PNX Metals Ltd (ASX:PNX) has commenced drilling at the Barossa gold-silver-zinc targets located within the Burnside Project in the Pine Creek region of the Northern Territory.
A cluster of volcanogenic massive sulphide (VMS) style electromagnetic anomalies have been identified.
The anomalies are consistent with concentrations of massive sulphides.
Two initial diamond drill holes for a total of 235 metres are proposed to test the highest-priority electromagnetic responses.
Drilling will take 10 days to complete with assays expected in November.
James Fox, managing director, commented: “The Barossa electromagnetic conductors have been modelled at relatively shallow depths, are consistent with concentrations of massive sulphides, and are situated in a new and untested target area less than 20 kilometres from the Hayes Creek project.”
Background
PNX’s focus is on its four projects located in the Pine Creek Region, 180 kilometres south of Darwin.
- Hayes Creek Project (flagship);
- Burnside Project;
- Moline Project; and
- Chessman Project.
The Hayes Creek project contains the Iron Blow and Mt Bonnie gold-silver-zinc deposits, located less than 3 kilometres apart and situated on granted mineral leases wholly owned by PNX.
The Hayes Creek pre-feasibility study is fully funded and due for completion by May-2017.
It will expand on the scoping study completed in March 2016, which found that mining and processing ore derived from the proposed open-pit and underground operations at Hayes Creek would generate strong financial returns for PNX.
Hayes Creek drilling update
Base metals and silver assays from the remaining 23 holes drilled at Mt Bonnie are due shortly.
Infill diamond drilling at Iron Blow, also part of the Hayes Creek project, is proceeding well with drilling intercepting massive sulphide mineralisation as predicted in the geological model.
Drilling at Iron Blow is expected to continue into December 2016.
Analysis
The exploration drill program at Barossa, if successful, has the potential to create substantial value for PNX shareholders.
Furthermore, the program is co-funded by the Northern Territory government meaning PNX are keeping shareholders leveraged to exploration upside for minimum cash outlay.
The geological setting of the Barossa targets is consistent with that observed at Iron Blow and Mt Bonnie.
The coming months are set to be a busy period for the company with multiple drill programs generating regular news flow.
Shares in PNX are up 130% year to date, currently trading at $0.023.