Red Mountain to acquire gold project in hot region
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Special Report: Red Mountain is acquiring a project in Western Australia’s prolific Murchison region that has historical gold production.
The 62sqkm Mt Maitland project was discovered in 1898 and produced gold at an average grade of 19.3 grams per tonne (g/t) gold, well above the 5g/t mark that is considered to be high-grade.
Red Mountain Mining (ASX:RMX) says that exploration since then has indicated that the 19km of Archean greenstone belts within the project have the potential to host a significant gold mineralising system.
Surface geochemical sampling and limited sub-surface drill testing identified several prospects along two major regional structures.
The most recent work was carried out by Talisman Mines in 2011 with drilling at the Mt Maitland South prospect including 12m at 1.58g/t gold from 8m including 2m at 6.35g/t gold and 13m at 2.53 g/t gold.
The central portion of the eastern structure is marked by a linear succession of old gold shows worked since the late 1800’s. These include Maitland North, Lenanphyl, Muddawerrie and Second Chance.
Red Mountain added that gold-in-soil anomalies extend over 13km, demonstrating the potential scale and extent of the gold mineralising system.
On the western structure, historical exploration has identified extensive high grade copper-gold anomalism from rockchip and channel sampling which remains to be followed up.
The company noted that while the majority of the project remains untested by drilling, work to date has identified nine walk-up drill prospects.
Mt Maitland is about 51km from Westgold Resources’ (ASX:WGX) Fortnum gold mining operations that could potentially support toll treating and 90km north from Meekatharra.
The acquisition comes a week after the company applied for three tenements that will comprise the prospective 657sqkm Koonenberry gold project in north-western NSW.
Red Mountain will pay a $50,000 exclusivity fee to conduct due diligence over the project for a 21 day period.
This will include rock chip sampling across several of the prospects and a comprehensive review of historical production and exploration data.
Should this prove satisfactory, the company can acquire the project by paying $250,000