Matsa Resources (ASX:MAT) is a step closer to a fascinating drill program at the Point Kidman site, 40 kilometres north-east of Laverton in the Eastern Goldfields that evolved after discovery of numerous gold nuggets.
Matsa farmed into the project in late 2014 and can earn an 80% interest in the project which comprises 11 exploration licences.
The nuggets were found by prospectors and spread over an irregular 2.5 km x 0.5km area in a window of leached and weathered interleaved greenstones and granite.
The target area also coincides with soil gold values and is adjacent to the prospective Laverton Shear which includes major gold deposits; Sunrise Dam, Wallaby, Granny Smith, Lancefield, Garden Well & Moolart Well.
However, no historic gold workings have been reported in the area.
Point Kidman comprises 11 granted exploration licences located approximately 40 kilometres northeast of Laverton and covers an area of 961 square kilometres.
The drilling is being carried out under a farm-in agreement signed in November 2014, whereby Matsa can earn an 80% interest in the Point Kidman gold project.
Strong financial position
Matsa is fully-funded continued exploration at Point Kidman on the heels of an important divestment worth A$8.1 million.
Last month, Matsa settled the sale of its share of the Mt Henry gold project in WA to JV partner Metals X Limited (ASX:MLX) in a deal that positioned the company as holding $12 million in liquid equities (at the time of the sale) and $2 million in cash and receivables.
With a market cap of $23 million, Matsa is estimated to have an enterprise value of around $6 million. As such, the explorer does not need to raise further funds in the current difficult capital markets to continue to develop the various arms of its expansive portfolio.
Diversified portfolio
Momentum at Point Kidman underlines the depth of Matsa’s various project holdings, which include operations across WA and Thailand in iron, precious and base metals.
Recent progress on these properties has been highlighted by the discovery of a Nova-type nickel-copper conductor last month at the company’s 96-square-kilometre Symons Hill project in WA’s prospective Fraser Range region.
Preliminary modelling indicates the new conductor to be 500 metres by 500 metres at a depth of about 150-200 metres. The discovery was made using an ongoing high power fixed loop electromagnetic survey in the southwest part of the project adjacent to a high-priority bedrock nickel anomaly.
Once the survey is completed it will likely define further conductive targets for drilling.
Symons Hill is only six kilometres form Independence Group’s (ASX:IGO) giant Nova project, which claims resources totalling 14.3 million tonnes grading 2.3% nickel and 0.9% copper for 325,000 tonnes of contained nickel and 124,000 tonnes of contained copper.
This find is likely to be the source of a recent float sample, which returned 54.7% copper and 148g/t silver.
Asian operations
Other recent advances in Matsa project development have been achieved at the company’s Siam project in Thailand, where a second copper-silver vein has been discovered returning an assay of 45% copper and 123 grams per tonne silver.
This vein is interpreted as possibly indicating a major deposit in the area or a suite of high-grade veins.
Other Matsa properties in the country include the KT gold project, 20 kilometres east of Kingsgate Resources’ (ASX:KCN) 5-million-ounce Chatree gold mine.
Analysis
Upside related to Point Kidman is associated with the discovery of gold nuggets at surface in an unexplored area which is proximal to established gold systems and large existing operations.
Matsa’s potential to take an 80% stake in the property puts it in a position to benefit immensely should the drilling substantiate the target area’s demonstrated potential.
The 961sq.km footprint of Point Kidman only 40 kilometres from Laverton offers substantial exploration flexibility as drilling further clarifies the exact geologic nature of the area.
The latest copper-silver find at Siam is significant because it may a represent a fault or fracture controlled leakage from a major copper sulphide deposit underlying the spread of native copper-rich scree and anomalous soil geochemistry at the site.
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