Chalice Mining
(ASX:CHN) has revealed more intriguing assays from the continuing drilling program to find the growing dimensions of its huge Gonneville nickel, copper, cobalt and PGE prospect northeast of Perth at Julimar, while at the same time expressing confidence that it is on track to outline a major development proposal by the end of the year.
The drilling seems to have confirmed the northern extension of the Gonneville prospect and will likely boost the size of the resource from its current 350 million tonnes of copper, nickel cobalt and 3PGE minerals.
Investors liked the news and sent the shares up more than 6% to $4.95, a four-month high.
The Gonneville prospect is 1.9 kilometres long at the moment, but the new drilling suggests it could be 2.5 kilometres or more, and dipping at depth and under the Julimar State Forest.
What makes the emerging extension important is that it could be a continuation of the high-grade sulphide deposits at the northern end of the Gonneville resource, which could be the basis for the starting mine for the project before the lower grade areas to the southwest are developed.
Finding more high-grade sulphide deposits – admittedly at depth – would increase the chances of the richer areas of Gonneville being the basis for the first mine in the scoping study now underway.
Chalice shareholders were told the company has enough money to fund its exploration and other work for another year and that the search for a possible partner will be a priority in 2023.
Chalice chair Derek La Ferla told the company’s annual meeting yesterday that the initial Gonneville Scoping Study is well advanced “and targeted for completion before the end of this calendar year.”
“The Study will mark a pivotal milestone for Chalice, helping to map the Gonneville Deposit’s development pathway and options, and signalling the start of the company’s transition towards project development.
He said that in parallel with the development studies, “we are also continuing a major exploration program aimed at unlocking the full potential of the Julimar Complex.” (Gonneville is the first discovery at Julimar and, from the numerous updates, seems to be growing in size and scope).
“Our exploration team hasn’t really paused in the last two and a half years since the discovery, and yet still there is significant potential to grow the current Resource base and identify further deposits over more than 30km of largely untested strike length. “
He said Chalice is “fully funded for all planned exploration and pre-development activities through to the end of 2023 following the highly successful $100 million capital raising in May.” (At $6 a share!)
“Whilst our share price has not been immune from deteriorating and volatile global market conditions, we remain focussed on value-add activities that we can control within our portfolio.
“As we begin to establish this roadmap for development, it has been pleasing to see a significantly increased level of inbound inquiry from potential strategic partners, off-take partners, financiers and investors, both in the project and at the corporate level.
“The level of strategic interest has particularly increased since the passing of the US Inflation Reduction Act (IRA), the escalation of the Russia- Ukraine conflict and the continued disruption being experienced in global supply chains.
“We announced recently that Chalice is considering securing a strategic minority joint venture partner (or indeed multiple partners) to assist in developing a potential mine at Gonneville and, while there can be no certainty of an outcome in this regard, securing a strategic partnership is one of our key objectives for 2023,” Mr La Ferla told the meeting.
The new assays have come from drilling to try and establish new areas of mineralisation linked to the Gonneville prospect
“Several outstanding broad zones of sulphide mineralisation have been intersected up to 650 metres beyond the current resource, materially extending the high-grade sulphide zones at the northern end of the Gonneville deposit,” Chalice said in yesterday’s update.
“Drilling to date has confirmed several north-westerly plunging shoots to the G2, G4 and G11 high- grade sulphide zones, which strike to the north-north-east and dip to the west-north-west.
“The broad intersections include very encouraging higher-grade sub-intervals, which highlight the significant near-term growth potential in the high-grade portion of the current Resource. As such, step-out drilling in this northern portion of the deposit-west direction is being prioritised.
“These latest results suggest that previous RC drilling in this area was too shallow and where the up-plunge extensions of the above results were intersected, the zones were heavily intruded by dolerite dykes.
“Notwithstanding this, the northern end of the Resource pit shell could deepen once the new results above have been modelled.
“Drilling immediately north of Chalice’s farmland boundary has extended Gonneville high-grade zones ~200 metres beneath the (nearby Julimar) State Forest.”
The deepest intersection in this drilling started at 899 metres.
Chalice said the results from this drilling “highlight the significant near-term growth potential in the high-grade portion of the current Resource and a potential deepening of the Resource pit shell at the northern end.
“All zones intersected remain open down-plunge and two rigs are continuing step-out drilling…Zones have a gentle north-west plunge, trending beneath the Julimar State Forest.
Chalice said early test drilling on the nearby Hartog prospect had “intersected anomalous primary sulphide mineralisation”
“One of the holes, HD042, intersected a significant interval of 21.5m @ 0.4g/t 3E, 0.1% Ni, 0.1% Cu, 0.01% Co (0.4% NiEq) from 64.9m, in Gonneville-type geology. This is a highly encouraging result, confirming the prospectivity of the Hartog Intrusion and demonstrating that it is a continuation of the Julimar Complex.”
