Nexus Minerals' (ASX:NXM) first drilling program at the Pinnacles project in Western Australia with mid-tier joint venture partner Saracen Mineral Holdings (ASX:SAR) has delivered grades exceeding 10g/t gold in six of seven initial holes.
All seven holes in the 2,000-metre campaign intersected high-grade gold mineralisation, confirming that the width and grade of the mineralised structure extends at least 100 metres below the existing 28,000-ounce resource. The mineralisation remains open at depth and along strike.
This result represents successful achievement of the program's aims, establishing extensions at depth to about 250 metres below surface.
Standout intersections included 6 metres at 13.1g/t gold, 8 metres at 7.7g/t gold and 11 metres at 5.6g/t gold.
Andy Tudor, chief executive officer for Nexus, commented:
“We are very excited to have intersected the target zone where modelled, and that significant widths of high grade mineralisation were identified in the Nexus drill holes.
"Geological modelling will now take place integrating the Nexus drilling with that of previous operators, resulting in the next phase of drill planning."
Historically, some of the deepest reverse circulation drilling by previous operators (around 150 metres) has yielded significant high-grade gold intersections.
Additional discoveries
In addition to the mineralisation encountered in the main mineralised structural zone, the drilling also indicated that in the most northerly Nexus hole drilled to date, there exists multiple hanging wall zones of mineralisation.
Assay results in this area included 6 metres at 4.4g/t gold, 13 metres at 4.6g/t gold, 2 metres at 10.7g/t gold and 1 metre at 14.2g/t gold.
Multiple zones of hanging wall mineralisation were also encountered in a coincident Saracen hole, where 11 metres at 2.19g/t gold was reported in addition to the main mineralised zone intercept of 2 metres at 13.9g/t gold.
The recent drill program has shown that locally the volcaniclastic package consists of shales, sandstones and conglomerates, with the units displaying varying degrees of silicification.
Gold mineralisation occurs within a sub-vertical shear zone hosted within the sediments. This mineralisation is associated with an increase in quartz veining, chlorite alteration and increase in sulphide content.
Analysis
This is an encouraging first round of drilling at Pinnacles in that it confirms width and grade of the mineralised structure is maintained at depth below the established resource.
Nexus holes have intersected the target zone where modelled, recorded high gold grades in all seven holes drilled and opened up a significant strike extent opportunity at the northern end of the project.
Mineralisation remains open at depth and along strike.
Price catalysts for the stock are set to be triggered as these extensions are followed up and geological modelling underway integrates Nexus’ drilling with that of previous operators.
As the geology is better understood, a resource drill out could be pursued with a view to a potential resource upgrade. Mining studies would then begin post a resource upgrade.
As a $6 million market cap company in jointly developing the project with a $563 million company in Saracen, Nexus is in an uncommonly advantageous position to realise the unlocked value of this underexplored tenement.
The important practical advantages of this joint venture include an Ore Sale & Purchase clause by which any Pinnacles ore mined would be processed at Saracen’s Carosue Dam gold operation, located 13 kilometres to the north.
Access to Saracen infrastructure has also been invaluable for Nexus – from both a cost and ease of operation basis.
The Nexus team stays at the Carosue Dam camp, uses its access roads to the Pinnacles site and has access to Saracen medical and emergency response teams.
Shares in Nexus have already climbed 20% this calendar year and were last trading at A$0.082.
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