• Spartan Resources to raise $25m to grow the high-grade 721,200oz Never Never discovery at Dalgaranga gold project
  • Funds will also be used for a feasibility study on project restart
  • Resource update expected in December 2023


Special Report: Spartan Resources has received firm commitments to raise A$25 million via a placement at A$0.40 per share to pursue a rapid pathway back to production at its Dalgaranga gold project in WA.

Dalgaranga produced over 70,000oz of gold in FY2022 before being placed on care and maintenance in November 2022 to implement an operational reset, designed to preserve the value of its extensive infrastructure and resource base while developing a new, sustainable operating plan.

This approach is underpinned by the high-grade Never Never gold discovery, made in early 2022 just 1km from the existing 2.5Mtpa carbon-in-leach processing facility and the main open pit at Dalgaranga.

Spartan Resources (ASX:SPR) has moved to rapidly unlock the potential of Never Never, which comprises a current resource of 721,200oz at an average grade of 5.85g/t – and where earlier this week they reported a massive drill hit of 1,093g/t gold.

Investors have responded in kind, sending the stock from 11c to 42c since March – an impressive 280% gain amidst what has been a tough year generally for gold mining and exploration companies.


Resource growth the plan

Proceeds from the placement will to be used to underpin an expanded exploration campaign at Dalgaranga in 2024, including:

  • Drilling out Never Never Deeps and growing the high-grade resource beyond the resource estimate update (scheduled for December 2023);
  • Drilling out multiple new high-grade discoveries immediately along strike including Four Pillars, West Winds, Arc and Ink to bring them into the resource; and
  • Completing a feasibility study on a fully integrated restart of the Dalgaranga project.

“We are very pleased with the level of support shown by well-credentialed resource investors for the placement, with the strong demand received, representing a clear endorsement of Spartan’s high-grade growth strategy,” MD and CEO Simon Lawson said.

“The proceeds of this placement, combined with existing cash reserves, will put Spartan in an outstanding position to capitalise on what has been an exceptional year for the company in 2023 and significantly up-scale our exploration and resource drilling efforts in the first half of 2024.

“The funds raised will be earmarked to delivering resource growth above the scheduled mineral resource estimate update in December 2023, targeting the next leg of resource growth at Dalgaranga and ensuring we can maintain our current exploration momentum.

“The Spartan board has approved a significant increase in our exploration activities on site with the placement designed to ensure Spartan’s balance sheet strength and flexibility is maintained while funds are committed to advancing the Dalgaranga gold project.”


Expanding the Never Never footprint

In February, the company rolled out an 18-month exploration and strategic plan targeting a +300koz reserve at a grade exceeding 4g/t gold at Never Never, a +600koz resource at a grade exceeding 5g/t gold at Never Never, plus the development of a 5-year mine plan aimed at delivering gold production of 130-150koz per annum.

This strategy is centred around an aggressive exploration program at Never Never designed to target resource expansion, reserve definition and near-mine exploration drilling targeting Never Never ‘lookalikes’.

“The Spartan team is committed to ensuring a thorough and detailed approach is taken to the delineation of the Never Never orebody and the surrounding targets,” Lawson said.

“Spartan is focused on expanding the Never Never footprint with the most recent results hitting broad mineralisation more than 500m from surface.”

In addition to its near-mine exploration at Dalgaranga, the company is actively exploring more than 500km2 of surrounding exploration tenements and also owns the advanced Yalgoo gold project with a resource of 244koz, where permitting activities are well advanced to establish a potential satellite mining operation at the Melville deposit.

Spartan is also confident its advanced exploration and development project at Glenburgh–Mt Egerton (which has a combined 527koz resource), ~300km north of Dalgaranga, has the potential to be a second production hub.



This article was developed in collaboration with Spartan Resources, 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.