There’s a new gold rush on in Victoria, Australia, and Power Metal Resources Ltd (LON:POW) is right at the centre of the action, according to broker SI Capital.
Power Metal’s exposure comes through its 49.9% stake in Red Rock Australasia, a company it owns jointly with Red Rock Resources (LON:RRR).
“Red Rock Australasia have been able to acquire a number of properties of significant size, predominately focused on the non-sedimentary cover region with tenements that hold historical activities including shallow drilling, regional geophysics, and even historic mining activities,” says SI Capital.
These properties, the broker points out, are situated in a highly prospective area that already hosts several producing mines, like Costerfield and Ballarat East, and which, on account of recent new discoveries, has been the subject of heightened interest amongst exploration companies.
Red Rock Australasia will initially be testing the ‘Fosterville-style’ exploration model on its Victoria properties.
“One of the main exploration strategies deployed by companies in the region has been to focus around the Fosterville mine, however this form of ‘near-ology’ is only part of the story,” continues the SI research.
“Strong, well defined geophysical features have been identified as regional faults across the goldfield, and with coincident surface gold-oxide occurrences, many of the other major fault structures are being considered as significantly de-risked exploration targets, being that they fit nicely within the epizonal ‘Fosterville-like’ exploration model.”
The broker then cites several examples of companies whose share prices have benefitted from exploration activities in the area, including Fosterville South (CVE:FSX) and Mawson Resources (TSE:MAW).
Earlier this month Paul Johnson, the prime mover behind Power Metal Resources, highlighted the position of Red Rock Australasia in the region.
“The JV company RRAL has secured one of the largest strategic footprints in one of the most sought-after gold exploration territories,” said Johnson.
“This has been achieved partly through longstanding preparations in the background that yielded the early licence applications and then by proactive search and expedient action when new opportunities were identified.”
A full copy of the SI Capital Research is available here [https://www.powermetalresources.com/Uploads/2020-06-17-0035-POW_Victoria_Gold_Fields.pdf]