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Artemis Resources Limited (ASX:ARV) Artemis to Acquire Weerianna Gold Deposit

Artemis to acquire Weerianna Gold Deposit

- Option to acquire 80% interest in Weerianna Gold Project in Pilbara

- 70,200 oz gold JORC Resource

- Potential to host 250,000 + oz. gold

- Acquisition of Weerianna to boost Artemis’ gold inventory

Artemis Resources Ltd (ASX: ARV) is pleased to announce it has secured an option to acquire the Weerianna Gold Project located in the Pilbara, Western Australia (the “Project”).

The project was previously owned by Homestake Australia having been acquired in 1998 from Canadian  mining group Noranda.

The project currently hosts a JORC compliant inferred resource of 1,005,159 tonnes at 2.17 g/t Au for a total of 70,201 ounces of gold using a 1.0 g/t Au cut-off.

Excellent potential exists for a substantial increase in tonnage as the current resource is open at depth and  along strike.

The proposed acquisition is part of Artemis’ strategy of focusing on gold and building its gold inventory.

Artemis’ Chief Operating Officer, Guy Robertson, said:  “The acquisition of a third gold project will immediately bolster Artemis’ known gold resources inventory. With our technical team, we can move quickly to develop and increase the value of these projects through infill and resource definition drilling.”

The Weerianna gold project has a number of advantages including:

- Allowing fast track development as Weerianna lies within a granted Mining Lease.
- Located close to regional centres Karratha and Roebourne
- Located just off the North West Coastal Highway
- Previous gold production in the 1930’s
- Significant exploration upside

Gold was first discovered at Weerianna in 1896. Recorded production from seven workings at Weerianna up until 1938 was approximately 3,000 ounces at a grade of close to 35g/t Au (over 1 ounce per tonne). A gold battery was in operation in 1938 but production records after that year are not available.

Two global mining companies have previously owned Weerianna. In 1978, Canadian mining company Noranda pegged twelve gold mining leases around Weerianna. Between 1986 and 1988 a drilling programme comprising 132 Reverse Circulation holes and 5 diamond drill holes was carried out. In addition, 30 costeans were excavated and extensive shallow RAB drilling was undertaken. In 1997 a further 15 drill holes were drilled.

Homestake acquired the prospect in 1998 after a takeover. Due to low gold prices and the project not meeting the criteria of a major global gold company, Homestake resolved not to conduct further exploration at the time.

A geostatistical resource estimate of the Weerianna deposit was undertaken in August 2009 by Geostat Services Pty Ltd. The study concluded that infill drilling was needed to test for extensions of the four main mineralisation zones or lodes. The deposit was found to be open at depth because ofthe restricted depth of drilling completed. There are also areas between these lodes and along strike where there is insufficient drilling.  

Artemis is of the view that the deposit has excellent potential to host 250,000 plus ounces of gold.

Artemis is currently undertaking due diligence on the project.

The key terms of the transaction are as follows:

- Artemis has paid an option fee of $50,000, entitling it to a 45 days exclusivity period in order to carry out confirmatory due diligence;

- Subject to Artemis confirming that it wishes to proceed, it shall be entitled to acquire 80% of the Project from the vendor for 68,000,000 fully paid Artemis shares and $300,000 in cash. The vendor shall be entitled to a free carried interest (in respect of its 20% share) up to a decision to mine and a net smelter royalty of 1.75%.

- Completion of the transaction is subject to such regulatory approvals as are required to be obtained by Artemis, including in respect of the issue of shares in excess of its 15% capacity.

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