Arrow Minerals Limited (ASX:AMD) is a mineral exploration company, predominantly targeting gold, lithium and nickel at various sites in Australia.
Independence Group acquired a 51% interest in the Plumridge Nickel Project and an 11% strategic equity interest in Arrow for a total investment of $2.5 million.
Arrow and Independence have formed the Plumridge joint venture, covering eight exploration licences totalling 2,500 square kilometres in the Fraser Range province.
Independence has intimate knowledge of Fraser Range region
Independence is the largest tenement holder and explorer in the Fraser Range, with 14,500 square kilometres of exploration licences under management.
The company can increase its interest in the project to 90% through the expenditure of $5 million over four years.
Independence can accelerate earning its 90% interest by paying Arrow cash equal to the amount remaining for the joint venture earn-in.
This was a promising outcome for Arrow from a number of perspectives.
Firstly, it gained the support of one of Australia’s largest mining groups, a company with a market capitalisation of $3 billion and cash of $70 million to inject into exploration.
Arrow cashed up for exploration through to mid-2019
More importantly, it has provided a significant financial boost for the company with Arrow now having about $5 million to spend on exploration at its highly prospective projects.
Commenting on Independence Group’s emergence as a joint venture partner and substantial shareholder, Arrow managing director Steven Michael said: “The investment of $2.5 million by IGO for a majority interest in the Plumridge Nickel Project and strategic equity stake in Arrow is a significant turning point for the company.
“IGO is a logical partner for Arrow, given its dominant position in the Fraser Range, including 100%-ownership of the Nova Nickel Project.
“IGO’s Fraser Range exploration budget for fiscal 2018 is $21 million, including significant airborne electromagnetic, ground electromagnetic and drilling programs to be undertaken at Plumridge.”
Is Strickland a Plumridge-type sleeper
From seemingly nowhere the most experienced miner in the Fraser Range region spotted a valuable asset in Plumridge that was owned by a $10 million mining group.
The question well worth asking is whether Arrow has another ace up its sleeve.
The Strickland Gold Project could very easily be just that, and with drilling results due in mid-May there could be share price catalysts on the horizon.
A rich heritage
Arrow Minerals has a 100% interest in 1,150 square kilometres of exploration licences at the Strickland project in the Yilgarn Craton of the Eastern Goldfields.
The Strickland project covers over 100 strike kilometres of greenstone belts and straddles the Evanston and Yuinmery Shear Zones.
The Menzies and Southern Cross Regions contain over 20 million ounces of known gold endowment.
Consequently, this is a highly prospective area and Strickland is perched in the middle of what could be termed the gold triangle.
The 160-million ounce Kalgoorlie-Norseman belt lies to the southeast, the 12 million ounce Leonora belt northeast and the 15 million ounce Southern Cross belt to the southwest.
Arrow pounced as iron ore miners left
The greenstone belts have been held by iron ore companies for the majority of the past 20 years.
The last significant gold exploration was conducted in the 1990s when several targets were identified and remain untested.
In addition, most of the outcropping ground has not been covered by multi-element surface geochemistry.
Arrow completed an orientation survey at Strickland in October 2016, during which several rock chip samples were collected around historical workings at Rainy Rocks.
BIF hosted gold deposits
The Rainy Rocks prospect is on the north-eastern limb of a tightly folded anticline containing a banded iron formation (BIF) and ultramafic sequence within the Evanston Greenstone Belt.
This sequence extends along the Evanston Shear Zone towards the historical Evanston Gold Mine, about 12 kilometres southwest from Rainy Rocks.
The geological setting of the Rainy Rocks prospect and wider Evanston Greenstone Belt is characteristic of BIF-hosted brittle vein gold deposits within the Southern Cross region.
Historical production and current resources from these types of deposits in the Southern Cross district include Copperhead (7.4 million tonnes at 5.53 g/t gold), Cornishman (3.3 million tonnes at 4.56 g/t gold), Golden Pig (1.5 million tonnes at 4.87 g/t gold) and Nevoria (8.8 million tonnes at 3.2 g/t gold).
Extensive drilling campaign in progress
In March, Arrow commenced a 26,000-metre aircore drill program targeting the T1, T2, T6 and T8 prospects.
This will focus on areas where significant gold mineralisation was intersected with first-pass drilling in 2017.
The drill program will cover over 20 strike kilometres of gold in soil anomalies and define bedrock gold mineralisation.
Drilling at the T8 prospect is now complete with results expected by mid-May, providing an indication of whether Arrow is added another high profile asset to its portfolio.