C29 Metals Ltd (ASX:C29) is preparing to undertake its first-ever drill program at Reedy Creek Project in the Eastern Lachlan Fold Belt of Central West NSW, just weeks after the company made its debut on the ASX.
The company, which raised $5 million through the issue of 25 million shares at an issue price of $0.20 per share, was admitted to the Official List of ASX on November 1, 2021.
C29 is in the process of changing the ownership of the project and has applied for regulatory approvals to undertake drilling around the Reedy Creek mine area.
A drilling contractor will be assigned, with the commencement of drilling expected early to mid-December.
Detailed review
The company completed a detailed review of historical exploration reports that revealed the potential for sulphide-rich polymetallic skarn, breccia hosted gold-base metal and epithermal gold deposits in a number of structural and lithological settings at the historic Reedy Creek Mine and the Endeavour 1, Mossvale and Kala prospects.
C29 executive director Mark Major said: “The identification of the strong polymetallic loads within the historic drilling at the old Reedy Creek mine is fantastic.
"The exciting part is that only a small proportion of the area was drilled.
"Many of the holes are very shallow, showing substantial mineralisation within the lower part of the hole. Those that were drilled deeper had significant results.
Acquisition of tenements
The company acquired 100% legal and beneficial interest in a number of tenements, which will comprise four separate projects.
It plans to increase shareholder wealth through undertaking systematic exploration activities on the projects and the acquisition, exploration and development of resources projects throughout Australia.
The projects are:
➢ The Sampson Tank Project in New South Wales;
➢ The Reedy Creek Project, also in NSW;
➢ The Torrens Projects in South Australia; and
➢ The Stadlers Project in Western Australia.
Key business objectives
The company’s main objectives following its ASX debut are:
➢ To test previously identified priority drill targets at the projects;
➢ Identify additional priority drill targets by undertaking high-level exploration activities at the projects;
➢ Through exploration success, evaluate opportunities for near term copper production; and
➢ Seek further exploration, acquisition and joint venture opportunities in Australia and elsewhere that have a strategic fit and have the potential to deliver growth for shareholders.
Sampson Tank Project
The Sampson Tank Project in the world-class Lachlan Fold Belt, within the southern portion of the Ordovician Girilambone Basin in Central West New South Wales, is about 130 kilometres northwest of Parkes and 20 kilometres northwest of Tottenham.
Targets identified to date support the concept of deformed and remobilised Besshi-type volcanic associated massive sulphide (VAMS) mineralisation.
Limited historical in-ground exploration has occurred at the Sampson Tank tenement and offers the potential to define a VAMS hosted copper (±gold) deposit.
About 20 kilometres away are both Helix Resources Ltd’s Collerina Discovery copper-gold and Mincor Resources NL (ASX:MCR)’s Tottenham copper-gold deposits.
Reedy Creek Project
About 20 kilometres west of the township of Cudal in the eastern Lachlan Fold Belt of Central NSW, the project is 60 kilometres west of Orange, a major regional centre.
The Reedy Creek Project is considered prospective for hydrothermal polymetallic (gold-copper-lead-zinc-silver) deposits associated with the Middle Devonian Dulladerry Volcanics, within the Lachlan Transverse Zone.
Historical exploration data has identified potential for sulphide-rich polymetallic skarn, breccia hosted gold-base metal and epithermal gold deposits in a number of structural & lithological settings within the tenement.
Several are ready for drill testing.
Torrens Projects
The Torrens Projects comprise two exploration licence applications, which collectively cover 1,768 square kilometres in the Olympic Dam iron oxide copper-gold (uranium) province of the Stuart Shelf in central South Australia.
One project is about 50 kilometres of the BHP’s IOGC Olympic Dam Mine and recently discovered Oak Dam Project and adjacent to other IOCG discoveries including FMG/TAS Volcan Project and ARE/AIS Lake Torrens Project.
Historical exploration has intercepted copper mineralisation and exhibited sizable host environments and alteration while geophysical modelling has identified multiple high-quality IOCG targets.
Previous drilling at West Mount intersected copper mineralisation (28 metres at 0.34% copper) with IOCG alteration and granitoid breccias.
The Stadlers Project
The Stadlers Project is in the Ashburton Basin of WA, about 60 kilometres south of Paraburdoo, near Mt Boggola.
Historical results are prospective with copper rock chip samples and drilling intersections encountered, including B49 with 9 metres at 1.86% copper from 47 metres depth.
Despite having historical exploration, a clear mineralisation model has not been developed for the prospect nor has the mineralisation been closed off; while an 800 metres long EM conductor anomaly remains untested.
The current geological model is believed to be associated with a sedimentary exhalative (SedEx) style mineralisation, which are fed via deep sourced fluids, but none have been explored for and thus identified yet.
Acquisition deal
The company bought the tenements from various unrelated third parties for cash and shares, as well as net smelter return royalty.
Further, it has agreed to pay a 2% net smelter return royalty to Gilmore Metals Pty Ltd and the shareholders of Oberon Gold Pty in respect of any future production within the area of the tenements comprising the Sampson Tank Project (Sampson Tank Royalty) and the Reedy Creek Project (Reedy Creek Royalty).
The royalty terms will also give the company the right (but not the obligation) to purchase, within the first 12 months after a decision to mine has been made, 50% of the Sampson Tank Royalty and the Reedy Creek Royalty from Gilmore Metals and the shareholders of Oberon Gold respectively for either (at C29's election) $1 million in cash or that number of shares equal in value to $1 million based on a deemed issue price equal to the 30-day VWAP of shares.