St George Mining Ltd (ASX:SGQ) recently confirmed a new high-grade nickel-copper sulphide discovery at its flagship Mt Alexander Project in the north-eastern Goldfields of WA.
Argonaut Securities has maintained its SPEC BUY recommendation on SGQ following this discovery at the newly named Radar Prospect.
Following is an extract from Argonaut’s updated report after a site visit to the Mt Alexander Project last week.
Quick Read
St George Mining (SGQ) has made a new shallow massive Ni/Cu sulphide discovery at its Mt Alexander Project in Western Australia. The first drill hole into the Radar prospect has intercepted 7.5m of massive, blebby and matrix sulphides from 44m. Handheld XRF has returned readings of up to 6.0% Ni and 1.9% Cu for one of the massive intervals. We note that handheld XRF has correlated closely to final assays to date.
The significance of this discovery cannot be understated. The Cathedrals Belt now has occurrences of shallow Ni/Cu mineralisation every 1.0-1.5km along its east-west strike. The discovery at Radar bodes well for future discoveries at the Bullets, Fish Hook and West End prospects.
Recommendation
Argonaut maintains a SPEC BUY recommendation. As SGQ is pre-resource, we do not assign a target price. In our previous report (Report: SGQ), we highlight the analogies of Mt Alexander to Glencore’s Raglan Mine. This deposit hosts Ni sulphides in numerous mineralised pods rather than traditional flows or large intrusive lenses. We see Mt Alexander as prospective for additional like-scale pods as well as significantly larger lodes.
Multiple Targets - Strong Team
Argonaut was on site last week at Mt Alexander. At surface there are a number of gossans over an extended area showing the potential for numerous more discoveries. Recent surveys have delineated over 42 targets, many of which will be tested in the current drill program.
SGQ has a strong technical team, led by geologist David O’Neill, a nickel specialist with over 20 years’ experience, incorporating time with Western Mining, BHP and Western Areas. The Company is taking a methodical approach of broad-scale targeting via geochem, airborne EM and magnetic surveys, then refining this with ground EM (MLEM, FLEM), before drill testing. Discoveries are then extended via geological interpretation and DHEM.