Argonaut Resources NL (ASX:ARE) is fast-tracking plans to drill about 20 reverse circulation (RC) holes at Island gold prospect south of the Higginsville Mining Camp in Western Australia's Goldfields.
The program is budgeted to cost around $300,000 and Argonaut will allocate these funds from a share placement which raised $1.28 million.
This placement of 399.3 million shares was well supported by professional and sophisticated investors, surpassing the company’s target to raise $1 million.
As well as fast-tracking drilling at the Island prospect, funds will be used to execute ground gravity surveys at the Murdie Copper Project.
Shares are up 25% to 0.5 cents.
The RC drilling at Island is set to begin next month after securing a track-mounted, slim-hole RC drilling rig.
The Island prospect has been defined by a 1,200 metre by 400-metre gold geochemical anomaly and surface rock-chip samples.
It benefits from not having been previously drilled and sits outside of neighbouring tenements which were last drilled in the 1990s.
Argonaut holds a 51% interest in a package of tenements around Higginsville and can earn up to 80% under an earn-in joint venture.
Subject to final authorisations, the drilling will be conducted on an inlet in Lake Cowan and on an island within this inlet.
Argonaut and Loded Dog Prospecting Pty Ltd executed the Eastern Goldfields Earn-In Joint Venture and Royalty Agreement covering Island on February 7, 2017.
Under the agreement, Argonaut has the right to earn an 80% interest in the tenement package according to the following terms:
- Argonaut earned a 51% interest in the tenement package by completing $500,000 in exploration expenditure within two years of commencement;
- Argonaut may earn a further 29% interest, for a total of 80%, for completing an additional $1,500,000 in exploration expenditure within a further three years;
- Reimbursement of tenement acquisition expenses totalling $250,000 was paid by Argonaut progressively under the agreement; and
- An issue of ordinary fully paid Argonaut shares valued at $50,000 was issued on execution of the definitive earn in agreement.
The earn-in agreement is in the second earn-in phase.
Argonaut has also progressed its plans to drill near-shore IOCG gravity targets at its 100% held Murdie project at the eastern margin of South Australia’s Gawler Craton.
Since being granted operational approval in late January 2020 by the South Australian Government to drill on the surface of Lake Torrens, Argonaut has lodged an application under the South Australian Aboriginal Heritage Act for the final authorisation.
The company is planning several ground gravity surveys over discrete airborne gravity anomalies.
Ground gravity data will provide the most accurate gravity data for final modelling and targeting prior to drilling.