The junior explorer ‘cracking the code’ to the next Fosterville

Special Report: There is no better recipe for success than to have the same crew that once operated one of the biggest Victorian gold mines proving up ground in an extension of a multi-million-ounce goldfield right next to the state’s newest iconic mine, Fosterville.

Before Fosterville, just east of Bendigo, came into production and claimed the title of Victoria’s largest gold mine, the 4-million-ounce Stawell mine was the state’s premier gold producer until 2008..

Now two of the key people that were part of the discovery and operation of the Stawell mine are hoping to drive junior explorer Navarre Minerals (ASX:NML) to the same success.

Navarre managing director Geoff McDermott and chairman Kevin Wilson both worked for the various companies that owned Stawell Gold Mines over the years..

McDermott has over 30 years of experience working as a geologist in surface and underground mines and has worked for other major companies like Western Mining Corp. and Rio Tinto (ASX:RIO).

Wilson, meanwhile, has held a number of senior roles in resource heavyweights such as Anglo American and as a stockbroking analyst and investment banker with CS First Boston and Merrill Lynch in Australia and USA. Wilson was previously Managing Director of Leviathan Resources Limited who owned and operated the Stawell Gold Mine from IPO in 2004 through to its sale in 2006.

Navarre also recently attracted the same man that led the growth of the world-class Fosterville mine, Ian Holland, in his role as vice president Australian operations for mine owner Kirkland Lake Gold (ASX:KLA).

Holland, now a director of Navarre, was also previously the general manager of Fosterville for a number of years and held positions with Mount Isa Mines, Mount Gordon and Renison.

This means the Navarre team knows exactly what it is looking for in the fertile Victorian goldfields and is already witnessing early signs it could be onto another Stawell or Fosterville.

“We know the ground intimately in Victoria and we know most of the gold is controlled by large west-dipping faults that act as plumbing systems to bring gold-bearing fluids from deep in the crust towards the surface,” McDermott told Stockhead.

“We recognised early on that the Geological Survey of Victoria had done some great work demonstrating the importance of these regional faults, so we went about picking up some fantastic ground north of Victoria’s largest goldfield, the 22 million ounce Bendigo Goldfield.”

Navarre has also picked up ground in the Stawell gold corridor, just south and not far from the Stawell gold mine, as well as ground near the Ballarat Gold Mine.

Navarre’s landholding in Victoria. Pic: Supplied

“These are areas that we didn’t have access to previously,” McDermott explained.

“When we were running Stawell Gold Mines, the ground south of Stawell containing the historical Ararat Goldfield, was owned by another company, and fortuitously just a few years after we listed Navarre on the ASX the ground became available.

“So, we pegged it and we haven’t looked back in terms of applying our knowledge of the Stawell geology to finding gold underneath the old Ararat Goldfield.”

Cashed up and laser focused

With the gold price at record levels, there is no shortage of investor interest in quality gold stocks.

Since March 2020, Navarre’s shares have more than doubled to trade at around 12.5c.

Navarre Minerals (ASX:NML) share price chart

This strong investor interest means that Navarre is now in the best financial cash position it’s ever been, with $13m in the bank.

This has enabled the company to plan and bulk up its people and resources as it prepares for a drilling blitz in the Victorian goldfields.

Navarre will have four drilling rigs on the ground by October from one currently, and is recruiting additional people, with the main focus on testing Irvine’s Resolution Lode prospect at the flagship Stawell Corridor Gold Project.

The company is undertaking step-out drilling to pave the way for an initial mineral resource for the Resolution Lode early next year.

Cracking the code

“I think we’ve cracked the code on what’s controlling the mineralisation and its plunge direction. We are progressively stepping our drilling southwards, building what we hope will be our maiden mineral resource in the first quarter of next year,” McDermott said.

McDermott describes its Stawell Corridor ground as “like an iceberg”.

“You search for the tip of the iceberg but 90 per cent of the gold sits below the surface,” he explained.

“So, finding the surface footprint is key, then working out what direction the mineralisation plunges and then tracking it down plunge with step-out drilling. We know from Stawell that the bulk of economic gold mineralisation usually occurs in sediments located up to 100m off a central basalt core. This basalt is very dense and we use geophysics to locate it, cutting down the search time.”

McDermott says Navarre will be going “full guns blazing” this year and the company is making sure it has the equipment and resources to support it.

“We are focused on delivering our maiden mineral resource at Resolution Lode, so we’re drilling there,” McDermott said. “We’re going to be also drilling at Adventure Lode, which is a sister gold system just 4km south of Resolution Lode on the eastern flank of the Irvine basalt dome.

“We’ve got work also planned for the next major basalt dome, 40km south of Stawell and 20km south of Irvine, called Langi Logan. We plan to be drilling there by the end of the year.

“We have geophysics crews ready to mobilise to Jubilee in the next two weeks. Jubilee is one of our new projects near Ballarat. Mapping and geophysics will inform our planning decisions prior to commencing first drilling in the December quarter.”

McDermott said Jubilee was showing early similarities to Fosterville.

Historically mined gold-bearing quartz reefs, exposed at surface and mined up to 600m below surface, bear similar geometries to Fosterville’s Eagle-Swan orebodies. Since mine closure in 1913 there has never been any drilling.

The silver lining

Navarre is also planning exploration at its St Arnaud project, 80km north of Stawell, where it is chasing the northern extension of the goldfield under younger Murray Basin cover. And there’s an added bonus.

“Our first program of drilling returned potential economic levels of gold and silver in all four drill traverses,” McDermott said.

“So, we’re very keen to go back and follow that up.”

Silver is running hot at the moment as the price hits multi-year highs.

Working around COVID-19

While metropolitan Victoria is in stage four lockdown, regional Victoria isn’t facing the same harsh restrictions.

Navarre has secured the drill rigs and personnel it needs ahead of time and has positioned itself to continue fast-tracking exploration through COVID-19.

“Victoria is experiencing a huge land grab with everyone looking for the next Fosterville. Many new entrants have joined the hunt for Victoria’s next gold deposit and COVID-19 State border restrictions are impeding free movement of skilled personnel.

“To be successful, you need the ground and resources – the drill rigs and the people. We’ve been very active in this area – recruiting skilled people and lining-up our drill contractors, crews and equipment, so our programs have the best chance of success.”

This article was developed in collaboration with Navarre Minerals, 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.