Bryah Basin Project (WA)
Base Metals Exploration (Alchemy 20%)
Leading Australian base metal producer Sandfire Resources NL is actively exploring the base metal prospective areas of the Sandfire Bryah Basin Joint Venture area (red outlines in Figure 1). Sandfire spent approximately $8.9M (including ~$2.9M spent by previous JV partner IGO) to earn a 70-80% interest. Alchemy is now free-carried on further exploration to completion of a Pre-Feasibility Study, and then carried on an interest-free deferred basis for a further $5M of Definitive Feasibility Study expenditure with the deferred amount to be repaid in full from 50% of Alchemy’s share of profits earned through production.
The Sandfire JV area contains more than 60km of strike extent of the Narracoota – Karalundi volcano-sedimentary sequence, host to Sandfire Resources’ DeGrussa copper-gold deposit and the high-grade Monty copper-gold resource (Fig. 1), and prospective for discovery of VMS-style copper-gold deposits. Sandfire has extensive local VMS exploration and discovery experience and is applying its state-of-the-art geophysical tools and renowned in-house geological team to comprehensively evaluate the prospective Narracoota– Karalundi stratigraphy on the JV tenements.
Subsequent to earning their JV interest, Sandfire completed an extensive aircore and follow-up RC program comprised of over 1,700 holes and more than 130,000 of drilling (Figure 2). Significant intercepts to date include:
- 5m @ 6.4g/t Au*
- 5m @ 2.7g/t Au*
- 5m @ 2.0g/t Au*
- 5m @ 1.6g/t Au*
*not yet followed up
Additional aircore drilling within the copper-gold prospective Narracoota Volcanics and Ravelstone Formation sediments (DeGrussa host rocks) to the east of Horseshoe Lights mine is due to commence Q3 2020 at an 800m x 800m drill line spacing. A moving loop electromagnetic (MLEM) survey designed to further improve targeting of the host volcanogenic massive sulphide (VMS) horizon is now complete. Processing of the MLEM data is ongoing and, along with the gravity data, will be incorporated into existing regional datasets and inversion models created. The resulting models will then be used to target VMS mineralisation and further refine Phase 2 drilling.
AC drilling has also been planned for the Horseshoe Lights area. This drilling will target copper-gold mineralisation within the Narracoota volcanics and the Ravelstone Formation sediments.
Gold Exploration (Superior Gold earning up to 80%)
Exploration of Alchemy’s whole and part tenements that cover the gold prospective part of the Bryah Basin Project (Fig. 1) continues under a Joint Venture arrangement with Billabong Gold Pty Ltd a wholly owned subsidiary of Superior Gold Inc. (TSX-V: SGI) (“Superior Gold JV”). Superior has recently earned a 70% interest in Jackson Minerals tenements and an 80% interest in Alchemy tenements.
Alchemy’s interest is carried on an interest-free deferred basis to production, with Alchemy to repay the deferred amount at the rate of 50% of its share of free cash flow from production following commencement of mining.
The Superior Gold JV currently has a JORC Code 2012 compliant inferred resource of 114,000 oz @ 1.6g/t Au) at the Wilgeena Prospect (re-named Hermes South). The mineralisation is open at depth and further drilling has excellent potential to expand the area of gold mineralisation and add to the known resource. Superior plan to commence mining Hermes South during the first half of 2021.
Alchemy also retains a 1% NSR on 20,000oz beyond 70,000oz of gold production from Hermes where production is currently at ~50,800 oz.
Gold mineralisation at the Central Bore gold prospect is associated with a series of northeast-trending veins and structures in granite. Assay results from drilling, including screen fire assays for selected high grade samples, include best intersections of:
9 metres at 5.86 g/t gold from 35 metres (CBRC004)
9 metres at 3.79 g/t gold from 49 metres (CBRC004)
20 metres at 1.99 g/t gold from 32 metres (CBRC005)
2 metres at 10.64 g/t gold from 80 metres (CBRC005)
4 metres at 5.35 g/t gold from 86 metres (CBRC005)
8 metres at 2.48 g/t gold from 61 metres (CBRC011)
3 metres at 3.80 g/t gold from 80 metres (CBRC011)
15 metres at 1.90 g/t gold from 96 metres (CBRC011)
16 metres at 2.48 g/t gold from 86 metres (CBRC018)
4 metres at 25.79 g/t gold from 125 metres (CBDD002)
14 metres at 3.24 g/t gold from 44 metres (CBRC035)
13 metres at 1.41 g/t gold from 80 metres (CBRC035)
3 metres at 9.12 g/t gold from 123 metres (CBRC038)
9 metres at 4.80 g/t gold from 140 metres (CBRC045)
The recent and previous drilling at Central Bore indicates that the high-grade gold mineralisation may form parallel shoots that plunge to the south-east.
Based on drilling results to date, gold mineralisation at the Seaborg and Central Bore gold prospects remain open at depth and along strike. Further targeted RC and diamond drilling has the potential to expand the areas of gold mineralisation outside of the known mineralised areas.
Competent Persons Statement
The information in this report that relates to Exploration Results is based on information compiled by Mr Leigh Ryan, who is the Managing Director of Alchemy Resources Limited and holds shares and options in the Company. Mr Ryan is a Member of the Australian Institute of Geoscientists and has sufficient experience of relevance to the styles of mineralisation and the types of deposits under consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (‘JORC Code 2012’). Mr Ryan consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.
The information in this report that relates to Mineral Resources at the Hermes South Gold Deposit is based on information compiled by Mr Stephen Hyland, a geological consultant working for Superior Gold Inc. Mr Hyland is a Fellow of The Australasian Institute of Mining and Metallurgy, and has sufficient experience of relevance to the styles of mineralisation and the types of deposits under consideration, and to the activities undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (‘JORC Code 2012’). Mr Hyland consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.”