After completing the required heritage clearance survey, and securing a reverse circulation (RC) drill rig for its maiden drill programme at its Mt Maitland high-grade gold project in Western Australia, Red Mountain Mining Limited (ASX: RMX) is set to start drilling.
The drilling program is planned for 18 holes for approximately 1300 metres and is scheduled to commence in the first week of November.
Historical mining delivered an average production grade of 19 g/t gold and the company expects there could be early stage share price catalysts on the horizon should the program go well.
RMX’s project is in close proximity to the $1.1 billion Westgold Resources Fortunum Gold Mine and its Bluebird Gold Mine to the south. It is also near the $800.3M capped Sandfire’s Monty Gold Mine and its Degrussa Copper Gold Mine.
RMX acquired the Mt Maitland project, which lies within the prolific Murchison Goldfields in July this year and is encouraged by a significant gold nugget found while prospecting within the Mt Maitland tenure.
The nugget points to the potential high-grade nature of the mineralisation at the Mt Maitland Project.
The Mt Maitland Project came with multiple drill-ready targets and historic production which averaged 19g/t Au.
Outstanding results from historic exploration at Mt Maitland include:
- gold-in-soils: peak 2,724 ppb, anomalies over 13 kilometres of strike
- rock chips: up to 62g/t Au, 8.8% Cu and 290g/t Ag channel sampling: 2.50m @ 22.7 g/t Au and 0.75m @ 61.8 g/t Au
- Drill results include 13m @ 2.53 g/t from 9m, 2m @ 1.53 g/t from 13m
During the heritage survey, additional geological mapping was conducted which has assisted RMX to vector this maiden drill program.
Rare earth pick up
RMX is also in the throes of acquiring a new rare earths/nickel-cobalt project.
The company reached agreement with ARD Group (ARD), the vendors of the Mt Mansbridge heavy rare earths project, to favourably restructure the transaction that was voted down by shareholders in March 2020.
The Mt Mansbridge Project consists of three West Australian tenements containing targets prospective for HREE and nickel-cobalt.
Located in the Kimberly region of Western Australia, the project area is approximately 130 kilometres south-east of the township of Halls Creek and consists of three contiguous granted exploration licenses E80/5111, E80/5229 and E80/5413 which combined cover a total area of 280 square kilometres.
As indicated below, the tenements lie approximately 40 kilometres from Northern Minerals’ (ASX:NTU) flagship Browns Range project.
Shares in Northern Minerals have doubled in the last four months.
The project area has been subject to exploration activities since the 1970s, primarily for uranium, gold and diamonds which were all unsuccessful.
The presence of the REE mineral xenotime in the Killi Killi Prospect has been overlooked and RMX now see the opportunity to capitalise on this and determine whether there is an economically viable concentration of REEs.
As part of funding the exploration program at Mt Mansbridge, Red Mountain has received firm commitments to raise $360,000 (before costs) via a share placement to professional and sophisticated investors.
The Placement will be undertaken at 1.2 cents per share and is subject to shareholder approval.
The company is also encouraged by recent activity in the rare earths sector.
The $1.5 billion takeover bid for Lynas Corporation by Wesfarmers Limited (ASX: WES) and the recent speculation that China may restrict further material to the US has once again seen a surge in Rare Earth prices and renewed market interest and investor sentiment back to the sector.
With China currently responsible for more than 80% of global supply of rare earths, there are supply chain concerns as Beijing could use its dominant position as a rare earths exporter to the US as leverage in the trade dispute with the sector being the next front in the trade war.
This has resulted in a strong global interest in the identification and development of non-Chinese sources of rare earths to reduce the dependence on supply from China.
The future supply of heavy rare earths is critical in the development of high-tech applications and high-performance magnets used in electric vehicles and wind turbines.
The crackdown by Chinese authorities on the mining of ionic clay deposits in Southern China for environmental reasons, the lack of substitutes along with very few significant sources of heavy rare earths outside of China, has resulted in a favourable outlook for the commodities.
Other projects
Red Mountain has a number of other projects at various stages.
A preliminary groundwork exploration programme has been designed for prospective regions within the granted Koonenberry tenement EL8997, with land access agreements currently in the process of being finalised.
The Koonenberry Gold Project covers approximately 660 square kilometres, and is located in a geologic setting considered analogous to the prolific Victorian Goldfields located in south-eastern Australia.
The Koonenberry Gold Project adjoins Manhattan Corporation’s (ASX:MHC) Tibooburra Gold Project where Manhattan announced a new high-grade gold discovery in June.
Disclaimer: This article is sponsored content from Red Mountain Mining Limited (RMX) and does not constitute an endorsement by the publisher.