold ounces at Mt Porter is below the market average taking into account the high confidence, with 84% in the Indicated category, and highly prospective exploration targets which exist along strike and have the potential to provide additional scale to future operations,” he said.

There aren’t a lot of mining projects being built in the Top End, with the NT EPA register showing just six mining projects currently undertaking an environmental impact assessment (EIS). Two of those – Fountain Head and Hayes Creek – belong to PNX.

And just eight mining projects have received approval by the NT EPA under an EIS over the last five years.

Location, location, location

Mt Porter sits 50km south-east of where PNX plans to build the Fountain Head processing plant and is accessible via the existing Mt Wells Road, enabling the ore to be easily trucked back to the plant for processing.

The deposit currently has a defined resource of 681,000 tonnes at 2.2 grams per tonne (g/t) for 48,200 contained gold ounces in the Indicated (84%) and Inferred categories.

Metallurgical testwork undertaken in 2017 demonstrated that gold from the Mt Porter ore could successfully be recovered via a standard carbon-in-leach process, which is what PNX plans to use at its Fountain Head project.

This testwork showed a CIL plant could recover 92.5% of the gold from oxide ores, 85.7% from transitional ores and 79.7% from fresh ores.

PNX has also identified strong exploration upside along a 1.2km strike that has returned numerous high-grade intercepts outside of the existing resource, with top hits including 8m at 8.38g/t gold from 54m at Mt Porter North and 9m at 1.55g/t from just 2m at Mt Porter South.

The Mt Porter deposit remains open along strike and to the west where a previously unknown zone of gold mineralisation of 13m at 3.53g/t from 71m was located 20m west of and 30m deeper than the current mineral resource. This zone was not intersected in any holes previously drilled into the western side of the Mt Porter deposit and remains an area of significant exploration potential.

The company will update the existing mine management plan and subject to approvals will undertake field work in readiness to test walk-up exploration targets.

PNX’s larger plan is to mine and process ore from three wholly owned gold deposits – Fountain Head, Glencoe, and Mt Porter – and two wholly owned zinc-gold-silver deposits – Mt Bonnie and Iron Blow. All five of the deposits are located on granted mining leases.

A prefeasibility study on the Fountain Head gold and Hayes Creek gold-silver-zinc projects completed mid-2021 highlighted a robust, multi-commodity, two-stage mine development that would have an initial mine life of 10 years, a pre-tax net present value (NPV) of $171m and a pre-tax internal rate of return (IRR) of 63%. This was excluding the upgrade to Glencoe, and excludes Mt Porter.

PNX is very close to securing environmental approval for the stage one development of the Fountain Head project which is expected to be received later this year.




This article was developed in collaboration with PNX Metals, a Stockhead advertiser at the time of publishing.


This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.