The arrival of the Bolnisi gold project into the company’s portfolio certainly marked a radical departure away from the previous focus, which had centred on old Austrian gold mines.
As a result, the company was able to demonstrate a controlling interest in a project with a major resource base and real potential upside, because whereas the Austrian projects are prospective but speculative, Bolnisi is demonstrably big.
It comprises 861 square kilometres of ground in the south west of Georgia, and is by no means virgin territory.
On the contrary, previous work has identified 980,000 tonnes of contained copper on the project, as well as 6.6mln ounces of gold and 22mln ounces of silver, as well as associated silver, lead, zinc and barite.
That’s a resource inventory that would make many a junior miner weep with envy, although given the ongoing bear market in the mining sector it’s probably too much to bite off in one go.
Rather, Noricum plans a piecemeal approach and recently raised £1mln with a view to advancing what it calls “early stage production opportunities” that could come on stream as early as the third quarter of 2016.
The thinking is clear.
While Noricum has historically been well supported in the market, it’s long been a preference in London’s mining finance community that large scale exploration be supported by smaller scale cash flow.
That way a junior miner isn’t constantly distracted by a need to come back to the market for financing. To put it even more crudely, it’s less vulnerable to being held to ransom by bottom-feeding equity sharks bent on making a quick turn on heavily dilutive and discounted fund-raisings.
With its move into Georgia, Noricum has effectively neutralised that threat.
It’s identified two potential starter pits at Tsitel Sopeli and Kvemo Bolnisi, which should be able to provide cash flow in the near term. Both these areas benefit from a combination of outcropping gold mineralisation and proximity to two nearby operating mines owned by Noricum’s local partner.
The latest drill results continue to confirm the potential of these two operations, with Noricum chief Greg Kuenzel talking of “leveraging off existing infrastructure” and of “the near term transformation of Noricum Gold into a low cost producer generating material cash flows.”
These, he says, “can be reinvested into the multiple development opportunities we have already identified at Bolnisi.”
Meanwhile, work on the Austrian assets continues. Back in March 2015, the company showed its faith in the prospectivity of its Austrian ground by adding a new project, Walchen, to the portfolio.
This project has historically delivered strong copper, zinc, lead, silver and gold grades, and initial reconnaissance work by Noricum has confirmed the potential of this ground.
Nevertheless, the main Austrian asset remains the 37 square kilometre Schonberg licence in the southern part of the country.
Here, Noricum has confirmed the presence of eight mineralised veins across a three kilometre strike in a district replete with former mining operations.
Current thinking is that the mineralisation that’s already been established continues to the east into another known mining district called Tremmelberg.
But the most recent drilling, while returning promising results in terms of grade, also highlighted that Noricum hasn’t yet got a full understanding of the mineralogy of the ore. This has led the company to call a temporary moratorium on drilling while it reviews the data it’s already gathered and tries to build a working model.