gmj141-Oct-Dec-mag-web

October - December 2020 Volume 1. Issue 141
$11.95
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Ramelius running






its own race










AFRICAN SPOTLIGHT


DIGGERS & DEALERS PREVIEW







ISSN 1324-4396

04


9 771324 439005
4 - 6 September 2019
Perth, Western Australia

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GOLD MINING JOURNAL (ISSN 1324-4396)
Published by Paydirt Media Pty Ltd.
A.C.N. 063 985 133

EDITORIAL
Editor:
Dominic Piper
Deputy editor:
Mark Andrews

Journalist:
Michael Washbourne COvER 18
When Mark Zeptner took the reins of Ramelius Resources back in 2014,
Art director: the company had minimal cash in the bank, an underperforming gold mine
Nick Brown and an uncertain future. Six years later, having turned fortunes around at
Contributors: Mt Magnet and executed a series of strategic acquisitions including Edna
Keith Goode, May and Spectrum Metals, Ramelius is now on the brink of churning out
Brendan Ryan (Johannesburg) 300,000 ozpa for the first time. Senior journalist Michael Washbourne
speaks with Zeptner about how he transformed the company into a
ADvERTIsIng “serious” gold miner while having a bit of fun along the way
Advertising manager:
Richa Fuller DIggERs & DEALERs 24
Subscriptions: New Super Pit co-owners Northern Star Resources and Saracen Mineral
Kate Blanchard Holdings are certain to receive widespread plaudits from those able
to make their way to Kalgoorlie for the rescheduled Diggers & Dealers
PAyDIRT MEDIA Mining Forum on October 12-14. Despite travel restrictions due to the
Executive chairman:
COVID-19 pandemic, applause will also be directed across the Pacific for
The Perth Mint Giovanny Jefferson the Canada-based management team at Kirkland Lake Gold after another
Bill Repard
stellar year of operations at Fosterville and the acquisition of Detour Lake.
Finance manager:
Mark Andrews’ interview with Kirkland Lake president Tony Makuch leads
our preview to the three-day conference, which also includes a site visit to
– Australasia’s Accounts/administration: Southern Cross with TSX-listed Altan Rio Minerals 50
Lana Luketic
AfRICA
COnfEREnCEs
Ahead of Africa Down Under in Perth on November 4-6, at least two
refiner of choice Christine Oelschlaeger African-focused IPOs are in the works with TSX-listed Sarama Resources
Melita Fogarty
Namukale Nakazwe
and newcomer Megado Gold set to debut on the ASX over the coming
months. GMJ editor Dominic Piper spoke with Sarama boss Andrew
Dinning and Megado’s Chris Bowden about the recent change in investor
Mitchelle Matambo
listings on the Australian bourse
PRE-PREss AnD PRInTIng: sentiment which has paved the way for both companies to consider fresh
Vanguard Press
When you process more than 90 per cent of Australasia’s gold production 26 John St, Northbridge WA 6003
annually, there’s plenty of opportunity to refine what you do. That’s why Member of: Cover image:
The Perth Mint is trusted the world over to deliver quality refining at a Ramelius managing director Mark Zeptner near the company’s
headquarters in East Perth
competitive and sustainable price.

COnTACT Us

Suite 9, 1297 Hay St, West Perth, p: (+61 8) 9321 0355
perthmint.com/refine Western Australia 6005 f: (+61 8) 9321 0426
e: [email protected]
P.O. Box 1589, West Perth,
Western Australia 6872 w: www.paydirt.com.au









MINT0272B-FP A4 RefinerOfChoice.indd 1 11/3/20 4:01 pm

EDITORIAL
Gold bulls



finally land on



African shores




by Dominic Piper


n the editorial for July GMJ, I discussed the dramatic change in market conditions
Ifor juniors in Western Australia. Three months on, the trend is spreading to other
parts of the globe.
In July, we noted an investor shift towards gold exploration stocks which had been
a long time coming. The WA gold exploration sector had been waiting four years for the “trickle down effect” to take
hold among investors and deliver them some of the massive returns the market had made on the high-performing gold
producers.
It has led to the best of times for gold explorers with De Grey Mining Ltd and Bellevue Gold Ltd at the front of the pack
but a multitude of others behind them.
Now, the momentum is gathering behind miners and explorers in West Africa.
There is an adage among African-focused miners that gold is gold, wherever it is extracted from, but the suspicion of
many Australian investors in recent years has been whether companies could actually extract it from Africa and still keep
hold of the profits.
While their domestic-focused peers enjoyed several years of success, the likes of Perseus Mining Ltd and Resolute
Mining Ltd struggled for market recognition. African-focused juniors had an even worse time of it, unable to raise money
for exploration in the face of political and security risks in their host countries.
The risk-off attitude towards African projects suggested Aussies had forgotten their previous love affair with gold stories
from the continent. The period 2005-2013 delivered numerous ASX-listed gold success stories in Africa. Some resulted
in happy endings (Adamus, Papillon, Orbis) while among the others were satisfactory outcomes (Gryphon, Ampella)
scattered with a few disappointments (we’ll leave them unnamed), a bit like any jurisdiction in the world.
The relationship was frosty in subsequent years but in 2020 established producers and ambitious explorers alike are
back in the limelight.
Perhaps the African scene is just following the same trend as we have witnessed in WA over the past few years –
investors being prepared to back companies who display consistent, profitable operational performance.
Now that the producers have established reliable cash flow from operations in Africa – and it has taken some difficult
times for Perseus and Resolute to get there – investors are showing willingness to back them.
There is often a perception that investors work on an “African discount” and will mark down the value of companies and
assets because they are located in jurisdictions which have either political or security issues. However, the recent rally
by Perseus, Resolute and now West African Resources Ltd (WAF) is proof the discount is a red herring.
WAF’s Sanbrado has always been a cracking project which never received fair value in the market but once gold was
poured and cash was generated earlier this year, the company’s share price took off, putting on 139% between April and
September.
This is despite Sanbrado being located in Burkina Faso, a country with severe and ongoing security problems.
With investors now comfortable Australian miners can find, build and keep their African assets, they are piling into
developers and explorers active on the continent. Cardinal Resources Ltd is leading the charge, thanks to a takeover
war between Shandong Mining and Nordgold Inc.
Earlier stage explorers such as Predictive Discovery Ltd, Oklo Resources Ltd, Chesser Resources Ltd, Mako Gold Ltd
and Tietto Minerals Ltd are also enjoying the spotlight, but the starkest example of the renewed support for West Africa
is Mali Lithium Ltd whose audacious bid for Barrick Gold Corp’s unwanted Morila mine in Mali has been fully backed by
investors via a $70 million capital raising.
The Morila deal is the clearest sign yet the gold boom we have seen in Australia may be headed to West Africa. After
all, Northern Star Resources Ltd, Evolution Mining Ltd and Saracen Mineral Holdings Ltd have all grown into multibillion
dollar, multimillion ounce producers on the back of Barrick and Newmont Mining Corp cast-offs.


[email protected] @Paydirt_Media @paydirtmedia @PaydirtMediaAustralia

Page 4



NEWS
www.ddh1.com.au




De Grey rocket



keeps its course






his is what Hemi looked like a month ago and everyone was very
T happy with that. Now, we have Falcon as well which is already
2.6km; sometimes I just think it’s unbelievable.”
– Andy Beckwith, technical director De Grey Mining Ltd.

by Dominic Piper
Andy Beckwith


till only months into the discovery, De Grey Mining Ltd is The latest discovery at Hemi is Falcon where aircore drilling
Shaving to redraw its own expectations around the Hemi has extended the zone to 2.4km long, 80m wide and 250m
project on an almost constant basis. deep. Such is the confidence De Grey is developing at Hemi,
De Grey stunned the entire gold sector in February when RC and diamond drilling started even before the aircore results
it announced a second set of wide intercepts from the Hemi were in.
prospect on its Mallina project in the Pilbara, Western Australia. “As we see more core and RC chips we are getting a really
Those early hits – including 24m @ 7.5 g/t gold, 49m @ 3.7 good feeling at the rig of what’s coming out of the hole,”
g/t and 36m @ 4 g/t from the Brolga zone and 24m @ 4.2 g/t, Beckwith said. “Falcon is a good example of that; it was just a
15m @ 2.5 g/t and 21m @ 2.5 g/t from the Aquila zone at Hemi few holes to begin with and then within a week we had 2.4km of
– sent De Grey shares flying, justifying technical director Andy strike, because we could see that it was looking just like Aquila.
Beckwith’s excitement at the discovery. We very quickly got the diamond rig in even before the assays
Eight months on and even Beckwith is in awe of what Hemi and came back.”
the wider Mallina project has turned into. The challenge now is to decide where Hemi will take De Grey.
“In those early days we spent a long time discussing the likely Managing director Glenn Jardine has spent much of his four
orientation of the mineralisation but in the end it probably months in the job trying to get a fix on that.
wouldn’t have mattered what we settled on, it is so big we just “We have a pretty clear goal of where we want to be; the
couldn’t have missed it,” Beckwith told GMJ. “We’re learning immediate target is to reach that aspirational resource in order
every step of the way but even the dead holes have told us to demonstrate it is, at a minimum, a genuine T1 production
something. We are still trying to get our head around the scale scale; and that’s not including the historical resource [2.2 moz].”
of it.” Most explorers would still be working out their follow-up plans
Dead holes are few and far between with the list of significant eight months after discovery but the speed of Hemi’s growth
intercepts since those early hits long. The company has now has De Grey on a completely different trajectory. Even the most
identified four deposits (Aquila, Brolga, Crow and Falcon) with conservative analysts have estimated Hemi contains at least 4
the entire system mapped to 2,500m north-south, 2,000m east- moz gold with clear daylight to plus-5 moz and the company is
west and 400m depth. Although, with all four mineralised zones intent on hitting that Tier 1 target within 12 months of discovery.
remaining open, those dimensions are set to grow again. In September, the company raised $100 million, allowing it to





















Page 6



NEWS




embark on probably the most expensive single-asset junior
exploration programme in Australian gold history.
De Grey has pledged to spend $83 million on defining the
anticipated Tier 1 resource and testing other priority targets
around Hemi.
“From there, we can begin to demonstrate the upside outside
of the greater Hemi area [the company has more than 150km
of prospective belt] and set up a regional exploration group,”
Jardine said. “To realise that potential beyond the greater Hemi
project requires us to set up the organisation and the systems
and support needed on site to get there.”
Setting the structural environment may be one of De Grey’s
largest challenges. Such is the rapid growth of the company –
its value has increased 3,000% since the start of February and
is now close to the $2 billion mark – it has quickly outgrown
even its most ambitious projections. Much of Jardine’s focus
has been on ensuring the project doesn’t outgrow the company After raising $100 million in September, De Grey is now planning
and vice versa. an $83 million exploration push at Hemi
“We are building an organisation that is totally focused on
maximising the accretive value for shareholders,” he said. “We deposit and we’ll work it all out,” Beckwith said. “We still need
have done a lot of research into the most value-additive ways to do a lot of testwork which we have started but at this scale
of proceeding with Hemi and the most value will be derived processing refractory ore is not an issue because the orebody
by us taking this through to production ourselves. We have is large and near-surface with a low strip ratio and a higher
done a lot of scenario planning internally so that is clear to the ounce per vertical metre than average projects.”
board, management and major shareholders. De Grey will Jardine said early met work on the Brolga zone had indicated
continue to deliver what we say we will, and we are building the high recoveries (96%) from refractory ore using flotation
organisational capability to do it.” pressure oxidation and CIL.
Keeping value within the company will necessitate a dual “That is before we have even begun optimising the met,” he
development strategy, made up of project development and said. “We are going to assess other processes as well such as
ongoing exploration, according to Jardine. Albion and BIOX and will test each zone to come up with an
“We will continue exploration to increase the resource growth overall optimal flowsheet.”
and demonstrate the Tier 1 production potential in less than 12 Giving the company further insurance against any metallurgical
months,” he said. “But at the same time, we will continue with hurdles is its location within an hour’s drive of Port Hedland.
exploration at a more regional level.”
“The capex will not be the driver of economics on this
While the exploration strategy is clearly defined, project project,” Beckwith said. “It is not only the scale but also the
development studies are still in their infancy. Early metallurgical infrastructure advantages we have around us which will offset
work has indicated the Hemi deposits are refractory, a potential any hydrometallurgy costs.
roadblock to economic development in some projects.
“We are close to Port Hedland so have roads, power, gas
However, Beckwith and Jardine have seen little to concern
and water on our doorstep. That is an additional advantage
them in the results so far.
some of the other recent major discoveries in WA didn’t have,
“I’m struggling to see any hurdles now, the reality is this is a big particularly when it comes to access, logistics and capex.”






















Page 8



NEWS


Challa



revitalises




Platina





by Michael Washbourne


n ounce of palladium might currently be worth more than its
Aweight in gold, but Platina Resources Ltd believes its best
chance of a re-rating lies with the latter.
Platina has acquired the Challa gold project,
Platina listed on the back of palladium and other specialty
about 500km north-east of Perth
metals projects in 2006 but with work set to begin on the newly
acquired Challa gold project, about 500km north-east of Perth,
“It’s about validating the company’s strategy of targeting gold in
the company’s focus has definitively switched.
the right jurisdictions,” Nolan said.
Challa is neatly positioned in the middle of what Platina
“I also think because they [Palisades] are Canadian, they see
managing director Corey Nolan described as the “golden
the opportunity we have at hand with the sale of our Greenland
triangle” between three long-standing mining provinces which
asset to the CSE-listed Major Precious Metals. At the moment,
have collectively produced more than 8 moz.
our interest on closing that deal, which is 55 million shares, is
Platina acquired the project from private hands for the issue of currently valued around $30 million, which is where our market
10 million shares and a 0.75% gross royalty payable on any gold cap is currently sitting. So, we think we’re significantly valued on
produced from the tenements. that deal alone, let alone factoring in the upside that comes from
Nolan told GMJ the company decided to seek out a gold the Challa opportunity.”
project in Western Australia after being forced to shelve plans The sale of Platina’s Skaergaard palladium project in Greenland
to progress a promising zinc-copper-gold play in California, US was expected to close at the time of print, with only one of the
amid the global coronavirus pandemic. conditions precedent – approval of the transaction by the CSE
“The gold price was on the move and we thought one of the best – to be satisfied.
jurisdictions back in Australia for finding those types of projects Platina shareholders will retain good exposure to palladium
was going to be in WA,” he said. via its new shareholding in Major Precious Metals and a 30%
“We started reviewing a number of different opportunities and interest in the Munni Munni project in WA’s Pilbara region.
Challa came across our desk. We really like it because it’s in a Despite the newfound focus on Challa, Platina plans to continue
little bit of a ‘golden triangle’ between Mt Magnet, Youanmi and quietly progressing its namesake scandium project (formerly
Sandstone. We were attracted to this little fringe of greenstone known as Owendale) in New South Wales.
belt in the middle of that golden triangle on the edge of the
“We have a completed DFS but scandium is quite a unique
Windimurra Igneous Complex which is under cover and hasn’t
market, so we’re currently talking to a number of different
attracted a lot of historical attention.
players, primarily in the aluminium and the aluminium-alloying
“It enables us to create a presence in the gold space in a space, looking at opportunities to secure offtake agreements
world-class jurisdiction, both geologically and from a permitting that would ultimately provide financing for the project,” Nolan
perspective.” said.
Initial field work at Challa – due to start at the time of print – “The scandium market today is probably somewhere between
will include soil geochemistry and a low-cost RAB drilling 5-20t and we would estimate that probably somewhere between
programme to define and test primary targets. 7-10t goes into the manufacture of solid oxide fuel cells, and
Investors appear to be backing Platina’s move into the gold there’s only one company in the world – Bloom Energy out of
space with the company’s stock up more than 600% since the California – utilising that technology.
start of May, a month before the proposed acquisition of Challa “We’re also looking at a number of technological modifications
was announced. to the flowsheet to try and reduce the capex even further and
Platina has since topped up its cash reserves via two private give it an easier pathway towards production.”
placements totalling $1.8 million, one of which attracted
Canada’s Palisades Goldcorp to the register as a new major
shareholder.

Page 10

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Page 11

NEWS







Alex Dorsch,
Managing Director, Chalice Gold Mines Ltd




It has been a weird and wonderful year for Alex Dorsch and
GMJ was lucky enough to catch a breather with the Chalice
Gold Mines Ltd Managing Director to see how his world has
changed in 2020.



L et me get this straight – in the first half as a natural manager. It wasn’t until I started in
management consulting that I realised having that
of 2020 you had a newborn, a major
technical background provides a solid problem solving
discovery and the pandemic to juggle?
with the ability to effectively communicate and lead.
AD: Indeed, I wouldn’t advise doing all of those tool kit, which is great, but that must be complemented
at once! It has been quite a year so far. I have been After spending 7-8 years on the technical side I came
very blessed on the family front with the arrival of our up with the conclusion that I wanted to go up the chain
second child, we now have a girl and a boy, so my but not via the traditional big corporate ladder. I didn’t
wife and I are very happy. To get a discovery at Julimar like the constraints that you get in big companies. I liked
a couple of weeks after the birth is just completely the entrepreneurialism and unconstrained thinking of
in the spotlight
unbelievable, and took us all by surprise so early smaller companies.
into our exploration campaign. At that time, we were When I joined Chalice, I said we needed to be ambitious
discussing internally our plans to scale back activities and make a world-class discovery. It is such a privilege
given the pandemic. Then our very first drill hole at to be the MD of Chalice, which has delivered on that
Julimar changed everything, which was made even goal. I certainly haven’t looked back.
more unbelievable given we were all largely working
from home. PR: You’ve been recognised now as an emerging
leader in the industry, what do you think of the
It was quite uncanny, but I guess the main learning for
me is that Australia is still poorly explored. If we can find new breed of MDs?
a deposit like that an hour out of Perth in 2020, imagine AD: I think the days of junior explorers being
what else is waiting to be uncovered around Australia. run by a couple of grey-haired geologists out in
The real under cover exploration frontier is upon us and the back shed – with no disrespect to anyone
this is not the end of the story by any means. in particular – are over. The industry is getting
Expect the unexpected is also one of the key things I a new guard, with new thinking, new energy and I
have learned, particularly in the exploration space. You think the exploration industry really needed that. To
need to be ready mentally for the unexpected and can’t get an investor to speculate they need to have trust
be too fixated on rigid planning; you need to be nimble, in management’s abilities on both the technical and
which is one of the best qualities I think we have instilled commercial side. They can’t just deport themselves
at Chalice. The team is always looking for the next into the technical world and become geologists in
opportunity to create value; small investments today can order to understand the value proposition. They need
deliver big returns in the long run. to understand how that exploration play is going to turn
into money.
Being a young MD, I would say having trust in my So, it is good to see a diverse group of young leaders
very capable and experienced team is also key. I have coming through the ranks particularly in small
globally recognised geologists, a very seasoned CFO companies. The safety and security that a big company
and a great team who manage our day to day activities. affords you is great for a young professional, but I am
Trusting them and backing them to deliver has been probably the biggest advocate of taking a leap into a
great to watch.
small company, it’s turned out OK for me anyway!
PR: Was it always your plan to become a But you have to be comfortable taking risks – in a small
Managing Director? company there is no-one else to fall back on. You have
AD: I grew up quite a technical-minded to be constantly aware of risk versus reward and I think
engineering type, I loved the mechanics of if you are comfortable with risk and get the opportunity
how things worked, but I don’t think I started to join a small company – take it.




Page 12

MINING CONNECT










PD: What would you be doing if you weren’t the
MD of Chalice?
AD: On the personal front, I would love to show
my kids the world. As a kid I was very fortunate to
travel through various parts of the world following my dad
in his job in oil and gas. It is eye opening and gives you
real perspective, particularly when you are young. Living
in Australia is great, but you need to have your eyes open
to the rest of the world. Let’s hope by 2030 we can be
travelling freely again.
Professionally, in such a dynamic trajectory that Chalice
is in, it is hard to predict six months away let alone
10 years... I can see myself still driving our projects at
Chalice and hopefully being part of other exciting things
in our industry.

PR: Advice to your children?
AD: They are only two and six months old, so it
might be a quite different world when they grow
up. I think when you live in WA obviously the mining
industry is such a source of opportunity for young
professionals. I would say don’t constrain your thinking, We are still entrepreneurial individuals backed by very Diamond drilling is set to
start at Pyramid Hill
I’d say they can do anything they want and the world is forward thinking, deep value type investors. in October
a big place. Don’t frame your expectations or ambitions They appreciate that there are other levers to be pulled in
on one set of circumstances, try and expose yourself to our exploration portfolio but they also know Julimar is a
as many different parts of as many different industries big project and understanding it will be a long process.
as you can. I think that is a good way of figuring out a bit We are drilling with four rigs, soon to be five rigs, and it
about yourself and what you are passionate about. would be a good problem to have if we keep finding new
I was lucky to be exposed to corporate finance and some zones of mineralisation. What excites me is that we have
small companies early on. I would say to my kids try and the ability to control the learning curve, and utilise our
accumulate these experiences early on in your career knowledge to make more discoveries.
and that way you really get an understanding of what Learning what moves the needle for investors and what
drives you. Running a small company is hard work and investors care about has been a good experience for me.
takes up a huge amount of your life, so if you are not
driven, you are going to quickly lose interest or burn out. PR: So, what now for Pyramid Hill Project in
You have to find out what you are really happy to put the Victoria?
hours into, because the last thing you want is to put in AD: We have a lot of third party interest right now
the hard work and not to get any reward back. on Pyramid Hill. In any case, we are getting ready for

PR: How have expectations changed for Chalice our next phase of diamond drilling which will start in early
after the Julimar discovery? October. I think we have done the hard yards there in
AD: At the beginning of the year we were hungry terms of early stage targeting. Now we have screened a
few thousand square kilometres and honed in on a few
for exploration success in Victoria and were key targets, with our main focus the Karri Prospect.
pushing really hard trying to hone in on a big
gold system. But the expectation there was to deliver a So, we think we are at the pointy end of the discovery
material result before the balance sheet was diminished journey, the question now is can we drill in the right
significantly, and now that we have made a discovery at places and uncover a major gold discovery? I am still
Julimar, the expectation has changed a little. very passionate about our project in Victoria so having
Instead, people are starting to think OK in five years’ time Julimar doesn’t necessarily detract from that, but it does
give us a platform to be even more aggressive in Victoria
where will these projects be, what are the necessary and I think we really need to do the project justice. Not to
steps ahead of getting that project developed and what mention a platform to pursue all of our other nickel and
is Chalice doing to manage those risks and unlock the gold exploration plays around Australia – it should be a
value in the most efficient way possible. great year ahead of us!




Page 13

INNOVATION


Q A

&








A string of successful mine developments
across Africa have placed Perth-
headquartered Lycopodium Minerals Pty Ltd
at the forefront of project development and
processing plant design in the gold sector.
GMJ spoke to Lycopodium managing director
Peter de Leo about the company’s approach
to technical and cultural innovation.

GMJ: Innovation and technological advances
are playing an increasingly important role in
the gold sector. How does Lycopodium stay
on top of developments?

Peter de Leo: Lycopodium is routinely engaged by
gold companies to deliver bespoke, techno-economic
optimum projects and unique ESG framework or
standards for their projects. We pride ourselves in
delivering a tailored solution for each project.

Where is your innovation drive coming from? Similarly, we have excellent relationships with OEMs
and technology developers and collaboratively
PDL: We have a culture of continuous improvement
assist in the development and integration of their
and innovation led by our process and engineering
new equipment or emerging technologies into a gold
teams. Our teams remain abreast of the leading
processing plant. Lycopodium is also partnering with
technologies in industry and we have numerous
a number of clients in pursuit of improved construction
industry firsts in terms of process configurations,
techniques and enhancing our modular processing.
equipment applications and plant configurations in
the gold industry. We are sought out internationally Are there broad problems clients are looking
for our ability to reliably implement new and emerging
for innovative solutions to or are their needs
technologies into gold processing plants.
specific to their individual projects?
Recognising the value of innovation, we have patents
in place for many of our innovative solutions, which PDL: The pursuit of lower costs by the gold industry,
provides us with a clear differentiator as an innovator both capital and life cycle, continues to drive
in the gold industry. innovation. This is not a new topic and always remains
in the fore. Clients have a minimum expectation that
How do you work with clients and suppliers to Lycopodium will, in all instances, look after their best
create innovations? interest regarding the upfront, operating and sustaining
costs for a project.
PDL: We participate across industry committees and
Specifically, clients are increasingly pursuing ways of
technology groups and cooperative research centre
treating lower grade ores, either via highly selective
projects and engage with universities through research
underground mining, minimising waste haulage or
groups.
removing gangue with ore sorting.
We have long-standing relationships with many clients
Environmental, Social and Governance (ESG) is
and industry colleagues, built over the delivery of
simply a key facet of maintaining a sustainable gold
many projects. These trusted relationships afford the
mining sector. Lycopodium embraces the challenges
opportunity for Lycopodium to assess, trial, develop
these standards require which has resulted in
and integrate new technologies within their projects.
innovative solutions to reduce our environmental
Page 14

impacts, such as energy efficiency, integration of processing and interpretation of the big data sets
renewable energy, water minimisation and reuse, generated from the operating plants in real time.
as well as construction methodologies such as On generation, we have been involved in projects using
modularisation. standalone PV cells to operate remote equipment,
through to hybrid power stations where PV and batteries
Do you borrow ideas from other industries? reduce the reliance on fossil fuels. We are also currently

PDL: Cross fertilisation is very important. We are assisting several clients on the use of hydrogen as an
constantly looking at the work of others, looking at how energy source.
problems are dealt with in different sectors, constantly In water, we are working on minimisation strategies
looking for and accumulating the best ideas. including tailings filtration and we also have an ongoing
role assisting a technology developer with on-site
We work across a broad range of mineral
commodities, as well as the chemical industry. We are cyanide generation using plasma technology, including
the design of their modular demonstration plant.
always looking for opportunities for cross-fertilisation
from other industry segments into gold processing While Lycopodium is best known for its expertise in the
plants. This includes not only processing and design and construction of gold processing plants, we
equipment technologies, but construction technologies are also involved in a number of novel mining techniques
as well. for niche applications. These include underwater mining
units, mobile dry mining units, and ship-mounted mining
Can you tell us about some of the innovations units and gold recovery plants.
– both the challenges and solutions – you are
currently pursuing? Where is innovation and technology taking
us? Will a gold plant look very different in 10
PDL: In an effort to lower our carbon footprint
or 15 years from now?
Lycopodium continues to integrate technologies which
both reduce energy demand and increase green energy PDL: Continued applications from the internet of things,
applications in gold processing. such as dynamic digital twins, will become a feature
Ore sorting and alternative comminution equipment of the gold mining industry over time. Automation is
allow us to reduce energy demands in processing, while already enabling gold processing plants to be operated
Orway IQ (OIQ), a JV with Process IQ, provides a cloud- remotely, and that can be expanded to multiple gold
hosted, digital twin of the comminution circuit, enabling processing plants from a single off-site control room.
real time optimisation of the comminution circuit to This is already in place within the iron ore industry and
maximise throughput and optimise power consumption. is a natural stepping point for the gold industry.
MillROC uses artificial intelligence to assist with the Sorting technologies, coupled with alternative breakage
and liberation technologies,
will continue to reduce the
energy requirements to
enable the recovery of gold.
Partial or total underground
processing is likely to increase
over time, thereby avoiding
transport of ore to surface
and the associated surface
impacts. Cost-effective
generation of green energy
may enable the integration
of entirely new technologies
which may be more energy
intensive or enable more
on-site processing, thereby
creating value added products.
Combinations of these two
approaches will result in new
gold processing plant designs.
So yes, a gold plant will not
be the same a decade from
now.






Page 15

INNOVATION














MLG’s drive to innovation





by Dominic Piper industry, MLG Oz is more focused on how innovation and technology
can improve safety and environmental outcomes.

commitment to innovation is enabling MLG Oz Pty Ltd to deliver “We continue to look at automation and how we can integrate it into
A safety, productivity and environmental improvements to gold various parts of the business and it has its place to play but the big
mines across Australia. thing is regulatory compliance. There has been some significant
changes in standards around driver fatigue and load restraint,
Kalgoorlie-based MLG Oz has been providing logistics expertise to
etc,” Leahy said. “We have a whole suite of technologies to better
miners across Australia for close to two decades but as its long-term
utilise time and keep people safer and more productive. Fatigue
clients grow and regulatory requirements become more complex,
monitoring, transitioning to paperless pre-starts and maintenance
the company is finding its service offering is changing.
team mapping on devices all provide safety and performances
Integration is key to MLG’s recent success with the company
benefits for our operations and in turn our clients.”
developing a multifaceted approach which has given it the skills and
Given the low value bulk nature of the material movement associated
expertise to advise clients on supply chain management across the
with mineral projects, logistics considerations are rarely at the
project spectrum.
forefront of gold project economic decisions but, Leahy said, they still
“Because of our life-of-asset approach, clients will increasingly engage
have the potential to dramatically effect input costs.
us from early on in a project,” MLG Oz managing director Murray Leahy
“Could poor logistics planning sink an entire gold project? Probably
told GMJ. “It is not just about providing aggregate in the construction
not but it will have a greater impact than many companies realise,”
phase and trucking or crushing services in the operations stage, we
he said. “The most common mistake we see is companies
offer advice and planning from as early as the feasibility study stage.”
underestimating the permitting time associated with gaining
Leahy said the increased regulatory requirements over the last
operating licences for road trains along with underestimating the
decade had placed an additional permitting burden which companies
maintenance costs of the road networks required to operate these
weren’t always equipped to manage.
units. The quality of roads is also a factor in remote locations where
“The industry has changed immensely over the last 10 years,” he road maintenance could add $20-30/oz to production if not planned
said. “Compliance in areas such as road train access on public road correctly.”
networks, chain of responsibility management, engine emission
Good logistics planning becomes crucial when gold companies
and other environmental standards are driving a step of change in
are hauling ore from satellite deposits to a central processing plant.
navigating a path to market for a large percentage of our customer.
Leahy said companies like Ramelius Resources Ltd (see cover
We have an internal team with a strong relationship with the
story on page 18), had been successful because they had dedicated
regulators along with an extensive level of experience dealing with
planning around haulage.
these issues to ensure we can navigate a path through permitting.”
“The advantage of engaging throughout the project life and across
New state and national standards around greater efficiency in
the supply chain is that logistics become naturally more efficient,” he
bulk transport has driven MLG Oz towards engaging with major
said. “An operation can actually grow as your supply chain becomes
automotive groups to find innovative solutions.
more efficient. You can shift tonnes more cost effectively, giving
“We are working on road train designs with our OEMs to develop you the potential to lower cut-off grades and increase the volume of
innovative configurations that deliver higher payload and energy economic tonnes to be hauled.”
use efficiencies to drive the best possible outcome to our customers
The strong price environment means gold miners are eager to take
projects,” Leahy said.
advantage of every ounce available to them and Leahy is revelling in
The results will not only allow clients to comply with new standards the success and growth of long-term clients.
but also deliver improved economic outcomes according to Leahy.
“I am really proud of the customers we are associated with and the
“Energy efficiency has become an important part of the modelling customers we work for and as they grow, we hope to extend our
process,” he said. “The capital cost, human cost, environmental cost; relationships further and therefore providing growth opportunities for
they are all factored in to be part of the investment decision about MLG,” he said. “We have grown up with these guys and have been
how we service customers.” fortunate enough to be able to support them and in turn they have
While automation is the innovation buzzword throughout the mining supported us.”
Page 16

ai160005190611_GMJ_advertorial_october_press ready.pdf 1 14/09/2020 10:51:47 AM











































C Trusted Advice – A Rare but Precious Commodity
M
F
Y ew things are more rewarding driving the scope. Of course, it is a risky proposition to
CM than providing trusted Only then can we offer suggestions that invest significant time and company
MY engineering advice to a client may give a better outcome – whilst still resources into a client relationship
and seeing how that advice can without a commercial return up front.
CY respecting the initial scope that has
transform a project and enable client However, as trusted advisors in the
CMY been presented.
success. mining industry, we have learnt that the
K This can be a difficult balancing act. At time spent building these trusted
However, at Mintrex we have found the outset of a project, the client may be
through experience, that being an simply seeking a price for the job. relationships with our clients is critical to
effective advisor requires a lot more than Alternatively, the client may want one of the success of their projects.
just being able to offer good engineering our senior executives to just listen and When we are awarded a project, our
advice. engineering approach is to vigorously
demonstrate an understanding of the
As trusted advisors, we need to sit difficulties present in the project. question every assumption – rather than
alongside the client and assist with During these initial stages of just copying a proven design that may
important decisions - irrespective of engagement, it is important to first not be appropriate for the current
what is in the best short-term, financial understand the client’s situation, the circumstances. Of course, we do not
interests of Mintrex. want to reinvent the wheel. We remain
unique challenges of the project and the focused on retaining aspects of proven
Also, a trusted advisor must earn the constraints that the client may be designs that are appropriate.
right to give that advice in the first place. working under.
It is critical to establish that your That requires a lot more listening than At Mintrex, we know that our client
motivation is to improve client speaking. It can also require a ultimately needs to deliver a strong
outcomes. We must also ask significant time commitment to fully return to investors. It is our responsibility
appropriate questions, to fully understand the complexity of a project to provide the trusted advice necessary
understand the wider context of the and to be able to give the client the best to achieve that goal.
project, and the key objectives that are
possible guidance at the outset.






If you would like to discuss your project with the trusted advisors at Mintrex please
contact us on 08 9442 3333 or visit our website www.mintrex.com.au for more information.
Photos: Leon Lorenzen (Executive Consultant), Tom Kendall (Executive Engineer), Naim Abou-Rjeily (Manager of Projects and Studies)
Alan Kerr (Senior Principal Engineer), Fiona Morgan (Managing Director and CEO), Hien Ngo (Technical Director)

COVER


Ramelius gallops




into the next tier





Before exiting the stage following his presentation at the 2017 edition of Diggers & Dealers,
Ramelius Resources Ltd managing director Mark Zeptner was asked if his company had a
dividend policy. He cheekily replied: “Yes, our policy is we don’t have one.”












































by Michael Washbourne


ot flustered by Zeptner’s quick-witted response, the 2014 – underneath all the jokes and frivolity which helps keep
Nintrepid investor asked if the company would “seriously the day-to-day stresses of working life at bay, there is a serious
think about” paying dividends to its shareholders at some point gold producer mapping out a long-term future.
in the near future. “Mining is a serious business and you’ve got to do it safely in
Again, with tongue firmly in cheek, Zeptner replied: “Yes, we’ll terms of looking after your environment and all of those things,
think about it.” but it doesn’t mean as a team you can’t enjoy what you do,”
None of what Zeptner said was incorrect. At the time Ramelius Zeptner tells GMJ.
did not have a dividend policy, but plans were well and truly “As people say, things are going best when it’s enjoyable, but at
under way to place the company in a position to announce one. the same time it’s not like it’s a party. So yes, while it’s a serious
It was also a moment in time that perhaps best encapsulates business we’re in, we like to enjoy what we do, we like to work
how the relatively unheralded Ramelius has gone about its with people who get along and we all share in the success.”
business since Zeptner took the reins of the company back in





Page 18

Less than two months after Zeptner was quizzed during “Obviously around 2018 we felt we were getting well positioned
Diggers in August 2017, Ramelius acquired the Edna May gold in terms of life-of-mine and cash reserves to be able to return to
mine, about 300km east of Perth, from Evolution Mining Ltd for the dividend-paying days. It was always a desire, it just became
a total consideration of $90 million. It would become the second a matter of being in the right position to be able to do it.”
operating asset in the company’s portfolio alongside Mt Magnet As this edition went to print, Ramelius was celebrating its share
in Western Australia’s Murchison district. price hitting an all-time high of $2.50, its market cap surpassing
It would also kick off a series of strategic acquisitions around $2 billion and joining the ASX200 for the first time.
those two mining centres that would ultimately put the company Those milestones followed a record-breaking year for the
in a position to pay out a maiden dividend at the end of FY2019. company in FY2020 with new benchmarks set for full-year
As outlined at its AGM in late 2018, Ramelius has committed group production (230,426oz at $1,041/oz AISC) and quarterly
to a minimum 1c/share dividend each year with a maximum group production (86,517oz at $1,164/oz AISC for the June
payout of 30% of free cash flow. The policy remains subject to quarter), as its cash and gold balance climbed to $185.5 million.
the company maintaining a minimum cash and gold balance of Ramelius expects to better those numbers in FY2021 with
$50 million and a reserve life of at least five years. group production of 260,000-280,000oz at $1,230-1,330/
Ramelius rewarded shareholders with the promised 1c/share oz AISC guided, including a conservative output of 65,000-
dividend post FY2019 after recording a net profit after tax 70,000oz at $1,250-1,350/oz AISC for the September quarter.
(NPAT) of $21.8 million. That fully-franked offering was boosted “Records are always nice, you’re only as good as your last
to 2c/share last quarter after the company’s NPAT surged quarter and fortunately for us our last quarter was our best
420% to $113.4 million in FY2020. ever,” Zeptner says.
“This is our third year above 200,000oz and for that to come at
a time with COVID in the background…to be able to kick up to
record levels is very satisfying for the team, especially now that
we’re delivering some serious cash flow to the bank balance
as well.”
Celebrating records and being within touching distance of
churning out 300,000oz in a single year is a far cry from the
perilous position Ramelius was in when Zeptner was appointed
chief executive in June 2014, having been its chief operating
“ While it’s a serious business
officer for two years prior.



we’re in, we like to enjoy what we
do, we like to work with people who get

along and we all share in the success.



Zeptner, a mining engineer, recalls having a mandate of simply
doing everything possible to keep the company afloat during
what proved to be a challenging time for all junior stocks but
especially single-asset producers.
“At the time it was about making sure that Ramelius survived
the short to medium term, to be brutally honest,” Zeptner says.
“Gold price would have been $1,400/oz, we had about $15
Mark Zeptner million in the bank and Mt Magnet was having some issues
in the early days. Even our geological models weren’t quite
“The company actually paid a special dividend back in 2009 on performing as we had hoped. So, it was all about surviving and
the back of one or two exceptional years from the Wattle Dam getting the operations up and running as they should.
gold mine and we still had a large retail shareholder base who
“We were able to do that and in doing so we just became more
yearned for those days to return,” Zeptner explains.
comfortable with the orebodies and the processing facilities.
“We always had in mind that at a point in time when we had a Because of all that, I think we’ve been able to become better
clear runway in terms of life-of-mine and the bank balance to be operators, which then enabled us to benefit from things like the
able to afford not only dividends, but we had enough money to rising gold price.”
put into our own projects and exploration, we would look more
At the end of his first 12 months in the hot seat, Zeptner was
seriously at a dividend policy.
promoted to the managing director’s chair. With operations at


Page 19

COVER

The 1.9 mtpa Checkers mill, which services the Mt Magnet
operations in WA’s Murchison district






































Mt Magnet now settled and being supported by critical feed Zeptner highlighted the importance of looking beyond the
trucked from the Vivien and Kathleen Valley mines, Ramelius headlines which are there for all to see when acquiring an asset
returned a profit for the first time in years and Zeptner could from a motivated seller.
now start thinking about growth rather than survival. “The reality is if you’re going to go and buy someone else’s
While Mt Magnet was not yet producing 100,000 ozpa, Zeptner project, if it has a decent production rate – let’s say 100,000
and the rest of the Ramelius board recognised the need to ozpa – and it’s priced at a relatively competitive cost and it’s got
upsize the company’s portfolio to house a greater output closer a long mine life, then generally they’re not going to be selling
to 300,000 ozpa if it wanted to “enjoy the same valuations as those,” Zeptner says.
our bigger peers”. “In most cases it will be because something doesn’t fit their
“That was the strategy then and effectively still is the strategy portfolio anymore, generally that will be mine life, so you’ve got
today,” Zeptner says. to make your own luck there. And in some instances the cost
Evolution was in the midst of its own acquisition spree and may be high, so you’ve got to do what you can to trim costs and
picked up the likes of Cowal, Mungari and an economic interest reduce that back down to an acceptable level.
in Ernest Henry. That meant operations such as Pajingo and “With a number of our acquisitions, one of those boxes wasn’t
Edna May were no longer core to its burgeoning Tier 1 asset ticked for the previous owner and that enabled us to acquire
class. those assets. It’s then been up to us to turn that around either
Edna May ticked all the boxes for Ramelius; consistent by extending life or reducing costs, or both. And that was
production, immediate opportunities to increase the mine life definitely the case with Edna May.”
and located in WA. At the time, some sections of the market Under Zeptner’s leadership, Ramelius has recorded six
were critical of the purchase and suggested the company had
taken on a troubled asset which one of Australia’s top gold
“ To be able to kick up to record
miners was desperately seeking to dispose of.



levels is very satisfying for
the team, especially now that we’re

delivering some serious cash flow to
the bank balance as well.”
Claimed underground production at Edna May totalled
51,792t @ 4.96 g/t gold for 8,256oz for the June quarter

Page 20

consecutive years of NPAT. Underpinning that accomplishment a couple of those in our portfolio; Vivien being one and Marda
is the performances of both the Mt Magnet and Edna May being the other obvious one. Neither of those were ever going
operations. to be big enough to have their own processing plant and that’s
In FY2020, Mt Magnet churned out 167,129oz and Edna why basically they’ve been sitting there for as long as they
May produced 63,297oz, with the contribution from the latter have, especially in the case of Marda.”
expected to rise to circa 115,000oz in FY2021 as the new Ramelius also emerged successful from what turned into a
Greenfinch open pit comes online and satellite feed is trucked bidding war with Alkane Resources Ltd for Explaurum and its in-
in from the Marda deposit. demand Tampia Hill project, 148km south of Edna May, in late
Marda, about 190km north-east of Edna May, was acquired in 2018. First ore from development of an open pit is scheduled
February 2019 from the liquidators of Black Oak Minerals. All for FY2022.
four central pits are currently being mined and almost 300,000t Zeptner says while the company places a high importance on
of ore is stockpiled on site for future road haulage. exploration across its existing operations, strategic acquisitions
Trucking ore over considerable distances does not appear to were proving to be equally as fruitful.
faze Ramelius, having regularly transported feed from Vivien “We’ve found with exploration that unless you’re really, really
more than 300km by road to Mt Magnet for the best part of five lucky – and I think we’ve been pretty successful to date – not
years. many people are finding completely new gold mines, so you
“Historically people wouldn’t be comfortable trucking beyond need to supplement your exploration with that second arm to
let’s say 100km, whereas in our case a lot of it has to do the strategy which is acquisitions,” he says.
with access and our projects being relatively close to sealed “I think we’ve been pretty successful with picking the right
bitumen roads,” Zeptner says. acquisitions and a lot of that is due to a pretty rigorous DD
“These are not gravel roads. Once you get beyond 100km on process and having a team that’s been around for some time in
the gravel, the maintenance aspect of that becomes inhibitive. Ramelius to give you that consistency in terms of the way you
But trucking these projects mainly on sealed roads and having look at assets and what boxes you need to tick before going
better technology in terms of the tonnes you can fit on certain after something that you’d like to own.”
road trains helps keep those costs pretty competitive. Zeptner says the opportunity to add stranded assets such
“I think also the reality is there are some projects that are just as Marda and Tampia Hill to the production profile was not a
not big enough for their own processing facility and we’ve got consideration at the time of running the ruler over Edna May.


Ramelius has been mining underground at Edna May since
early 2019












































Page 21

COVER







“Similar to exploration, we keep that as upside,” he says. “We technical staff. We’re finding new orebodies
always make sure we can see a return on our investment, such 3-4km from the processing plant.”
that if we pay ‘X’, can get ‘X plus’ back? And then if there’s The question now for Zeptner to answer is how
exploration upside or other intangible strategic benefits, they Ramelius will achieve its ambition of becoming a
can play out down the track. 300,000 ozpa gold producer. While the company’s
“We don’t want to rely on the need for big exploration success two operations will go close to meeting the
or the fact that you become the only mill in town to justify wholly targeted output, a third asset is needed to bridge
and solely an investment decision. We think that’s a higher risk the gap.
strategy and something Ramelius has typically shied away “I think that’s better than stretching to get to
from.” 301,000 ozpa and trying to hang on for dear life,”
The most recent addition to the Ramelius stable was the highly Zeptner says
sought Penny West project, about 150km south-east of Mt “So it’s very much on the cards, but we’re not in a
Magnet, via a takeover of Spectrum Metals in February this rush. For all the deals that we have done, we do
year. a lot of DD on projects that don’t quite make it so I
Penny West hosts an inferred resource of 799,000t @ 13.8 can’t say when that will happen, but it’s something
g/t gold for 355,500oz, including 569,500oz @ 16.8 g/t for over the next 6-12, to 18 months that if the right
306,800oz at the emerging Penny North prospect. The historic project comes along for the right price, we’ll be
mine produced some 85,000oz grading 21.8 g/t gold during the there.”
early 1990s. Zeptner has watched the likes of Evolution,
Despite having to wait for Spectrum to overcome a legal dispute Saracen Mineral Holdings Ltd and Northern
with project partner Venus Metals Ltd before his company could Star Resources Ltd grow into “serious” mining
make a move, Zeptner said Penny West had long “looked, companies over the past decade, particularly
smelt and felt like a Ramelius asset”. on the back of strategically timed acquisitions,
“Any time you have a project that’s twice the grade and half the and once again he is not shy about his desire to
distance from your processing mill at Mt Magnet than Vivien, see Ramelius follow a similar path into the next
and it looks in geometry terms like a high-grade, medium- echelon of Australian gold producers.
sized underground operation, it looks like a Ramelius project,” “Moving up to 300,000-400,000 ozpa will go a
Zeptner said. long way to achieving that…but I’m sure there’s
“Once Spectrum had broken the perception that they weren’t also part of the market that would like us to bed
just drilling into the old Penny West and they had actually found down our plans over the next little while, which is
a new deposit called Penny North and were growing a very why we’re not in a hurry to make that third asset
high-grade, high-margin deposit there, we just felt it looked like happen,” Zeptner says.
it wasn’t going to be big enough for its own processing plant “Definitely we think you need at least five years
and it could be readily truckable into Mt Magnet.” and you need 300,000 ozpa [to move into the
With a production history dating back more than a century, Mt next class of mid-tier gold producers], but you
Magnet has been described as “the gift that keeps on giving” by also need to be a good operator and you need
some Ramelius staff. When Zeptner arrived at the company in to have reasonable costs and some exploration
2012 the mine had a reserve of life of eight years. That outlook upside.
remains in place today. “We’d be happy to have even half the valuation
“It’s a classic story of a rolling life-of-mine, but that only works as of those guys and obviously being talked about
long as you are putting money into exploration and you’re really as potentially the next Saracen is really nice. So
working the asset hard; it won’t just happen automatically,” here’s hoping.”
Zeptner says. While there are no guarantees on how things will
“I’m a mining engineer so I don’t know all the geological details, play out for Ramelius in the years ahead, one sure
but I do keep pretty close to my heart one of the sayings that thing is Zeptner retaining his sense of humour
gold is where you find it and the best place to look is usually while going about his day-to-day business.
where you’re already mining. Unfortunately for exploration “We used to tell jokes about the gold price going
geos, that’s not as exciting as finding a new gold mining district, to $2,000/oz Aussie; now we’re telling jokes about
but you’ve got a lot better chance of finding extensions in an it being near $3,000/oz because these really are
area like Mt Magnet, for example. The amount of different heady times for gold,” he says.
mineralisation types that we’re finding today make it quite an
exciting place for not only the business, but for some of those



Page 22

The Eridanus open pit at Mt Magnet
















It’s a classic story of a rolling
life-of-mine, but that only works
as long as you are putting money into

“ation and you’re really working
explor
the asset hard; it won’t just happen
automatically.














Edna May is now processing ore from the Marda satellite
deposit, some 190km to the north-east

Page 23
Page 23

DIGGERS & DEALERS PREVIEW



























Kirkland detours Super Pit














by Mark Andrews


t is a safe bet that high acclaim will come for both Northern Detour Lake is the company’s second flagship asset in
IStar Resources Ltd and Saracen Mineral Holdings Ltd Ontario, Canada, and the current reserve base can sustain
at Diggers & Dealers, October 12-14 in Kalgoorlie, for a mine life of more than 20 years.
their acquisitions of equal stakes in KCGM and resultant In 2019, production from Detour Lake totalled 602,000oz @
ownership of the Super Pit. AISC of $US1,101/oz.
And applause may well be heard across the Pacific by an The addition of Detour Lake means Kirkland Lake is targeting
equally impressive company in a similar ilk. production of 1.35-1.4 moz gold at operating cash costs of
“We looked at that. In terms of value paid and the value that $US410-430/oz and AISC $US790-810/oz in 2020.
they see, we would have been just as happy to be a partner Detour Lake and Fosterville in Victoria (2019: 619,000oz
there as anyone of those two. The difference for us was @ $US291/oz) are somewhat benchmarks for acquisitions,
timing; as that was happening, we were having discussions while the low-cost nature of Macassa, Ontario, (2019:
around Detour Lake,” Kirkland Lake Gold Ltd president Tony 241,000oz @ $US695/oz) represents the business model
Makuch told GMJ about his company’s interest in the iconic Kirkland Lake is committed to.
Kalgoorlie asset.
“We have been pretty diligent from an M&A perspective and
“One deal would see us be a 50% operator and the other if we see another opportunity to be as transformational as
we could own 100% of and that is where the trade-off came. Fosterville has proven to be and we are in the process of
And it is their backyard, Detour Lake is in our backyard and proving Detour Lake to be, that is something we will look
there are certain times to stick closer to home when the at,” Kirkland Lake senior vice president of investor relations
opportunity arises.” Mark Utting told GMJ.
Shareholders were overwhelmingly supportive of Kirkland “When we took Fosterville from 150,000 ozpa gold to up over
Lake’s intention to buy Detour Gold Corp, with the implied 300,000 ozpa and obviously last year we did over 600,000oz
equity value at the time of $C4.9 billion. at such very low unit costs, it resulted in profitability and cash
The transaction for Detour Lake – one of the world’s largest flow that really are in a leadership position in the industry in
open pits – was completed in January at which point Kirkland terms of those metrics.”
Lake became the proud owner of a mine producing at rate Being a debt-free, cash generating machine ($US537 million
of about 600,000 ozpa gold and hosts reserves of 14.8 moz cash as at June 30) certainly positions Kirkland Lake to
@ 0.97 g/t. cherry pick a Fosterville or Detour Lake-replica from another



Page 24

company’s stable. However, “We have typically done well with the generalist segment of
both those purchases were the market even when a lot of people in the industry weren’t.
made with grand ambitions in We have always operated the business from the standpoint
mind. that you focus on generating solid profitability – solid cash
“The technical quality of the flow from high quality assets that are low-cost with enough
geology group working at scale to generate significant profitability.”
Fosterville is second to none in Given investor interest is now also following exploration
the world. Exploration success stories, Kirkland Lake could find its popularity further
doesn’t come easy. We’ve put heightened in coming months given it has a string of
the money to work and we exploration programmes in play.
spend a lot of money exploring In addition to the in-mine and district-scale exploration
at Fosterville,” Makuch said. potential being demonstrated at the Swan Zone, Lower
“If you look at 2016, we put Phoenix, Cygnet, Harrier and Robbin’s Hill at the 2.1 moz @
$15 million, $40 million in 21.8 g/t Fosterville gold mine, Detour Lake is also shaping
2017, $50 million in 2018, $70 up nicely for the company.
or $80 million in 2019 and this Drilling in the central portion of the Saddle Zone at Detour
year we are spending over Lake returned a hit of 1.1 g/t gold over 142m, including 9.39
$100 million at Fosterville. g/t over 2m, 2.15 g/t over 16m and 1.23 g/t over 12m, to
Basically between 2016 and confirm continuity of the mineralised structure between Main
2017 we spent more money on and West pits.
exploration drilling in the area
“We have a lot of internal growth that we have to maintain. At
than was spent in the 20 years
Fosterville that is discovering the next Swan or another two
prior.”
or three Swans sitting there and we are really excited about
The Swan Zone – 1.6 moz what we are doing at Detour Lake,” Makuch said.
@ 38.6 g/t in reserve – is
“We have talked about not only growing production to
becoming folklore and is where
700,000 ozpa and then higher than that over the next 3-5
the bulk of production comes from at Fosterville.
years but also the potential to almost double the resource
Recent infill drilling into the Swan reserves intersected and reserves at Detour Lake. We want to grow Macassa
higher than expected grades and included visible gold – 976 from 210-220,000 ozpa this year to 400,000 ozpa by 2023
g/t gold over 7.4m, 933 g/t over 6.4m, 416 g/t over 6.8m once we have the shaft [No. 4] completed.”
and 222 g/t over 8.1m – with the company reporting good
Despite the organic growth opportunities being developed,
potential to increase the reserve base yet again.
Kirkland Lake knows it is in a plum position to expand its
“There has been a lot of holes drilled, a lot of theorising growth profile in other ways without stretching the budget or
and we are trying to take advantage of technology as much horizons too far.
as possible, whether it is the new assay
Makuch said the skillsets, geology and
method like Chrysos or better ways to do
attitudes shared between the Canadian
downhole and log core faster,” Makuch
and Australian mining fraternities were
said.
complementary, hence, the success of
“We have done 3D seismic to really Kirkland Lake down under and the likes of
understand what’s going on and getting a Northern Star, St Barbara Ltd and Evolution
real sense of the structural geology in the Mining Ltd across the Pacific.
region and testing a lot of different ways to
Makuch sees potential for more successful
determine what is going on. Fundamentally,
ventures from Australia’s mid-tier gold
drilling a lot of holes and putting the
companies in North America, however, the
money to work is key. We have joined
“hindrance” of not being able to travel and
with universities in the region like Monash
conduct proper due diligence could stymie
which has some very strong structural Tony Makuch M&A.
geologists working to really get an in-depth
“You have to go kick the tyres, hear the
understanding of it.”
engine; take it for a drive,” Makuch said.
It has been a rapid ascension for Kirkland Lake at Fosterville
“We are in a good spot in many ways. You read a lot in
since 2016, with the company’s performance at the mine
the media that there is not a lot of room left for M&A, we
triggering a response from generalist investors not typically
are pretty disciplined on that and focused on cash but also
interested in gold.
shareholder returns. We don’t want to issue shares and buy
“The kind of results we were getting at Fosterville meant
back shares, we have raised our dividend [$US0.125/share
we did come up on the radars of funds and it has really
quarterly dividend paid in July] and have potential to raise
accelerated now as the whole market is looking for an
our dividend again very shortly. Our share buy back and
attractive place to invest in unusual times,” Utting said.
Page 25
Page 25 Page 25

DIGGERS & DEALERS PREVIEW
A drive-in, drive-out, regionally-based underground
workforce at Fosterville has seen the high-value
gold mine in Victoria function uninterrupted.
organic growth are our main disciplines we are focusing on.” Victoria has been the Australian state most affected
by COVID-19 and at the time of print Premier Daniel
Kirkland Lake’s latest round of consolidation saw its
Andrews was figuring out a way to release the State
wholly-owned subsidiary St Andrew Goldfields Ltd enter
from its strict lockdown.
a strategic alliance agreement with Newmont Canada FN
Kirkland Lake Gold Ltd president Tony Makuch said the
Holdings ULC to explore and develop opportunities around
State Government’s job of easing restrictions was not
the company’s Holt Complex and Newmont’s properties in
easy and welcomed its support in keeping Fosterville
Timmins, Ontario. operating.
Newmont will pay Kirkland Lake Gold $US75 million to “We were working on a ventilation system and that got
acquire an option on certain mining and mineral rights delayed a bit. The engineers and consulting company
related to the latter’s Holt property. were actually from Germany and installing surface fans,
so we had to get some people from Australia to do the
“We have always had a relationship with Newmont and
final commission and that was up and running about
said, ‘how can we do this?’ We worked on some other a month ago,” Makuch said. “The electrical substation
opportunities in the region, we have a large land package, was started and stopped, while diamond drilling was
so we bring that exploration acumen to the table,” Makuch going on most of the time.”
said. While sympathising with the Government’s current
“We have this mill strategically located, like at Fosterville situation and otherwise enjoying a good relationship
with various departments, there was one bugbear for
and other people can explore there. If they find something
Makuch in Victoria.
around what is a permitted plant – I don’t know how many
“There is a kangaroo or moose on the table if you like;
more mills are going to get permitted in Australia or Canada
we didn’t appreciate the new royalty that they basically
– so strategically it was there and a good opportunity to work
imposed on Fosterville. But we lick our wounds and
with Newmont in terms of mining new deposits or bringing move on,” Makuch said.
some of these other high exploration targets maybe further
A royalty of 2.75% of the net market value of gold
up the development ladder.” produced in Victoria was introduced in January. The
royalty does not apply to the first 2,500 ozpa gold
produced.
























Kirkland Lake re-issued guidance
for 2020 at the end of June, with
production estimates of 1.35-1.4
moz gold, operating cash costs
of $US410-430/oz sold and AISC
$US790-810/oz sold. The impact
of COVID-19 protocols is expected
to be offset by the suspension
of operations at Holt Complex,
Ontario, as well as the impact of a
number of company initiatives and
changes in market conditions






Page 26

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DIGGERS & DEALERS PREVIEW


Kalamazoo reaches for the stars




by Mark Andrews


aul Adams has had to act quickly since joining Ashburton is considered a transformational
P Kalamazoo Resources Ltd as non-executive project for Kalamazoo and with Adams leading
director and Ashburton gold project manager this the charge, the company has a good chance of
year. discovering its destiny sooner rather than later.
Having successfully built up the high-grade Adams successfully turned the 30,000oz of
Penny West project (799,000t @ 13.8 g/t gold gold Spectrum Metals had at Penny West into
for 355,500oz, including 569,000t @ 16.8 g/t 355,000oz over nine months and 30,000m of
for 306,800oz at Penny North) for eventual sale drilling.
to Ramelius Resources Ltd for $200 million this Initially, Adams will have a budget of about
year, Adams wasn’t expecting to be boots-on- $3.25 million to spend on Ashburton, with RC
ground in Western Australia’s Pilbara in 2020. drilling planned for November/December before
“Again, it was right time, right place,” Adams breaking over Christmas to ponder results and
told GMJ in light of Kalamazoo completing returning to the field in March.
the acquisition of the Ashburton project from Paul Adams With Rolfe onboard, Kalamazoo has the intel to hit
Northern Star Resources Ltd. the right spots from the outset and Adams hopes
“As far as our WA projects are concerned, this to have 2-3 moz gold defined at Ashburton in the
has put us there in terms of resource and we next 12-24 months.
need to work hard and quickly to put value into From there, more than one development option is
the project. We have subsequently found out that being considered by Kalamazoo.
there was at least one other party gunning for that
“The requirement to perhaps build a POX plant
project quite hard.”
on site; we’re actually not wedded to that. There
Northern Star’s rise as multi-mine producer saw are a number of ways of skinning this cat and it
Ashburton fall down the pecking order, but only may well just be that the lower capex, lower risk
after a resource of 1.65 moz gold @ 2.5 g/t, with gold float concentrate option could be the key to
541,000oz in the indicated category, was defined. unlocking the sulphide portions of this deposit,
A payment of $5 million is due to Northern Star which are substantial and we reckon we can
from Kalamazoo when the first 250,000t of ore grow them,” Adams said.
in mined at Ashburton, while the former is entitled “We are allocating several hundred thousand
Margy Hawke
to a 2% NSR on the first 250,000 ozpa produced of dollars to do a major metallurgical [test work]
and a 0.75% NSR on any subsequent gold programme so we know what we are dealing
produced from the tenements. with and then we can start to talk to people. The
There is a pre-existing 1.75% royalty on gold interesting thing is that we have already been
production from Ashburton (excluding the contacted by a third party who years ago already
first 250,000oz), with all heritage and mining identified the Ashburton gold project as a potential
agreements with Native Title parties in place. source of high-grade concentrate.
The solid platform Adams has to work with at “That party has gone out independently and
Ashburton has been further consolidated with has all the contacts in the industry in respect
Matthew Rolfe, formerly of Northern Star, and Dr to marketing high-grade concentrate. He has
Margy Hawke onboard as senior geologists with already run his rule over the project, so there
Kalamazoo. are people out there that have identified the
“Matt has lots of ideas and has looked at the potential for this project to produce high-grade
property for a very long time and formulated all concentrate.”
these theories and targets. Margy on the other Matthew Rolfe While Adams takes care of the WA-based
side is the absolute intellectual equal to Matt, but projects, the company has welcomed Novo
can look at it with a new set of eyes, so between the two of them we Resources Corp to participate in the Queens project in Victoria. An
think we are going to get an optimal drilling solution and that was the option to earn an initial 50%-interest, followed by an additional 20%
basis for bringing the team together in that structure,” Adams said. and potential JV in Queens, subject to conditions, has been granted
“We’re assimilating the data into our own database management to Novo by Kalamazoo. The Queens project and greater Malmsbury
system at the moment as we are starting to put together our targeting goldfield area has known gold endowment and is considered
for the drilling, which we hope to start in Q4 this year.” prospective for high grade Fosterville-style mineralisation.


Page 28

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Page 29

DIGGERS & DEALERS PREVIEW




Wiluna’s latest resurrection




by Mark Andrews



rebrand, a new opportunity and a humming gold sector is million per month in operating
A what Milan Jerkovic has in front of him as executive chair of cashflow from the production of
Wiluna Mining Corp. 60,000 ozpa gold dore over the
Wiluna Mining, formerly Blackham Resources, was unveiled in next 12 months, as the start of a
June as the company looked to capitalise on prevailing conditions two-stage expansion programme
in the gold concentrate market at the 24.7mt @ 1.7 g/t for 1.4 moz begins.
gold (reserves) and 93.2mt @ 2.1 g/t for 6.4 moz (resources) Commissioning of the Stage 1
Wiluna mining centre. sulphides project (100,000-120,000
“The big thing that has changed to put us on the same page as ozpa sulphide concentrate and gold
some of the bigger producers is that the concentrate market has dore) is planned for September
gone from being 65% payable to 85% payable; that is the huge 2021, subject to board approval
shift,” Jerkovic told GMJ recently. for funding of the eight-year Milan Jerkovic
proposition.
“The gold price in concentrate market has given us an opening
that never existed for Bryan Dixon [former Blackham managing Stage 2 of the expansion will see output increase to more than
director] two years ago.” 250,000 ozpa gold in concentrate and gold dore from 2024.
Free milling ore from the Williamson open pit at Lake Way and To secure those plans, the company completed a $52 million
high-grade underground material from Golden Age keep the 2.1 capital raising earlier this year and locked in a three-year
mtpa CIL plant at Wiluna fed and are estimated to deliver $3-4 purchase-and-sale agreement for 70% or 122,500 dmt of gold
concentrate (whichever is greater) of Stage 1 production with
Polymetal International plc. Trafigura has agreed to take the
Dr Robert (Bob) Fagan remaining 30% in offtake.
B.Sc.,(Hons), Ph.D.,(UNE) Furthermore, a strategic alliance was also formed and will see
Polymetal act as an agent for up to 100% of Wiluna concentrate for
the expanded Wiluna Stage 2.
“Polymetal is building the world’s largest pressure leach plant on
the coast of Russia to actually catch concentrate from the Pacific
region. They came to us and identified us as one of the largest
orebodies that can supply feed into their long-term facilities,”
Jerkovic said.
“They know how to operate pressure leach plants and their power
costs are a third of ours and shipping concentrate is not a huge
cost. We will never compete on power costs with them the way
Australia is going and they will always have that advantage, which
is quite significant as pressure leaching needs a lot of power. We
have a strategic alliance with them to look at bringing more volume
as there are a lot of stranded deposits around Wiluna.”
Jerkovic estimated there were about 26 deposits within 100km of
Wiluna’s facilities that did not have processing solutions.
This digital text or course is designed for first year geology
students, prospectors, mining personnel, teachers, Therefore, with the free milling plant at Wiluna potentially idle in
engineers, bureaucrats, financial analysts, journalists, three years’ time, discussions and MoUs regarding the use of the
corporate executives, managers and other professionals facility are being entertained by Jerkovic.
needing a full & comprehensive overview of geology, what “Once we do the full sulphide construction of the 1.5 mtpa crushing
geologists do and how to understand & make productive
use of this information. milling circuit, the free milling circuit will be sitting dormant. We will
Downloadable $US100 then look at our own free milling ore we haven’t developed for a 2
mtpa plant,” Jerkovic said.
With an additional 20 chapters on prospecting & small-scale mining. Activate
the web page link now for more details & to download an example chapter.




Page 30
Page 30

Stage 1 expansion plans at Wiluna will see production of
100,000-120,000 ozpa sulphide concentrate and gold dore



To kick-start Stage 2 expansion plans, the company hopes to be drilling
to a depth of 1,200m in the next 12-18 months























“Right now, for Stage 1 in October next year we need the [750,000 support are we going to need? That question is six months away,
tpa] crushing milling circuit to supply the concentrate in the first once we get some more results on the board,” Jerkovic said.
instance.” The company expects to announce a reserve upgrade by the end
Wiluna’s share registry is heavily weighted towards institutions of the year, as construction of the Stage 1 expansion is planned to
(70%) which are championing an aggressive approach to start in January.
exploration and development, while Mercuria Energy Trading Pte “Those two reserve upgrades are to support the mixed range of
Ltd is on board to provide debt for the company’s expansion plans. debt funding to put out in the financial model. The second reserve
“The capital here is not the challenge; it is the plan that is the is about funding Stage 2 and doing a feasibility with the guys we
challenge. We already have a funder in place for Stage 1 and have, or we may do it with someone else,” Jerkovic said.
Stage 2 from a debt perspective. We have a flexible arrangement Four gold systems have been defined on the company’s 1,600sq
with them and can drawdown $21 million and another $40 million km ground holding in the region.
maybe if we need more,” Jerkovic said.
Despite Wiluna being in one of WA’s richest gold belts, the recent
“We just need to take a new financial model once we have the history of companies in the region hasn’t been good.
new reserves and then decide the volume and tenor; it is a simple
And, coupled with some of the disappointments in the State’s gold
prepaid loan. We deliver them gold over four years, and they give
sector in the past two years, Jerkovic is aware of the work ahead
us $40 million and take a fee upfront, there is no magic to it and it is
for his $175 million market capped company.
pretty straightforward.
“We come from that space, but ours is a different story. The biggest
“Even though you don’t have to put hedging in place with those
advantage we have – while we are a sulphide orebody – is that we
facilities, it acts as our risk management to protect cash flow to get
have scale on our side. We actually don’t have to define the scale
through the high expenditure.”
we just have to drill it out,” Jerkovic said.
Underpinning Wiluna’s expansion plans will be an increase to the
“A lot of those orebodies aren’t bad, they have managed to stabilise
resource/reserve base from the current 4.6 moz gold @ 3.65 g/t,
them, but their challenges are resources and reserves; we don’t
with an initial target of adding a further 200,000oz @ 5 g/t.
have that challenge. The other big difference is actually producing
A 50,000m drilling programme “under the headframe” has a concentrate in a large-scale mine which is shallow is not that
delivered for Wiluna and a resource update is imminent. hard; it is simple. Some of those other orebodies, when they go
“We are spending $30 million on drilling at the moment, we will underground, have resources but they have to chase them.
probably get it up to $60 million. The next question will be how Whereas we’re going to have much more shallow volumes to mine
much can we actually fund from our cash flow and how much to meet our requirements.”


Page 31
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DIGGERS & DEALERS PREVIEW



Meteoric overcomes




data dilemma


















by Michael Washbourne











Meteoric has started drilling at its newly acquired Palm Springs
eteoric Resources Ltd managing director Andrew Tunks gold project in WA’s Kimberley region
Mhad a very important task for his geology team during the
initial stages of the COVID-19 lockdown.
g/t from 56m and 50m @ 3.1 g/t from 50m – below the pit.
With the company looking to beef up its portfolio of Brazil-
Another hit of 73m @ 2.26 g/t from 169m was also recorded
focused projects with an Australian asset, Tunks assigned
just 100m south of Butchers Creek.
the homebound geologists up to 20 paper sections from
historic drilling on a prospective project. Each result was to The project also includes the Golden Crown deposit which was
be converted into digital form so the Meteoric board could the first resource ever defined by Northern Star Resources
appropriately assess the merits of the acquisition opportunity. Ltd back in 2007. Meteoric is expected to follow up on this
prospect in next year’s drilling efforts.
It proved to be time well spent as the board ultimately
approved the proposed move on the Palm Springs gold In a strange case of serendipity, Meteoric initially ran the
project in Western Australia’s Kimberley region. ruler over Palm Springs in early 2019 at the same time it was
considering – and ultimately acquiring – both the Juruena and
“A lot of people have looked at this and they all struggled with
Novo Astro gold-copper projects in Brazil.
the data,” Tunks told GMJ.
“We liked the look of it and we had a little dabble with it at that
“The biggest issue is that there is simply no digital data, it’s
time, but then Brazil caught our eye and we just didn’t have
all on old paper logs, so it’s a really hard one to evaluate.
the bandwidth back then to do both,” Tunks said.
Historically you can see there’s some really interesting
stuff there. And it’s also in rocks that I personally know well “So, we went with Brazil and we don’t regret that decision at
because my PhD area is not far away.” all. But when this one came up again, it was still available, so
we had another look and thought it was too tantalising this
Meteoric acquired Palm Springs from Horrocks Enterprises
time around to say no.”
Pty Ltd and Kimberly Resources Ltd for $1 million – $750,000
cash and 12.5 million shares – in June and drilled its first hole Meteoric’s maiden drilling programme at Palm Springs will
into the project in late August. comprise about 6,500m (5,000m RC and 1,500m diamond)
targeting high-grade ore zones under and to the south of the
The Palm Springs licence covers more than 12,000ha and
Butchers Creek pit.
contains more than 60 known gold occurrences over a 20km
strike. A key feature of the project is the historic Butchers Experienced geologist Tony Cormack is overseeing the
Creek open pit which produced 52,000oz @ 2.1 g/t gold programme.
during the late 1990s. “What we’re trying to do with our first programme is go back
Previous explorers also reported several high-grade and replicate some of the old drilling and statistically compare
intercepts – including 68m @ 2.5 g/t from 44m, 19m @ 8.8 it,” Tunks said.


Page 32

“We’ve also got a lot of ideas about Despite some of the lockdown
exploration upside but admittedly challenges in Brazil, where the impact
at the moment we’re concentrating of COVID-19 has been significantly
on rehabilitating the Butchers Creek greater than elsewhere in the world,
resource…there’s ore in the bottom of Meteoric has managed to push ahead
the pit, for sure. with drilling at Juruena.
“They were trying to do this at a gold First results from that work included
price of $US500/oz and I think they Andrew Tunks the best copper grades recorded
had an AISC of around $US550/oz, on the project in an intercept which
so they were losing money with every returned 9m @ 15.6 g/t gold and
ounce they produced. They just couldn’t continue it, so they 1.5% copper from 100m (including 6m @ 21.6 g/t gold and
packed up shop and never got back there. For us, we feel 2% copper from 101m), along with a potential new style of
like someone has come in and pre-stripped past the orebody.” mineralisation observed in the same hole.
Suggestions the best part of the orebody might still be in the Another drill hit of 3.4m @ 10.1 g/t gold from 392m was
ground at Palm Springs have seen some analysts liken it to also returned below the current resource at the Dona Maria
the Bellevue gold project, albeit on a much smaller scale. prospect.
While such comparisons are welcomed, Tunks is not getting “On the back of positive results at the end of this programme,
carried away and has implored his team to remain focused we would look to re-establish and update the resource,”
on undertaking more sound geological work in both Australia Tunks said.
and Brazil. “We feel there was a lot of peripheral material that was never
To that end, Meteoric has now disposed of its Midrim and included in the last resource and so this drilling programme
LaForce nickel-copper projects in Canada but will retain was predicated around converting inferred to indicated and
upside to any future exploration success on those non-core testing a few new areas.”
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Page 33

DIGGERS & DEALERS PREVIEW
















Building



towards




brilliance





Consolidated gold production of between 370,000oz and
410,000oz at an AISC of $1,360-1,510/oz is guided by St Barbara
from its Leonora, Simberi and Atlantic Gold operations in FY2021.
by Mark Andrews Sustaining capex of $97-115 million, plus growth capex of
between $49- $57 million is also the forecast for the same period.
Pictured is Kate McKenzie at the Atlantic Gold operations

nder Bob Vassie’s five-year reign, St Barbara Ltd $128 million and cash flow from operations of $280 million,
Utransitioned from struggling miner to leading diversified giving St Barbara cash at bank and term deposits totalling $406
Australian mid-tier gold producer. million (June 30), which was used to pay down debt to $107
Now Vassie’s replacement as managing director and chief million at the end of July.
executive, Craig Jetson – formerly executive general manager, A fully franked dividend of 4c/share was returned to shareholders
Cadia, Lihir and global technical services for Newcrest Mining who would be pleased that the Gwalia extension project and
Ltd – has mapped out the company’s next course of action: integration with Atlantic Gold had been completed.
Building brilliance. The Atlantic Gold acquisition was further consolidated recently
“We have a view about how to connect all our operations, where with St Barbara’s wholly-owned subsidiary, Atlantic Mining
the value leakage and where the underperformance is. There NS, cleaning up Moose River Resources for full control of the
is so much untapped value in St Barbara from a brownfields Touquoy gold operation (FY2020: 106,663oz) and surrounding
perspective and I am quite encouraged by what is in the tank,” tenements.
Jetson told GMJ from his current base on the Sunshine Coast. The $61 million cash deal offered for Moose River was funded
“We have recruited exceptionally well, changed a few people from St Barbara’s existing bank and boosts the company’s
and added three GM-level females into the organisation; exposure in the Moose River Corridor and more broadly in Nova
diversity and inclusion is something that I am passionate about Scotia.
and we’re morphing into the next level of thinking around that. “Sitting back as bench coach for the last couple of months
“I am certainly going to be able to come out in a few months’ has enabled me to have a look at the entire company, get my
time and say, ‘this is the new St Barbara brand, and this is how mind around Moose River and allowed me to negotiate a good
we are going to grow’.” outcome there where we own 100% of that facility plus the
Jetson has hardly been presented with an ideal scenario to growth and development potential there,” Jetson said.
start as St Barbara’s main man and while he told GMJ about “Earlier in the year I spent a couple of weeks at Simberi before
the frustrations of doing things during an uncertain COVID-19 my travel permit was removed [for COVID reasons] to get an
environment, he said the situation was “not all bad”. understanding of what I need to do there.”
“Lockdown is certainly not ideal, but I am in no position to A $5.4 million feasibility study and ESIA on the Simberi sulphide
complain. Our business has been struggling in many ways, but project is expected to be completed in December, with the
safety has been good, production has been good, costs have company hoping for a somewhat seamless decision to proceed
been OK, and I have a great team around me,” Jetson said. by Q3 FY2021.
FY2020 was highlighted by EBITDA of $339 million, NPAT of The updated sulphide PFS released in March on Simberi


Page 34

estimated the project components totalling 1.76 moz @ 2.4 g/t and 3.69 moz @ 1.6
could produce 1.8 g/t, respectively.
moz gold over 13 Exploration at Simberi and the acquisition of Atlantic were
years at AISC of about pivotal in St Barbara’s group reserves increasing significantly in
$US920/oz for a capex the past 12 months to 6 moz gold and 11.6 moz gold contained
of $US130-150 million in resources.
(payback of four years).
“We are very optimistic about moving along the Moose
The current mine River Corridor; we still have a great exploration portfolio and
plan at Simberi sees opportunities in interesting ground that we need to prove up,”
oxide processed Jetson said.
until FY2022, with
“I have changed the
the transition into an
internal accountability
operation that produces
for exploration and it is
sulphide concentrate
no longer a region-by-
made more appetising
region strategy. We have
by the existing airport,
a GM for exploration
power station, village
Doris Turburat at St Barbara’s and wharf to be who has a PhD in
Simberi operations, PNG leveraged from on the Geology and he has
taken a global view of
island.
where we are exploring
Meanwhile, the SAG mill at Simberi will be incorporated in a new and a primary goal of
flow sheet so that oxide and sulphide ores can be processed replenishment followed
separately. by orebody knowledge Executive general manager mining,
people, Val Madsen has been
St Barbara’s FY2020 updated ore statement indicated Simberi and then expansion
instrumental in driving diversity at
was host to 31.1mt @ 2.1 g/t gold for 2.1 moz (reserve) and and greenfields
St Barbara
91.3mt @ 1.4 g/t for 4.3 moz (resources), with the sulphide opportunities.

















X-ray tomography with

fluorescence — visualising
shear hosted lode-style gold




Get in touch:
[email protected]
+61 8 9469 2900
orexplore.com













Untitled-1 10 09/09/2020 08:31
Page 35

DIGGERS & DEALERS PREVIEW



“He has split the prioritisation and ranking of our projects, which has “Being WA and PNG-centric then expanding into Canada has
come together quite nicely and I think there is some interesting action created a lot of market interest in us. The opportunities are starting to
in the junior space.” come to us and makes jurisdictions deep in South America or Africa
Exploration expenditure for FY2021 will be $30-35 million, with in particular, more problematic in terms of what the business needs
Jetson open to more partnerships on earlier stage projects. right now,” Jetson said.
“When I look at the next transformation part of our business, it is St Barbara’s all-female truck crew at Simberi. Pictured is Serah
going to involve JVs. Whether that is a small JV close to Gwalia to fill Lawat, Roselyn Leto, Olivia Pikene and Hanshaine Gasoreng
the mill or exploration JVs like with Alice Queen Ltd at Horn Island,”
Jetson said.
“It may also be that we get serious with another organisation in
terms of JV’ing and buying something that is quite significant for our
business. These are all development opportunities that are on the
table for us, nothing is off the table.”
Now that Gwalia is returning to higher levels of material movement
after completion of the extended ventilation shaft, a paste aggregate
fill plant study has been started, coupled with the consolidation of the
Atlantic Gold operations, St Barbara can explore growth more freely.


It was a good time for Craig Jetson to be starting as managing with doing the right thing. But, now when we look at it, we know
director and chief executive of St Barbara Ltd on February 3, full well that the next version of diversity and inclusion is how you
with the company on its way to being anointed Employer of connect that with the safety of people and safety of our operations,”
Choice for Gender Equality for the sixth year running. Jetson said.
Out of the 119 organisations receiving citation by Workplace A recent audit on how certain or specific genders felt in regards
Gender Equality Agency (WGEA), St Barbara was the only mining safety at work and travelling to and from work, highlighted areas for
company featured. St Barbara to focus on.
It is testament to St Barbara’s commitment to setting and achieving “I think that is the next improvement piece in diversity and inclusion
targets of greater representation of women across the company, and I guess it is the shadow we have over our industry. Once we
particularly in leadership and board positions, which has seen the start moving away from genuine diversity hurdles – and I think we
overall pay equity gap within the organisation substantially reduced are there – that is when you have to start asking the question: Why
since 2007. aren’t companies equal to our standards or better?” Jetson said.
There is currently a nil gender pay gap in like-for-like roles at St “I think the industry can learn from St Barbara and we are on our
Barbara. next launch plan around diversity and inclusion and connecting
Jetson said St Barbara’s industry best practice for parental leave into the safety of our people; that is mental safety, health safety,
and return to work provisions, and special paid leave for domestic transiting to and from work. We have Papua New Guineans
violence victims will be maintained as a bare minimum, as he looks transiting to work and we want to know if they are comfortable us
to raise the bar even higher. supporting them going home. People from Gwalia walk 5-6km
home for exercise; do they feel OK about that, is that OK, do they
“St Barbara wants its interactions to be about its culture, people of
have a safe workplace from a gender equality perspective? That is
diversity and inclusion; all the WGEA-type recognition that comes
the next uplift in standards that we will pursue.”



























Craig Jetson

Page 36

Striking a pose



in Southern Cross





















by Michael Washbourne



Ask your standard retail investor
to name the most prolific gold
districts in Western Australia and
it’s unlikely you will find many who
list Southern Cross among the
first five, even though the region
has produced more than 12 moz
since the turn of the last century.




t is a challenge that Paul Stephen has learned to embrace good standing,
Isince taking the reins of little-known TSXV-listed explorer and the timing is
Altan Rio Minerals Ltd last year. And that’s not just because now right to bring
there is an easy explanation as to why Southern Cross is often them to market.”
Altan Rio chief executive Paul Stephen
overlooked by investors seeking out the next emerging gold While April 2013 is at the Pilot mine
story. often remembered
“It’s been an interesting experience for me because, yes, for having the biggest single-day fall in the gold price, it was
investors generally aren’t aware of it, but when you start naming also a watershed month in the recent history of Southern Cross
some of the mines in the area – the Yilgarn Stars, the Marvel with Chinese-backed Hanking Gold Mining Pty Ltd acquiring
Lochs, Copperhead, Golden Pig, Fraser – people in the mining the mothballed Marvel Loch assets from a struggling St
industry almost always go ‘oh, I remember that mine and how Barbara Ltd.
profitable it was’,” Stephen told GMJ. In an eerie coincidence, St Barbara itself had taken ownership
“I do feel it’s been very overlooked from an investor of the Marvel Loch mines and processing plant, 35km south of
perspective, but the reality is investors haven’t really been the Southern Cross townsite, almost a decade earlier following
given the opportunity to deploy funds into Southern Cross the collapse of Sons of Gwalia.
until now. There’s no question the majority of the belt, certainly Hanking revived the operation and poured first gold in early
south of the town of Southern Cross, is in the hands of private 2015, but was ultimately forced into a sale just two years later
investment out of China. And the majority of the ground to the after its plans to list on the ASX were vetoed by the Hong Kong
north of the town, for a long time, was held privately by our Stock Exchange which hosted its parent entity.
chairman John Jones.
Another Chinese-backed group, Barto Gold Mines Pty
“Those of us that have been through the commodity cycle Ltd, is now the owner-operator of Marvel Loch and while
remember clearly the lack of enthusiasm for gold from 2013 to the refurbished 2.2 mtpa plant continues to tick over, it is
2016 and I think it’s important to remember that raising funds for understood to be hungry for more feed. Ramelius Resources
gold exploration and drilling during that period was extremely Ltd’s Edna May operation hosts the only other active gold mill
difficult. So, the view was taken to keep these tenements in

Page 37

DIGGERS & DEALERS PREVIEW


within a 150km radius of Southern Cross. incorporating Barto’s M77/1049 tenement (including Pilot) and
Altan has emerged as a potential future supplier of third-party the equivalent or greater part of Altan’s surrounding P77/4341
ore after entering into an exploration and mining agreement with permit.
Barto over the historic Pilot mine which Stephen believes could Altan will meet all costs associated with exploration,
be the catalyst for unlocking a series of stranded production development and mining activities at its sole discretion with no
opportunities north of the Southern Cross townsite. minimum expenditures required. Profits from any future mining
“In signing this joint agreement, we have the ability to define and processing via the Marvel Loch processing facility are to be
resources and reserves at Pilot and the opportunity to then shared on a 50:50 basis.
bring them into production without having to build a standalone No exploration work has been carried out on the Pilot licence
mill,” Stephen said. since Troy Resources Ltd ceased mining there in 1994.
“This is an enormous opportunity for the company to create Stockpiled ore adjacent to the open pit looms as a possible first
something whereby we can self-fund exploration on an area option for toll-treatment at Marvel Loch.
that is just desperate for a serious exploration spend. Stephen said his company was keen to drill under the mine
“One of the things that is holding a lot of junior companies back, to test its high-grade potential at depth. Pilot was originally
despite these great markets, is undercapitalisation. Balancing developed as an underground operation by a subsidiary of
up issuing new shares and diluting existing shareholders with Western Mining before Troy took over and recovered almost
getting work done on the ground is always the challenge for 30,000oz gold from the open pit.
junior explorers. If we can put ourselves in a position where “There’s some spectacular grades from historical drilling going
we can fund a substantial exploration programme through the back to the 1950s which we need to follow up,” he said. “We’ve
development of cash flow by partnering with a local mill, that’s got to get the drill rigs back in there and turn that into what
a really unique opportunity and something that gets us very should be our first maiden resource.
excited.” “We’ve got what we think is the best compilation of all the best
Under the terms of the five-year agreement signed in late historical data and drill logs. We think we’re in a very unique position
June, both parties have defined an area of mutual interest to accurately target some of the extensions to these mines.”



Companies with ground in
and around Southern Cross
Altan Rio Minerals Ltd
Barto Gold Mining Pty Ltd
Bullseye Mining Ltd
Classic Minerals Ltd
Enterprise Metals Ltd
Firefly Resources Ltd
Torque Metals Ltd
Valor Resources Ltd
Xantippe Resources Ltd

Southern Cross production history

Deposit Output (oz) Grade (g/t)
Copperhead 932,256 3.75
Corinthian 58,200 5.9
Pilot 40,700 4.15
Hopes Hill 93,280 1.8
Golden Pig 692,219 6.05
Fraser 748,294 4.76
Marvel Loch 2,298,887 2.5
Nevoria 662,198 3.74
Yilgarn Star 1,265,737 4.51
Great Victoria 368,212 2.74
Bounty 1,100,000 5.7

Altan Rio chairman John Jones

Page 38

company,” Stephen said.
“Greg has been nothing but
remarkable since coming on board.
He’s coordinated our last two
drilling programmes and he’s been
responsible for some very successful
targeting along this belt. It’s a small
team within the company, but we
all share in the same belief that we
have an incredible opportunity on our
hands here at Southern Cross.”
Altan also appears to have overcome
Altan Rio holds 15 prospecting licences north of Southern Cross a major hurdle which impeded
previous explorers in gaining access
to untested tenure which sits on
Stephen, who joined Altan in early 2019 after more than a
granted farmland. One of the priority targets immediately north
decade with Brazil-focused Crusader Resources, has quickly
of the historic Golden Pig mine will be drilled later this quarter
come to realise that one of his new company’s most valuable
following the upcoming harvest.
assets is the 25km of strike it holds to the north of the Southern
While a potential listing on the ASX is a consideration, Stephen
Cross townsite.
said the company had no plans to abandon its Canadian
It has taken the best part of 12 months to put into motion, but routes, pointing to the success of Australian-focused Kirkland
Stephen is now confident the company is ready to sink the drill
Lake Gold Ltd and Novo Resources Corp as the prime reason
bit into its five most promising targets – Pilot, Aries, Paddocks, for sticking to the TSX-V.
Golden Pig North and Glen Innes.
“We’re seen some of the big Canadian investors like the
“We often get asked to rank our first five nominated targets
Sprotts and Dundees of the world coming into WA gold projects
and one of our biggest challenges, for different reasons, is that
and really been the drivers of those companies’ successes,”
our No.5 target is equally as prospective as our No.1 target,”
he said.
Stephen said.
“Canadians tend to be first-mover investors, so we see being
“I think there are people who have been looking at this package
listed over there as an opportunity to access those Canadian
and seen the merits of it for a long time, so now having it in
investors who are looking for opportunities in Australia, and
a vehicle where we can actually fund not only the immediate
specifically in gold.
exploration but future exploration is incredibly exciting. We’re
“You can currently buy a share in our company for a very
in a situation now where all of the preliminary work has been
low market capitalisation; there are very few comparable
completed and it’s now just a case of getting drill rigs out there
opportunities on the ASX at the moment, certainly not in this
and proving it up.”
quality of exploration tenure with this many targets defined.”
Altan was recently awarded EIS co-funding by the WA
Government to drill the Aries target
which has not been touched since Greg Wilson gives an overview of the Glen Innes prospect
2004 despite a historic intercept of
12m @ 4.51 g/t gold being recorded
at the time.
Alongside the 15 prospecting
licences the company holds, Stephen
considers the people behind Altan,
including industry veteran Jones
and vice-president exploration Greg
Wilson, to be equally as valuable.
Kalgoorlie-raised Jones rose to
prominence during the nickel boom
of the 1970s, while Wilson is credited
with discovering more than 4 moz
across various Archean settings.
“We can talk at length about Jonesy’s
success in the mining industry, both
recent and historical; his prospecting
prowess is a huge asset to the


Page 39

The quiet achiever:



True competition emerges


in the Australian precious


metals market





























our strategy is to carefully select partners who share our
vision of efficiency, sustainability and supply chain integrity.
“Not being constrained by legacy systems, we champion
the Australian gold sector globally by investing in the best
people and utilising the latest environmentally sustainable
technologies. And our strategic location in Australia’s largest
Mining partner. Market innovator. trading hub provides significant logistical advantages to our
Market disrupter. Monopoly buster. partners in both domestic and international markets.”
It is these factors that enable ABC Refinery to bring real
These are all labels that ABC Refinery, the refinery arm of competition to the market and significant bottom line
Australasia’s largest independent precious metal services group refining and transport savings to its partners.
Pallion welcomes. ABC Refinery and its parent company Pallion operate across

Gold processed at ABC Refinery currently accounts for 25% of the entire value chain of precious metals from refining mined
the Australasian market, while the silver component equates dorè to bullion trading to producing jewellery for global
to 70% of the market in the region. And in FY2021, ABC jewellery houses. That position is a unique one – not just
Refinery is expected to process about 100 metric tonnes of locally, but globally.
gold and roughly 500 metric tonnes of silver. Indeed, the strong demand for ABC Bullion branded precious
These are significant numbers – especially in the context of a metal supports all of Pallion’s subsidiaries.
market that was dominated by one monopoly player for over As Woodford explains: “Demand starts with ABC Refinery’s
20 years. rapidly increasing share of the Australasian market in
“We pride ourselves on having brought true competition to unprocessed precious metals from mining companies. In
the Australasian market. We like to say that we have brought turn, this is supported by strong demand throughout the
‘optionality’ to the Australian precious metal mining sector,” region for ABC Bullion bars that are produced by ABC Refinery.”
Pallion chief commercial officer David Woodford explains. Accreditation by the likes of LBMA, SGE, COMEX, RJC, NATA,
And, while it is trite to say that when firms compete with each ISO, ILAC, IEC and Standards Australia are seen by ABC Refinery
other, consumers get the best possible prices, quantity, and as merely a base line in the broader commitment of ABC
quality service, ABC Refinery stresses another very tangible Refinery and Pallion to responsible sourcing – an increasingly
outcome: Partnership. necessary requirement not just at the consumer level but at
the broader wholesale and investment level as well.
“ABC Refinery is not just a service provider,” Woodford says.
“Our enviable rate of growth is driven by the fact that we “Our various accreditations demonstrate a threshold and
partner with our clients for long-term mutual benefit. Indeed, expectation of ABC Refinery to perform ESG at an extremely

Page 40

ABC Refinery

Fact File:



The refining division of Pallion,
Australasia’s largest independent
precious metal services group of
companies that has been involved
in the industry since 1951
Rapidly growing market share.
Currently refines approximately 25%
of Australian gold mine production
and 70% of silver production
Employs the world’s largest
environmentally friendly ALS™
refining capacity

Strategically located in Sydney,
Australia’s largest trading hub
Accredited by all major world
associations and exchanges including
LBMA, SGE, COMEX, RJC, NATA, ISO,
ILAC, IEC and Standards Australia.





high level. But responsible sourcing is about more than just and produces no exhaust fumes. It also further improves the
accreditation. The commitment to responsible supply chains efficiency of ABC Refinery’s refining process as compared to
has to come from within,” Woodford says, in light of Pallion traditional competitor methods.
publishing its first ever sustainability report in respect of the Further to its environmental benefits, ALS™ refining
2020 financial year as part of its Considerate™ Precious Metals technology results in no precious metal loss, significantly
commitment.
improved speed of output and approximately 40% reduced
“ABC Refinery and the broader Pallion group have a real operative costs compared to traditional refining technologies.
commitment to responsible and sustainable sourcing and
production. So, if you are an end user of Pallion products you “Of course, these benefits are passed on to our mining clients
can buy knowing that we strive to adhere to best practice as part of our corporate ethos of partnership,” Woodford
along the entire value chain,” Woodford says. notes.
Complementing that responsible sourcing environmental
“The Considerate™ Precious Metals Report considers the whole
spectrum of the Pallion enterprise annually and reports on commitment are ABC Refinery’s developments in the
our corporate responsibility initiatives and their impact on our electronic tracing of metal inputs in-line with an emphasis
own people, society, charities, the environment as well as local from consumers on responsible sourcing and supply chain
and the global economies. The Report has been prepared in integrity.
accordance with the GRI (Global Reporting Initiative) to ensure “ABC Refinery has partnered with software company
our products are benchmarked at an international level,” he says. Blockhead Technologies to create a technology platform
that enables precious metal traceability and tampering
Technology and innovation are becoming increasingly detection called STAMP Vision™. STAMP Vision uses blockchain
important in assisting organisations with their ESG agendas technology to store bullion fingerprints in a way that ensures
and ABC Refinery is recognised as a global leader in that data integrity and that the fingerprints have not been
regard. In addition to its proprietary electrolytic gold refining tampered with,” Woodford says.
(EGR) technology that has improved speed of output as
compared to traditional EGR methods by approximately 30%,
ABC Refinery boasts the world’s largest environmentally
friendly ALS™ refining capacity.
The only refiner in the southern hemisphere to offer ALS™
refining to the industry, ABC Refinery utilises this ground-
breaking technology in its pre-refining process in order to
remove silver and light elements from gold-silver-copper
alloys using vacuum distillation technology. Unlike traditional
refining technologies, the process does not use chemicals


Page 41

DIGGERS & DEALERS PREVIEW




Tesoro’s darling




El Zorro




by Mark Andrews


xpecting the unexpected has been a theme many have
Ehad to run with in 2020 and the adjustments Tesoro
Resources Ltd has made are certainly favouring upside for
the company.
Original designs had a resource from the El Zorro gold
project, near Copiapo in Chile, being delivered by the
company by the end of this year.
However, the flawless strike rate of drilling is far exceeding
Tesoro’s expectations. Tesoro reports that drilling has doubled the size of the drilled
“Every drill hole drilled has delivered mineralisation; it looks mineralised footprint at El Zorro
like something special coming together. I can’t see us
stopping drilling from now until the end of the year and at
mineralisation continues in earnest with two diamond rigs
this stage everything keeps growing. Realistically, we are
operating 24/7 at Ternera.
going to stretch ourselves to release a resource this year
At the time of print, 26 holes for 6,910m had been completed
considering the size of what we have drilled to date,” Tesoro
with assays from 17 holes pending, while additional holes
managing director Zeff Reeves told GMJ.
are planned to further test the northern and southern extents
“We have tripled the footprint since the beginning of the year,
of Ternera as well as complete infill drilling for resource
and it will take some more time to drill it out. There is a step
definition.
change in the size of resource and something we aspire to
Reeves said results would determine whether to send more
is to change the economics of it as a mining operation and
rigs to site at El Zorro in Chile’s Region III, 10km from both
change the valuation of the company significantly. If there
the Pan American Highway and Pacific Ocean. A port at
was 500,000oz gold and we can easily see it becoming 1
Caldera is also 55km by road away.
moz we will continue pushing drilling.”
In addition to its 10,744ha at El Zorro, Tesoro has another
An intercept of 231m @ 0.83 g/t gold from 72m, including
400sq km of ground under application, while cash of $7
54m @ 1.69 g/t from 72m, 25m @ 3.36 g/t from 100m, 6.7m
million sees the company well-funded during what is a
@ 11.57 g/t from 118.3m, 24.3m @ 2.43 g/t from 193.3m,
modern-day gold boom.
13.26m @ 3.25 g/t from 204.34m, 3.66m @ 10.76 g/t from
204.34m and 15.9m @ 1.04 g/t from 248m confirmed the “We have seen some gold booms, but this seems like it is
large scale potential Tesoro is faced with at El Zorro. going to be fairly long winded. From our perspective we’ve
had some good luck and good management in terms of
Following that announcement, visible gold was reported
listing because we only just got the initial RTO transaction
over 61m of drill core within a wider zone of 117m “of strong
done at the beginning of the year and stepped straight into a
veining and sulphide mineralisation”, which is typical of the
big gold bull market,” Reeves said. “The De Grey’s [Mining
gold-bearing zone at the Ternera prospect.
Ltd] and Musgraves [Minerals Ltd] of the world are getting
The result –15m @ 0.68 g/t gold from 115m, including 1m
institutional support and that institutional money points to
@ 5.64 g/t from 126m – was from the northern step-out hole
their long-term view, which seems pretty positive at this
ZDDH00042 within the El Zorro tonalite.
stage. Between the emerging project that is El Zorro and the
Importantly, the step-out holes are proving Tesoro’s medium-term outlook for the gold price, it is going to be a
exploration model is on-song with gold mineralisation pretty exciting 6-12 months for us.”
correlating well to IP geophysical anomaly and remains
At the time of print, Tesoro was trading at 26c/share with a
open both to the north and south.
market cap of $121 million. The company started the year
Although mining may have existed at one time at El Zorro, at 3c/share.
Reeves believes the company is unearthing a totally new
Visit PaydirtTV on YouTube for more on Tesoro’s
gold style – intrusive-related gold (IRG) – for Chile.
Chilean campaign.
Identification of causes of the intrusion and subsequent
Page 42

Boon for The porphyry gold-copper

discovery success at Boda
in NSW’s Central West,
Alkane’s where a 30,000m drilling
programme is progressing,
has catapulted Alkane’s
people standing in the market,
while its Tomingley gold
to
operations
continue
strengthen the company’s
by Mark Andrews balance sheet ($98 million
in cash, bullion and listed
investments as at June
lkane Resources Ltd has been recognised in the market 30).
Afor its exploration feats at Boda and gold producing
Gold sales for the June
capabilities at Tomingley, both in New South Wales, and now
quarter totalled 12,992oz
its team is benefitting from the success.
at an average price of
In mid-September, with the company trading at $1.41c/ $2,327/oz, which produced
share and boasting a market cap of $840 million, all eligible revenue of $30.2 million for Nic Earner
employees were issued with $1,000 worth of new fully paid the June quarter.
ordinary Alkane shares gratis.
Following the June quarter results, the demerger of the
The offer was made under Alkane’s Bonus Employee Share Dubbo rare earths project into Australian Strategic Materials
Plan to 161 eligible employees, with shares issued at $1.15c Ltd (ASM) was completed.
on September 11.
“People are very happy with what has gone on and a lot of
Alkane’s gesture to its employees was “in recognition of their value has been created. If you look at today’s share price it
contribution to the company’s success”, as it was preparing is equivalent to a 40c/share dividend in Alkane. It has been
for initiation on the S&P/ASX 300 Index.













729km of gold, Major Gold Discovery in Chile
2
base metal and  Defining the El Zorro Gold Project

lithium projects with  Drilling to Delineate the Large Ternera Target
 Regional Concession Holding
substantial history  District Scale Mineralised System
of mining  Successful Exploration Model
 Multiple 100g/m Intercepts & Expanding

 Poised for Growth





Zeff Reeves – Managing Director
+61 8 9322 1587 | [email protected]
www.tesororesources.com.au
TEM
:TS0
www.tempestminerals.com





Page 43

DIGGERS & DEALERS PREVIEW





























FY2021 guidance from Tomingley is 45,000-50,000oz gold
very positively received and now people are asking what
at an AISC of $1,450-1,600/oz
next?” Alkane managing director Nic Earner told GMJ in
early September.
and San Antonio (7.92mt @ 1.78 g/t for 453,000oz inferred)
FY2021 guidance from Tomingley is 45,000-50,000oz gold
deposits will be upgraded to indicated status in Q4 and from
at an AISC of $1,450-1,600/oz.
there Alkane can forge ahead with detailed mine plans and
Alkane has made a concerted effort to expand its exploration economic studies.
efforts regionally at Tomingley in the past two years and the
Tomingley is currently an open pit and underground operation
rewards have been significant.
aided by a 1 mtpa processing facility, with Alkane continuing
The Roswell (7mt @ 1.97 g/t for 445,000oz gold inferred) consultation over development approval for open cut and
underground mining beneath San Antonio and Roswell.
An approval to develop an exploration drive from the
Wyoming One deposit to Roswell has been received and
Alkane has prepared preliminary plans for open cut and
underground ventures at Roswell and San Antonio.
Meanwhile, infill drilling totalling 48 holes for 13,000m had
Excellence in been completed at Roswell and San Antonio, with depth
extensions at Roswell confirmed with intercepts about 80-
Exploration 100m below the base of the previously defined inferred
resource.
Ÿ Drilling in progress to test high grade Alkane sees potential for the system to extend to depth, with
Ni-Cu-PGM at Broken Hill, NSW.
significant intercepts at Roswell including 13m @ 6.17 g/t
Ÿ Significant porphyry copper-gold target at gold from 484m, including 5m @ 11.5 g/t from 488m and
Apsley along trend from the Boda discovery 2m @ 3.84 g/t from 519m at RWD037. Meanwhile, results
(Alkane Resources Ltd).
from RWD039: 16.5m @ 4.74 g/t from 483.8m, including 1m
Ÿ Large tenement holdings in the emerging @ 21 g/t gold from 489m and 3m @ 13.2 g/t from 494m
Ni-Cu-PGM province of SW WA and in the and RWD040: 22.1m @ 5.96 g/t from 534.9m were other
Blackridge gold field QLD. highlights at Roswell.
BOARD OF DIRECTORS While Alkane elaborates on its growth potential internally,
the company has significant positions in ASX peers Genesis
Peter Unsworth Non-Executive Chairman Minerals Ltd (867,000oz gold at Ulysses in Western
Michael Jones Managing Director Australia) and Calidus Resources Ltd.
Paul Ingram Non-Executive Director Alkane upped its stake in Genesis from 14.56% to 19.9%
Markus Elsasser Non-Executive Director recently, while in July it retained a 12.7% interest in Calidus
by investing $3.2 million in the latter’s $25 million placement.
(08) 6454 6666 Calidus started construction on the 1.5 moz Warrawoona
impactminerals.com.au gold project, East Pilbara, in September and expects ground
activities to start in “earnest” in Q1 2021.



Page 44

Miramar



to float





by Mark Andrews



















fter bringing to market the most successful IPO of 2010 – Doray “Glandore was too small for a company like AngloGold, similar to
AMinerals – Allan Kelly (pictured) is back to replicate the feat with what Andy Well was for WMC. Glandore fits into Miramar and the
Miramar Resources Ltd. thing with our projects is that they are near to existing projects and
A best-case scenario will see Miramar minted by the start of Diggers there maybe a number of potential options for them,” Kelly said.
& Dealers after fulfilling an IPO with $5-8 million raised at 20c/share. Gidji is near Horizon Minerals Ltd’s 500,000oz Boorara gold
Although there are some similarities for Kelly 10 years on from his operation, while Glandore is along strike from Silver Lake’s Imperial/
first IPO – Shaw & Partners will again run the book for what will be Majestic deposits.
a West Australian gold-focused company – he believes his armoury Once listed, the company is targeting aircore/RC drilling at Gidji,
is better placed from the get-go this time around. where there is potential for extensions to the 314,000oz gold
“I reckon Gidji and Glandore are better than the stuff we had in Runway deposit, followed by lake drilling at Glandore.
Doray at the beginning,” Kelly told GMJ. Meanwhile, testing of auger anomalies at Lang Well, defining
“I had a history and a bit of an idea at Andy Well, but I think Gidji and drill targets at Garden Gully in the Murchison, at the same time
Glandore are more advanced and better looking than Andy Well as progressing other tenements in its widespread portfolio
was. The other stuff in Miramar is earlier stage, conceptual in nature, encompassing ground in the Gascoyne are Miramar’s aims in its
than the second-tier stuff we had in Doray, which had to take a back first year on the bourse.
seat and probably got underdone because the money and focus Joining Kelly at Miramar will be Marion Bush (non-executive
had to be on Andy Well.” technical director), Terry Gadenne (non-executive director) and
The attention afforded Andy Well saw Doray move into production, Mindy Ku (company secretary/chief financial officer).
which was followed by the company’s second mine in the “An IPO is an onerous process, probably a bit too onerous, but it
Murchison, Deflector. gives you a clean shell to start with and then it is up to you what
After offloading Andy Well and Deflector, which are both now happens from there,” Kelly said.
owned by Silver Lake Resources Ltd, Kelly ventured into the North “We have kept Miramar simple – WA gold, no-one’s been greedy
American/Australian gold sectors with Riversgold Ltd until he on the vend, and we have no legacy issues. People get focused on
resigned in March 2019. That meant by the time the 2019 Diggers the IPO; that is the pregnancy, the main game is bringing up the kid;
& Dealers arrived Kelly was ready to saddle up for another foray that is the way I look at it.”
into the sector. Despite the frustrations of getting an IPO off the ground, Kelly
However, as the gold sector was taking off, Kelly found a scarcity expects Miramar to be among a wave of new companies listing on
of available projects that interested him, and it was only in February the ASX.
that an opening appeared via the Gidji and Glandore projects. “I think there will be a flood of new companies and I think we have
Gidji is now subject to JV with Thunder Metals Pty Ltd the 20% got in ahead of the rest and hopefully we have the timing right on
free-carried partner to a decision to mine. Glandore, formerly of everything else as well,” Kelly said.
AngloGold Ashanti Ltd stock is also set to fly under the Miramar
banner.



Page 45

DIGGERS & DEALERS PREVIEW



IGO considers Tropicana clean-up



by Dominic Piper



GO Ltd has launched a strategic review into its share of the lingering for some time.
ITropicana gold mine in Western Australia as it considers its “That rumour has been doing the rounds for three or four years
options for its 30% stake in the mine. and is the most common question I get on calls,” Bradford
IGO managing director Peter Bradford announced the review said. “My consistent response is: ‘Tropicana as a gold asset is
on September 11, saying the company did not believe the not aligned with our strategy but it’s a high-quality asset so it is
project’s value was being fairly recognised in the IGO share core to our portfolio.’”
price. While there would be plenty of suitors for the 30% interest,
The strategic review will involve technical analysis of various Bradford is reluctant to sell the stake unless the buyer values
opportunities at the mine and explore divestment options it appropriately and there is something useful to apply the
such as full or partial sale “or other alternative transaction proceeds to.
structures”. “We shouldn’t take it for granted that it will always be in the
The launch of the review came six days before commercial portfolio but any sale would rely on a few factors; that the
production was declared by IGO and JV partner AngloGold market conditions are such that the value is understood and, if
Ashanti Ltd on the Boston Shaker underground mine at we do sell, why would we be doing it?” Bradford asked. “If it is
Tropicana. to return the proceeds to shareholders, is it not better to retain
The mine – completed on time and below budget – is producing the asset and produce a higher annual dividend?”
at a rate of 700,000 tpa and will ramp up to 1.1 mtpa by March He is also wary of selling the asset before its longer-term value
2021. At expected grades of 3.5 g/t gold, it should produce has been accurately assessed, hence the strategic review.
100,000 ozpa in full production. “Boston Shaker is coming into commercial production and
IGO was largely responsible for the discovery of Tropicana in there are two further underground prospects to fully test there
2005. A recent renewed focus on clean energy metals such as which means we are still only part way through the journey
nickel and copper fuelled speculation IGO was considering its at Tropicana,” he said. “And, there is the regional exploration
options for Tropicana. around Tropicana, where we are spending $10-11 million this
Speaking to GMJ prior to announcing the strategic review, year, three times what was spent last year.”
Bradford said the question around divestment had been

































Commercial production at the Boston Shaker underground
was declared in September



Page 46

Medallion on the IPO daisMedallion on the IPO dais









by Michael Washbourne


rivate entity ACH Minerals Pty Ltd will be rebranded as – a date which Bennett said was effectively the “line-in-the-sand”
PMedallion Metals Ltd later this quarter in what is shaping moment for ACH in its long-held quest to go public.
as the biggest resources IPO of 2020. ACH was formed in late 2015 by long-time business associates
A little more than four years after acquiring what was the Great Ian Junk, Darren Hedley and Tao Li with the specific objective of
Southern project near Ravensthorpe from Silver Lake Resources acquiring the Great Southern project from a struggling Silver Lake
Ltd for $5 million, ACH is seeking to raise at least $30 million to which at the time was up to its eyeballs in debt. With additional
list on the ASX and begin a proposed two-year journey to first backing from Chinese interests, the company has since spent
gold production. $16 million in the ground at both Ravensthorpe and Jerdacuttup.
Great Southern has since been split into two separate assets – Bennett said the company was sounding out several potential
the Ravensthorpe gold project and the Jerdacuttup polymetallic cornerstone investors for the IPO.
project – with the company focused on developing a standalone Long-serving Northern Star Resources Ltd director John
operation at the former. Fitzgerald will chair Medallion’s new-look board, alongside
Ord Minnett and New Holland Capital have been appointed joint industry veteran Tony James – who handed Bennett his first
advisors of the IPO process. mining job at Telfer back in 1994 – and existing ACH director Ed
A DFS completed earlier this year on Ravensthorpe forecast Ainscough.
average production of 61,000 ozpa – including peak output of With investor appetite for resources stocks on the rise, Bennett
79,000oz in year three – over a minimum 5.5 years. Capex is said the company’s decision to apply for entry to the ASX had
estimated at $85 million with an AISC of $1,203/oz. been vindicated, and an IPO was the best option on the table.
Speaking to GMJ ahead of lodging the official prospectus for “The feedback we consistently got was that an IPO was a faster
Medallion, managing director Paul Bennett was confident the route to the market than a RTO and in all of the scenarios we
funds raised from the upcoming IPO would be enough to underpin considered, we would have always had to re-comply with the
two years of exploration and pre-development activities at the listing process,” he said.
621,000oz project, about 17km south-east of the Ravensthorpe “Once we looked at a few of those options, it became pretty clear
township. that an IPO was a simpler approach and lower risk to our existing
“The objective of the exploration programme is principally to shareholders because they wouldn’t have to deal with residual
extend the known resources along strike and at depth, add to board and shareholder issues that sometimes come with RTOs.
the mine life, optimise the DFS and then consider a development “A trade sale was never really given much consideration, but it
decision,” he said. was always an option. Given the guys [Junk, Hedley and Li] are
“What we don’t want to do is run the cash balance down too low naturally project builders, they’re quite comfortable taking on
at the end of that two-year period. My expectation is that there will that risk and obviously they will be escrowed through this IPO
be a development decision in that two-year horizon and some process.”
new capital will be introduced to the business, perhaps a mix of Bennett said the company was likely to seek out a partner for
equity and debt, to fund project development. But if we don’t get its Jerdacuttup polymetallic project, indicating a group with the
to that point, there will still be funds to progress the increase in requisite technical expertise and balance sheet was needed to
the resources and an increase in the pipeline of pre-resource “push that asset along”.
targets.”
Jerdacuttup includes the 5.6mt Trilogy deposit discovered by
Environmental approval was issued for Ravensthorpe on July 21 Homestake Mining Company in 1997.



Page 47

DIGGERS & DEALERS PREVIEW
Comprehensive Supply Chain Solutions




FLOOR PLAN EXHIBITOR LISTING
2020 ADD Business Group 37 Clarke Energy 72 Kal Tire Mining Tire Group 96 Peel Mining Limited 20
Kalamazoo Resources
Como Engineers Pty Ltd
98
Perenti
40
97
10
Aggreko
DIGGERS & DEALERS Alicanto Minerals Limited 90 Curtin WA School of Mines 66 2 Kin Mining NL 133 Pilbara Minerals Limited 67
Alkane Resources Ltd
46
De Grey Mining Limited
Poseidon Nickel Limited
21
Kingwest Resources
E07
Limited
MINING FORUM ALS 53 Deloitte 7 Klohn Crippen Berger Ltd 43 Primero Group 65
Alto Metals Limited 56 Downhole Surveys 114 PYBAR Mining Services 109
Anglo Australian Element 25 Limited E09 Lefroy Exploration Limited 117 Ramelius Resources Limited 19
Resources NL 76 Emerald Resources NL 116 Legend Mining Limited 79 Rapid Crushing & Screening
AngloGold Ashanti Ltd 4 Encounter Resources Linkforce 124 Contractors Pty Ltd 1
Anova Metals Ltd E11 Limited 59 Liontown Resources Red 5 Limited 15
Limited 129
Antipa Minerals Ltd 104 Energy Power Systems Regis Resources Ltd 27
Australia (EPSA) 24 Lithium Australia NL 111
Apollo Consolidated Ltd E01 Rowe Scientific P/L 35
Evolution Mining 85 Lynas Corporation Ltd 47
Ardea Resources Limited 71 Rox Resources Limited 13
Fenix Resources Limited E05 Macmahon 83
ASX Limited 25 S2 Resources Ltd 81
FutureGold 55 Mader Group 132
Ausgold Limited 12 Sandfire Resources 134
Galan Lithium Limited E10 Magnetic Resources NL 91
Austin Engineering 28 Sandvik Mining and Rock
Galena Mining Limited 29 Matador Mining Limited 88 Technology 70
Australian Underground
Drilling Pty Ltd 5 Gateway Mining Limited 108 Matsa Resources Limited 31 Saracen Mineral Holdings
Limited 101
Australia’s Paydirt 8 Gekko Systems 3 Medallion Metals Limited 82
Auteco Minerals 125 Genesis Minerals Limited 107 METS Engineering 58 Saturn Metals Limited 34
Bardoc Gold Limited 99 Geological Survey of MICROMINE 61 SGS Australia Pty Ltd 48
BASF 138 Western Australia 87 Middle Island SO4 41
Gold Fields Australia Resources Ltd 64 Solgold plc 78
Bellevue Gold Limited 123
Pty Limited 131 Mincor Resources NL 42 SRK Consulting 84
BGC Cement & Lime 14
Gold Road Resources Ltd 115
BHP Nickel West 73 MineARC Systems 75 St George Mining Limited 112
Great Boulder Resources
Bis 106 Limited 128 Minerals Development Swick Mining Services 16
Victoria 33
Black Cat Syndicate Greatland Gold plc 127 Mining People Teck Australia Pty Ltd 52
Limited E15 The Perth Mint 95
Haines Surveys 68 International 113
Blackstone Minerals Hammer Metals Ltd E03 MiningNews.net 39 Tietto Minerals Limited
Limited E02 (Australia) 60
Hampton Mining & Civil 22 Moho Resources Ltd E08
Boss Resources Limited 126 Topdrill Pty Ltd 30
Hays Specialist Mount Gibson Iron Limited 38
Breaker Resources NL 9 Trigg Mining E06
Recruitment Pty Ltd 77
Bureau Veritas Minerals 11 HiSeis Pty Ltd 103 Musgrave Minerals Ltd 26 Troy Resources Limited E04
Calidus Resources Ltd 86 Horizon Minerals 57 Neometals Ltd 89 Venture Minerals Limited 45
Canaccord Genuity New Century Resources Venturex Resources
Limited 121 & 122 Hot Chili Limited 44 Limited 49 Limited E12
Capricorn Metals Ltd 92 IGO Limited 69 NRW Holdings 51 VM Drilling 93
Carey Mining 136 Image Resources NL 130 NTM Gold 50 West African Resources Ltd 23
Intertek Genalysis 62 Olympus Australia 32
Cazaly Resources Limited 119 Western Areas Ltd 94
Jervois Mining Limited E17 Optiro 118
Centaurus Metals Limited E14 Westgold Resources Limited 54
Jindalee Resources Limited 135 Ora Banda Mining Ltd 120
Chalice Gold Mines WesTrac Pty Ltd 102
Limited 18 K92 Mining Inc 137 Pantoro Limited 80
Wiluna Mining 17

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12535 MLG Paydirt Ad.indd 1 7/6/18 1:43 pm

AFRICA DOWNUNDER PREVIEW




African dreams




restart on ASX





by Dominic Piper































he ASX will likely welcome two new African gold explorers with North American investors – perhaps still spooked by the
Tbefore the end of 2020, a further sign the Australian board is security incident at Semafo’s Bongou mine in Burkina Faso
the bourse of choice for juniors active on the continent. in November 2019 – preferring Tier 1 jurisdictions, including
After a drought of African-focused IPOs, Sarama Resources Inc Australia.
and Megado Gold Ltd both announced plans to list in Australia The shifting sentiment has led Sarama to finally make its move,
during September. with the TSX-listed explorer announcing in September that it
Australian gold equities have enjoyed a stellar four-year period would be pursuing a dual listing on the ASX before the end of
relative to North American peers but until this year, Australian 2020.
investor sentiment was skewed towards domestic stories. “The ASX understands the jurisdictions better than the
Attitudes have changed in 2020, however, with share prices on TSX, which is much more Americas focused,” Sarama chief
a sharp incline over the last six months. executive Andrew Dinning told GMJ. “Plus, there have been
Established producers Perseus Mining Ltd (up 114% since several ASX successes in West Africa in recent times with West
March 16) and Resolute Mining Ltd (up 67% in the same period) African Resources the standout. Their success is great for the
posted strong earnings for FY20 and newly minted miner West industry because it gives everyone confidence projects can be
African Resources Ltd (up 158%) has barely put a foot wrong in successfully built there.”
its development of the Sanbrado mine in Burkina Faso. Dinning sees the move to the ASX as a natural one for Sarama.
Another developer, Cardinal Resources Ltd, is at the centre of a The company has always been headquartered in Perth and the
bidding war between Shandong Gold and Nordgold Inc which entire board is now Perth-based.
has pushed its shares up 200% in the period. “It is almost like coming home after 20 years in overseas
Even African-focused explorers are enjoying market support markets, so it is all a logical progression,” he said.
after a period out of the limelight, with Predictive Discovery Ltd Adding weight to the argument is Perth’s reputation as the home
(up 1,150%), Oklo Resources Ltd (up 110%), Chesser Resources of African mining technical expertise
Ltd (up 316%), Mako Gold Ltd (up 312%) and Tietto Minerals Ltd “If you look at the recent record of mine builds in West Africa,
(up 300%) all performing strongly. they’ve all been on time and budget and they’ve all had lots of
In contrast, TSX-listed African juniors are yet to be caught up in elements coming out of Perth,” Dinning said. “If you want good
the early waves of optimism washing over the Canadian scene African skills, Perth is the place to go, whether that’s companies,


Page 50