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Meteoric Resources set to boost gold portfolio with past-producing WA project

Last updated: 11:57 15 Jun 2020 AEST, First published: 20:57 15 Jun 2020 AEST

Meteoric Resources NL - Meteoric Resources set to boost gold portfolio with past-producing WA project
Butchers Creek Open Pit has a maximum depth of 70 metres with average depth of 30 metres

Meteoric Resources NL (ASX:MEI) (FRA:RNF) intends to add to its stable of highly prospective gold projects after signing a conditional legally binding term sheet to acquire the past-producing Palm Springs project in WA’s Kimberley region.

Palm Springs is an advanced exploration play with past production, high-grade drill intercepts and historical resources within the Halls Creek Orogen around 30 kilometres southeast of Halls Creek.

WATCH: Meteoric Resources' Andrew Tunks looks ahead to drill program at new Palm Springs gold project

Production in the late 1990s came from the Butchers Creek Open Pit gold mine with 52,000 ounces at 2.1 g/t gold produced until mining was stopped by the historically low gold price.

Advanced exploration opportunity

Managing director Dr Andrew Tunks said the Palm Springs Project was a fantastic addition to MEI’s gold portfolio.

“We have been looking for an Australian gold project since early in 2020 to complement our exciting Brazilian assets and take further advantage of historically high gold prices.

“The Palm Springs Gold Project is an advanced exploration opportunity based around a historic open pit mine that shut down at a time of exceptionally low gold prices.

“The Butchers Creek Open Pit was mined by Precious Metals Australia between 1995 and 1997 and produced over 50,000 ounces of gold at a recovered grade of 2 g/t.

“The Butchers Creek pit is quite shallow, 25 metres in the south to 70 metres in the north, and there is substantial drilling beneath the pit that indicates the ore body is open at depth and down plunge to the south.”

Shares higher

Shares have been as much as 53% higher this morning to 2.9 cents.

Location of Palm Springs Gold Project showing major ore bodies across the Halls Creek Mobile zone.

Historic drilling beneath the pit returned thick mineralised envelopes and narrower, very high-grade zones and results including:

  • 68 metres at 2.5 g/t from 44 metres;
  • 19 metres at 8.8 g/t from 56 metres;
  • 14 metres at 7.5 g/t from 82 metres;
  • 50 metres at 3.31 g/t from 50 metres; and
  • 7 metres at 4.2 g/t and 8 metres at 17.4 g/t from 49 metres.

Northern Star Resources Ltd completed drilling and a mineral resource on the project at the Golden Crown and Faugh-a-Ballagh prospects and best results include 2 metres at 174.7 g/t from 12 metres and 5 metres at 4.9 g/t including 0.4 metres at 47.2 g/t from 126.6 metres.

No modern exploration

Tunks said: “During our due diligence process, it became obvious that the Butchers Creek area has had no modern exploration since the mine closed in 1997.

“Since that time, all the historic digital data has been lost and as such, the geological evaluation had to be carried out via 'the old school' method of manually working through 65 paper drill cross-sections, a slow and painstaking process of reading the section drilling data off metre by metre to compile the significant intercepts.

“As we worked through the sections in detail, it highlighted to me the incredibly significant opportunity that Palm Springs offers Meteoric.”

The acquisition includes three MLs, with 95% interest in two of these, four ELs and seven PLs including 20 kilometres of prospective strike and covering more than 12,500 hectares with more than 60 known gold occurrences outside the Butchers Creek Mine.

The Palm Springs gold treatment plant circa 1996. Although the plant was removed the concrete footings, terraced working and lay down areas remain.

Drilling targets

There are immediate drilling targets beneath the previously producing mine as well as encompassing substantial brownfields exploration targets along the prospective strike.

In relation to the potential below the pit, Tunks said: "As a gold explorer I am greatly excited by the continuity of the grades and the thick robust nature of the mineralised zones.

"Geological reports from this time indicated that the mineralisation is associated with strong potassium and pyritic alteration, yet no geophysical surveys have been used for exploration.

"Our initial drilling programs will look to target this and other similar zones below and to the south of the open pit, providing us a fantastic place to commence our exploration."

On the ground within a week

Geologists from Meteoric will be on the ground within the next week collecting data and engaging with local groups in preparation for a drill program that will begin as soon as practicable.

The MD said: “Across the project there are another 60 known gold occurrences that have seen some exploration and historical production, yet many of them remain undrilled.

"At Golden Crown and Faugh-A-Ballagh prospects, (approx. 4km northeast of Butchers Creek) Northern Star Resources Ltd (ASX:NST) outlined a small resource that remains open at depth and along strike.

"Interestingly this was Northern Star’s maiden resource and a springboard to bigger things."

He said the acquisition was a great result for Meteoric and “I look forward to progressing our 2020 exploration programs concurrently at both our Australian and Brazilian assets”.

“The project is ideally situated, only 30 kilometres southeast of Halls Creek with excellent road access, has known metallurgical recoveries over 90% from a standard CIL circuit and granted Mining Leases covering the main zones of mineralisation at Butchers Creek.”

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