Buoyed by visible gold from its first diamond drill hole at the company’s Central Sandstone gold project, Aurumin Ltd has added another tenement to its land holding in WA’s East Murchison region. The move will lift the granted acreage at Aurumin’s wholly owned, historical Central Sandstone Gold Project to 126 square kilometres.
Whilst the new tenement is not large in area, the proximity and prospectivity of the ground has the company excited.
Acquired from a private company, Aurumin will hand over 500,000 shares for the E57/1140 tenement – worth an estimated $65,000 at current 13c share price – along with a one per cent net smelter return royalty.
Earlier this month Aurumin reported visible gold from a diamond drilling program from the historical mining ground where Troy Resources had produced 508,000 ounces of gold across the region, with the previous production on Aurumin’s tenements bringing 1.2Mt at 2.1 g/t gold for 78,000 ounces.
A scoping study by the project’s previous owner, Middle Island Resources, said the economics of the project would be sharpened if the 500,000-tonne per year processing plant were upgraded to 750,000tpa and additional mill feed was secured. The carbon-in-leach processing plant is currently mothballed.
Central Sandstone’s premier underground resource, Two Mile Hill, contains 14.2 million tonnes grading 1.1 grams per tonne gold and holding 500,000 ounces of gold.
Aurumin’s camp and core farm are within the town of Sandstone, 12km north of the plant that also boasts a well-maintained airport capable of servicing fly-in, fly-out operations.
Aurumin bought the Central Sandstone gold project for $12 million in cash and share from Middle Island in December last year and has hit the ground running.
It peppered the acreage with a 467-hole auger program that kicked off in April and followed up with 1400m of combined RC and diamond holes. Whilst the company reported visible gold, it is suffering the same industry-wide fate of delayed results from backed-up assay labs but expects to have some numbers back next month.
Labour shortages have also affected the drilling operations, with the company currently down to a single shift due to a lack of hands but expects to finish the current program in mid-July.
Aurumin Managing Director, Brad Valiukas said: “The tenement is a good addition and provides additional exploration opportunity, as we focus on generating critical mass for future production. The closest point of the tenement is just 4km from the existing processing plant location.”
“Diamond drilling is progressing well at the Two Mile Hill underground resource that we continue to view as a key part of the project going forward, with the scale to potentially underpin future production.”
The new tenement has seen only cursory, widely-spaced attention with the drill bit, with Aurumin considering it principally at the first pass regional exploration stage. It is now collecting and verifying data, including records from open-file reports and from the historical Troy Resources database inherited as part of the Central Sandstone project acquisition.
Interestingly, the broader region’s defined gold inventory totals almost six million ounces, with no prominent producer at present.
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By Matt Birney
