GMJ128-July-September-WEB_Neat

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17 October 2017
Pan Pacific Perth

Image courtesy of Western Areas Ltd

Presenters to date:

Jim Lennon Dan Lougher Eduard Haegel
Consultant Managing Director & CEO Asset President

Macquarie Group Limited Western Areas Ltd BHP Nickel West

Peter Bradford Ian Mulholland Carey Smith
Managing Director & CEO Managing Director Senior Analyst

Independence Group NL Rox Resources Ltd Alto Capital

John Prineas Mark Wilson Warren Hallam
Executive Chairman Managing Director Managing Director
St George Mining Ltd Legend Mining Ltd Metals X Ltd

Jamie Sullivan Peter Muccilli Brighton Gwavava
Managing Director Managing Director Managing Director
GME Resources Ltd Mincor Resources NL Suntech Geometallurgical
Laboratories
Conference Sponsors:

australiannickelconference.com

To present, exhibit or attend as a delegate please contact
Christine Oelschlaeger (+61) 8 9321 0355 [email protected]

THE AMERICAS

Metminco lands
back in Colombia

by Mark Andrews

When looking for mining opportunities in South America Miraflores gold project in Colombia.
several years ago, Metminco Ltd had Colombia at the
top of its list. The cash injection from the Los Calatos sale and the
potential monetising of the Chilean assets means Miraflores
However, political instability in the country at the time is funded through to a decision to mine.
meant the wise decision for Metminco was to seek ground
elsewhere. Production in early 2019 is being targeted and if achieved
would provide a certain degree of satisfaction for Metminco’s
Instead, its search for projects took Metminco to Chile and board.
Peru, where exploration for base and precious metals proved
fruitful, particularly at Los Calatos in the Atacama Desert. “Before we found this project in Colombia, the board looked
for two years for a near-cash producing project we could
On the back of a hot copper market and booming Chinese focus on. We probably looked at 40 projects, but none of
demand, Metminco once boasted a market cap of $700 them really made the grade except for this one in Colombia.
million with Los Calatos primed as a Tier One copper-moly Once we decided this was a project that met our criteria,
play. which was essentially cash generation within two years,
within our capital and capability base, we decided to focus
“We were looking at potentially 2bt [resources] there,” on it,” Wing said.
Metminco chairman Phil Wing told GMJ recently.
Twelve months ago, Metminco acquired the Quinchia gold
“Copper was around $US4-4.50/lb and there was a lot of portfolio in Colombia’s Mid Cauca porphyry belt which also
institutional interest in South American copper, particularly hosts AngloGold Ashanti Ltd’s 29 moz La Colosa project and
in Chile and Peru. But, as the market turned – China came Goldcorp Inc’s 14 moz Marmato mine.
off and copper came under pressure – the big exploration
development projects were put on the backburner or just Within the 2.8 moz Quinchia gold project, Miraflores will be
didn’t get funded.” the backbone of Metminco’s new era in the precious metals
space.
Being a medium-cap company, cash-constrained and with
suitable partners hard to come by, Metminco had trouble There is an existing measured and indicated resource at
funding a BFS at Los Calatos. Miraflores of 9.27mt @ 2.82 g/t gold and 2.77 g/t silver for
840,000oz gold (JORC 2012).
“Eventually we did a deal to have the project funded through
to feasibility, with an option to sell down,” Wing said. From that base, Metminco hopes to prove the viability of a
50,000 ozpa gold project over nine years.
In June, Metminco announced it had sold the remaining 49%
interest in Los Calatos to CD Capital Natural Resources A feasibility study on underground operations is expected to
Fund III LP for $6.7 million cash. be completed in Q3, while Metminco plans to submit an EIA
for approval by the end of the year.
The sale effectively cuts ties in Peru, leaving Metminco with
three projects on care-and-maintenance in Chile and its new Assuming Metminco ticks all the necessary boxes, mine

Page 52

construction is planned to start sometime porphyries will be predominantly gold plays. The market
in 2018. doesn’t quite understand that Miraflores is the most
advanced, but the other properties we have are quite
“The most challenging thing for us at prospective. One of the things we are able to do with extra
the moment is getting the environmental capital now is fill out exploration and start mentioning the
impact and community conditions agreed; potential of the other properties,” Wing said.
there is a lot of work going into that,” Wing By demonstrating the potential high growth, high return value
said. proposition through economic gold grades, Metminco will no
doubt start to garner some attention in the market and see
“There had been quite a lot of good an appreciation in market cap from the current $6.2 million.
ground work done on the community and However, in addition to the economic viability of Miraflores
environmental impact studies. We have and the other gold projects, Metminco will also need to
obviously brought a bit more rigour and convince investors Colombia is not the place it once was.
expertise to the table. That is definitely A peace deal brokered between the independent Marxist
our challenge, but so far everything is FARC movement and the Government in 2016 has improved
progressing as we would have hoped for.” the investment climate in Colombia, with recent reports
stating the former had handed in all but a few individual
A scoping study in September 2016 weapons to the UN.
estimated pre-production capital costs for
an underground mining scenario, including A feasibility on underground
contingencies, of $US81.2 million. operations at Miraflores will be

Wing said there were a lot of ways Metminco could completed in Q3
improve capex and AISC of $US647/oz.
“Colombia is second in South America behind Mexico in
“We didn’t really feel the mining plan was right, we felt doing business. It is just out of the top 10 in jurisdictions to
the capital was too much and we thought we could invest, I think it is the 11th best mining jurisdiction,” Wing
bring down opex,” he said. said.
“There is something like 40 major mining projects going
“Besides having a good resource base, we thought on in Colombia right now and the Government is focused
there was a lot of potential to change the fundamental on developing infrastructure. There is access to labour at
economics in a positive way. That is proving to be the competitive prices plus water access and rights are much
case as we move through to feasibility.” better than other parts of South America.
“There are a lot of good things about Colombia and I think
A robust feasibility study could be the trigger for it is under-explored and under-recognised, but is certainly
Australian investors to take notice of Metminco once going to start getting on people’s radar. I suspect the market
again. perception about Metminco is partly because they don’t
know Colombia. Right now, Colombia is in the top 20 of gold
Despite Lanstead Capital LP’s 19.9% interest and producers in the world, it is still only 20% of what Australia
new investor Redfield (8.9%), the uptake from the does but it is definitely on the rise.”
Australian market in the Metminco story has been
slow.

It is perhaps a lack of awareness about the investment
climate in Colombia which leads investors to remain cautious.
In an effort to bolster its brand, Metminco is launching a new
marketing campaign.

Wing said re-educating the market about Colombia and
also outlining the prospective nature of the host mineral belt
would see an increase in value attribution.

“We have got no attributable value to an asset that has got
triple digit NPV, so we are expecting that once we get the
message out there, shareholders should start getting the
value out of the asset,” he said.

The potential value is not only restricted to Miraflores, with
regional targets like Tesorito and Chuscal potential sources
of high-grade ore once operations are established.

Metminco’s longer term strategy in the belt is targeting about
10 moz in open pit gold resources.

“The other properties are quite prospective; the large

Page 53

DRILL BITS strikedrilling.com.au

OreCorp recently GOLD ROAD STARTS ENGINE AGAIN
completed infill drilling at
Gold Road Resources Ltd has started a $30 million
Nyanzaga, Tanzania greenfields exploration campaign in the right fashion across
the vast Yamarna greenstone belt.
Best bedrock intersections from RC drilling at Ibanez
included 10m @ 28.67 g/t gold from 240m, including 2m
@ 136.57 g/t from 240m and diamond drilling at Renegade

ORECORP INFILLS NYANZAGA Gold Road has started a $30 million drilling programme in the
Yamarna greenstone belt with good early success
Infill drilling results from the Nyanzaga project, Tanzania, has
OreCorp Ltd confident the current 3.3 moz @ 3.48 g/t open
pit gold resource can be upgraded.

A DFS is in progress on Nyanzaga, with a resource likely to
be completed in Q3.

Initial infill results were reported in May, with OreCorp
following up in June with intercepts of 51m @ 4.61 g/t gold
from 1m (including 7m @ 14.76 g/t from 37m); 34m @ 3.04
g/t from 95m; 33m @ 3.16 g/t from 70; 23m @ 8.23 g/t from
287m (including 2m @ 73.7 g/t from 290m) and 70m @ 4.51
g/t from 322m (including 1m @ 125 g/t from 329m).

A total of 74 diamond and RC infill holes for 13,742m was
completed, with overall spacing within the area now about
20m by 20m.

the future force in drilling

mineral exploration

Page 54

strikedrilling.com.au

returned 2.3m @ 4.24 g/t from 67.7m, including 0.4m @ in the area, into a significant new asset, according to the
17.28 g/t from 68.21m. company.
Ibanez and Renegade are part of Gold Road’s 100%-owned Thick, shallow, high-grade intersections from drilling west of
North Yamarna package, while at its 50%-owned Gruyere JV Flinders included; 4m @ 7.76 g/t gold from 13m; 8m @ 6.6
diamond drilling results included 49.7m @ 1.06 g/t gold from g/t from 11m; 3m @ 6.83 g/t from 5m and 26m @ 1.39 g/t
87.5m including 13m @ 2.12 g/t from 116.7m. from 17m.
RC drilling at the 50%-owned South Yamarna project
included 10m @ 1.06 g/t from 92m, including 6m @ 1.53 g/t ANTIPA HITS HIGH NOTE AT NORTH TELFER
from 92m at Yaffler South.
Antipa Minerals Ltd’s high-grade gold intercept from
BEACONS OF LIGHT AT JARUDI the near-surface WACA deposit, Minyari Dome, in June
garnered some attention in the market.
Successful extension of the Eastern Arm mineralisation and Minyari Dome is part of the company’s North Telfer project,
demonstrated strong geological continuity from infill drilling 40km from Newcrest Mining Ltd’s Telfer gold-copper-silver
will be followed an airborne heli-VTEM survey and six-hole mine.
RC programme at Black Cat and Black Cat South by Beacon The results from WACA included 42m @ 7.8 g/t gold from
Minerals Ltd at the Jarudi project. 262m down hole, including 13m @ 22.1 g/t (also including
Results included 10m @ 5.4 g/t gold from 13m and 9m @ 1m @ 222 g/t); 28m @ 3.6 g/t from 13m down hole, including
3.4 g/t from 11m while infill RC intercepts of 7m @ 5.1 g/t 12m @ 7.2 g/t.
from 13m and 9m @ 3.1 g/t from 10m were drilling highlights
from Jarudi, north-west of Coolgardie. North Telfer is shaping up
nicely for Antipa Minerals
HORIZON ON POINT AT HERON SOUTH

Horizon Gold Ltd has received results from the first round of
drilling undertaken at the Gum Creek gold project this year.
At Heron South, drilling intersected the mineralised structure
close to the expected target depths, with best results being:
3m @ 6 g/t gold from 88m; 4m @ 5 g/t from 99m and 4m @
4.27 g/t from 127m.

MINCOR’S NEW FIND KEEPS DELIVERING

Mincor Resources NL’s Widgiemooltha gold project
continues to demonstrate significant growth potential, with
new intersections achieved immediately west of the Flinders
orebody.
A new discovery, named Flinders West, has transformed an
underrated and lightly-drilled prospect, one of many such

deep reverse circulation
high capacity aircore

10 Bradford Street Kewdale Western Australia 6105

strikedrilling.com.au 08 935 335 52 subscribe

Page 55

GOLDEN HANDSHAKE

RAMELIUS ATTRACTS MACA is the preferred contractor for open
MACA TO MT MAGNET pit mining services at Mt Magnet

MACA Ltd has been confirmed as WESTGOLD GOBBLES UP MINING
the preferred contractor for open- CONTRACTOR
pit mining services at Ramelius
Resources Ltd’s Mt Magnet gold Peter Cook’s Westgold Resources Ltd has moved to acquire
project and surrounding satellite one of Australia’s largest privately owned underground
pits. mining and drilling contractors.

Works are expected to begin this Westgold signed an agreement last month to acquire
month, with the final contract Australian Contract Mining Pty Ltd (ACM), which currently
award subject to final statutory has mining contracts at three of the gold producer’s
approvals and finalisation of terms. underground mines.

MACA will provide a range of The move to acquire ACM comes after Westgold successfully
services, including drilling and commissioned its fourth operation at Fortnum, with the
blasting, loading and hauling, company turning its focus to lowering its cost of mining by
and the Perth-based contractor is reducing contractor margins and increasing flexibility in
expected to remain on site for 32 months. mining plans through becoming an owner-operator.

The contract is tipped to generate about $100 million in “This is a fantastic move and opportunity by the company to
revenue for MACA. consolidate and focus the outputs from our operations to the
common goal of increased gold production at lower cost per
MACA has recently won mining and bulk earthworks ounce,” Cook said.
contracts at Gold Road Resources Ltd’s Gruyere gold
project and Northern Minerals Ltd’s Browns Range rare Westgold will acquire all of the shares in ACM for a net
earths project, with both awards expected to bring in about consideration of $25 million cash plus 14 million fully paid
$60 million for the company. ordinary shares.

SUNRISE DAM PLANT UPGRADE UNDER WAY

GR Engineering Services Ltd is designing and constructing a
brownfields upgrade to the processing facilities at AngloGold
Ashanti Ltd’s Sunrise Dam gold mine.

Under the terms of the EPC-based contract, GR Engineering
will produce a new flotation and ultra-fine grind processing
facility with associated services upgrades.

GR Engineering will make use of existing infrastructure
currently in operation at the mine, about 55km south of
Laverton.

The contract is valued at $31.3 million, with work already
under way and scheduled for completion by June 2018.

OVER 2000

PROjEcts & studiEs cOmPlEtEd

succEssfully aROund thE wORld

Page 56

ACM founder Brian Rodan will join Westgold’s executive Other work to be undertaken by DRA includes construction
management team and continue as chief executive of the of pump and piping systems to transfer the hydraulically
wholly-owned subsidiary. mined tailings slurry to the CIL plant and the new tailings
storage facility.
WEST WITS MAKING WAVES AT SOL PLAATJE The new CIL process plant has a commissioning target date
of Q4 2018, with the final phase of the tailings storage facility
ALS Mining Proprietary Ltd has won the tender to conduct to be completed in Q1 2019.
load and haul services at West Wits Mining Ltd’s Sol Plaatje DRA has been involved with Pan African since the DFS
project, within the broader Soweto Cluster gold project, near phase of the project.
Johannesburg in South Africa.
AUSENCO STUDYING UP ON NUEVA
The mining contractor fleet was being mobilised at the time ESPERANZA
of print, with operations expected to begin in late June.
Ausenco has been tasked with completing the detailed
According to the tender, the scope of work was based on engineering and technical components for the feasibility
calls for monthly production of 15,000t of reef ore. study on Kingsgate Consolidated Ltd’s Nueva Esperanza
project in Chile.
ALS was chosen after an extensive tender process. West Work is scheduled for completion in January 2018.
Wits made the decision in conjunction with its partner and Kingsgate said the feasibility study, along with concurrent
head contractor Elandiwave Pty Ltd. permitting, is a key step in de-risking and adding value to
the project.
West Wits and Elandiwave are assessing proposals for “We are delighted to be in partnership with Ausenco to
contract ore processing. complete the Nueva Esperanza feasibility study, having
successfully worked with them in the past,” Kingsgate
DRA TO TOP AND TAIL ELIKHULU executive chairman Ross Smyth-Kirk said.
RETREATMENT
Ausenco will oversee the detailed engineering and technical
DRA Global will deliver a detailed design and construction aspects of the Nueva Esperanza feasibility study
supervision service for the Elikhulu gold tailings retreatment
plant facility at Pan African Resources plc’s Evander
operations in Mpumalanga, South Africa.

It will be DRA’s first gold tailings
retreatment plant and involves all aspects
of construction, including hydraulic mining,
processing and tailings deposition.

The scope of services through all stages
of the R1.6 billion (circa $US120 million)
tailings retreatment project includes the
reclamation of three existing storage
facilities – Kinross, Leslie, Winkelhaak –
as well as water supply, hydraulic mining
infrastructure and a new CIL gold recovery
plant.

ExtRaORdinaRy POssibilitiEs in mininG and minERals PROcEssinG find Out mORE

DiAmonDs GoLD RARe eARth PLAtinum CoAL BAse metALs DRAglobal.com

Page 57

HIDDEN TREASURES

Gold: A health cure?

Gold might be better known for its use in luxury items and The scientists found that the nanoparticles which worked
trade, but scientists are now trialling its applications in best for their study were around 60 nanometres.
cancer treatment.
These antibody-coated gold nanoparticles inserted
The precious metal is being tested in nanoparticle therapy, themselves into cancer cells far more easily than healthy
which is when clusters of gold nanoparticles are introduced cells.
to the bloodstream in order to coat a cancer cell, before
being heated by an infrared laser. Once the particles are inside the cells, the researchers
exposed the tissue to an infrared laser pulse for 30
Energy imparted by the laser causes the fluid around the picoseconds (30 trillionths of a second).
cluster to reach temperatures high enough to vaporise,
resulting in the destruction of the cancer cell, leaving healthy This particular type of laser light is ideal, because it
cells unaffected. penetrates tissue well and when light hits the nanoparticle
it does not absorb it and immediately starts heating up the
The hard part is making sure the gold particles are attracted gold nanoparticle cluster, which overheats and kills the
more to cancer cells and not healthy cells. cancer cell.

To accomplish this, the particles are coated in an antibody The method is not the best for killing a big tumour, but it does
known to attach to the specific types of aggressive cancer. not mean it is not useful.
In the case of this study it was the head and neck squamous
cell carcinoma. Even after removing a bigger tumour, residual cancer cells
can be left behind in the area.
The researchers, mostly from University of Texas and Rice
University in Texas, also found there was an ideal size to the These residual cells can grow into tumours, leaving the
gold particles. possibility of the cancer returning.

If the particles were less than 10 nanometres (10 billionths Detecting single residual cancer cells is not easy, however, a
of a metre) in diameter, the cancer cell would quickly clear cluster as small as three cancer cells can be detected using
them out. the gold nanoparticle method.

If the particles were greater than 100 nanometres the cancer Removing residual cancer cells with nanoparticles was
cell had trouble absorbing the particles. deemed a new type of surgery – Plasmonic NanoBubble
nanosurgery or PNB nanosurgery – by the researchers.

INDEX

Acacia 50 Classic 34 Intermin 11 Prospech 6
Condamine 5, 6
Agnico Eagle 33

Alto 11, 37 Kidman 34 Ramelius 36, 56
Kingsgate 57
Amani 48 Dacian 4, 6, 16 Randgold 48
Doray 33
Anglo American 33 Draig 41 Regis 23-24

AngloGold 44, 48, 50, 52, 56 Latitude 40 Resolute 24

Antipa 55 Riversgold 6, 33

Asanko 44-46 Eastern Goldfields 27 Metminco 52-53 Rupert 33
Emerald 33 Middle Island 38-39
Aurion 33 European Metals Millennium
6 Mincor 30
Ausgold 35 Mod 55 S2 Resources 32-33
Musgrave Sandfire 18
Azumah 46-47 5 Semafo 47
36 Silver Lake
First Quantum 33 St Barbara 11, 36
31
B2 Gold 33

Barrick 50 Gascoyne 6, 16

Beacon 55 Glencore 8 Newcrest 31
Northern Minerals 56
BHP 47 Gold Fields 27 Northern Star 27 Teranga 41
Troy 37
Boliden 33 Gold Road 27, 54-55, 56

Breaker 4, 6, 16-21 Goldcorp 52

Gulf Industrials 47 OceanaGold 5 West African 49
OreCorp 54 Western Areas 34
Calidus 6 Westgold 36, 56-57
Cardinal 47 Horizon 55
Catalyst 31
Chalice 35 Independence 32 Pan African 57
Peel 31

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