Emmerson Resources Ltd (ASX:ERM) made good progress in the June quarter, particularly at Hermitage in the Tennant Creek Project, where strong copper-gold indications have been returned and looks forward to starting work at the historical high-grade gold mine at Golden Forty.
“Great progress continues on a number of fronts – the most exciting being at Emmerson’s 100%-owned Hermitage project which is shaping up as one of our best copper-gold discoveries – we eagerly await the assay results,” Emmerson managing director Rob Bills said in a quarterly update to investors.
“The next quarter will build on our emerging gold royalty business with drilling commencing in the joint venture area at Golden Forty – an historic high-grade gold mine.
"Emmerson has identified several new targets at Golden Forty east and south that have the potential of adding further high-grade gold and if successful, advancing to the mining schedule which currently includes the Mauretania, Chariot and Black Snake resources.
“Noting that Emmerson receives a 6% gold production royalty on any declared mine within the JV areas, our emerging royalty business shields our shareholders from both the capital and operating expenditures plus the associated risks with moving from discovery into production.
"This is particularly relevant in the current environment where many producers are reporting escalating AISC (all in sustaining costs).”
Hermitage discoveries
The gold and copper explorer confirmed in June high-grade copper mineralisation during follow-up drilling at the Hermitage prospect in the Northern Territory, where a 38-metre intersection of new mineralisation consisting of malachite, native copper, chalcophyrite and bornite was uncovered 40 metres down from one of the drill holes.
A second hole intersected 57 metres of native copper, malachite and chalcopyrite from 127 metres, hosted in brecciated hematite-quartz-jasper ironstone, with intermittent intervals of chlorite-hematite and vuggy hematite. Assays are pending for this intersection.
Also in June, drilling hit four main zones of mineralisation including extensive malachite in hematite ironstone with voids/vugs; native copper both in the ironstone and vugs; visible gold in massive hematite-magnetite-quartz ironstone; and a new zone of chalcopyrite and bornite in quartz stockwork veins.
The hole was completed in the opposite direction to previous drilling to test below a fault encountered in a discovery drill hole in March, which returned 116 metres at 3.4% copper and 0.88 g/t gold, and confirmed that copper mineralisation continues at depth.
Examples of the new zone of mineralisation at Hermitage.
Mauretania MRE
At the Mauretania deposit within the Tennant Creek Joint Venture area, Emmerson delivered a shallow, high-grade gold mineral resource estimate (MRE) of almost 29,000 ounces at 3.5 g/t, boosting the JV’s gold inventory.
The MRE is an important part of the mining studies being undertaken by JV partner Tennant Consolidated Mining Group (TCMG) and adds to the previous Chariot MRE; with a view to commencing future mining and processing.
Mauretania offers plenty of upside with immediate resource extension potential as the deposit remains open and unexplored at depth.
Funding
The company was awarded co-funding grants through the Northern Territory Geological Survey’s (NTGS) Geophysics and Drilling Collaborations (GDC) program in June for three geophysics and drilling programs.
- Golden Forty South – aimed at refining the processing of geophysical anomalies to more accurately pinpoint drill targets.
- Golden Forty East –a diamond drill program aimed at discovering extensions to the historic, high-grade Golden Forty mine.
- High-definition drone magnetic survey in the Northern Project Area – aimed at building on the success of flying drone magnetics to target new gold and copper mineralisation.
The GDC is a competitive grants program funded by the Northern Territory Government’s $9.5 million per annum Resourcing the Territory initiative. It allocates up to $3 million to co-fund projects that address geoscientific knowledge gaps, advance exploration activity, and support the discovery and development of resources in the Territory.
Kiola funding
In New South Wales, Emmerson secured a drilling co-funding grant from the State Government for the Kiola and Kadungle projects.
This drilling grant has reduced the direct drilling costs at Kiola by 50% or $83,000 and by 50% or about $101,000 at Kadungle.
Fully funded
Emmerson's balance sheet remains strong, and the company's 2022-2023 drilling campaigns are fully funded.
It successfully raised $5.22 million from the issue of shares and had cash in hand of $9 million as of June 30, 2022.
Exploration expenditure amounting to $889,000 was fully reimbursed by its joint venture partners, while it paid a total of $123,000 to the company’s directors, which includes salaries, fees and superannuation.
Next up
Key activities planned for the September quarter include:
Northern Territory
- Completion of Phase 2 drilling at the Hermitage discovery and assay results.
- Continued Native Title negotiations to facilitate drilling of the nearby Jasper Hills copper-gold-cobalt project.
- Generation of new projects in the Southern Project Area (the SPA is the subject of the Exploration Earn-In and Joint Venture) utilising the recent high-resolution drone geophysical survey.
- Drilling for extensions and updating the resource model for the Golden Forty Mine and surrounds in the Southern Project Area (part of the EEJV); and
- Further geophysical drone surveys across key areas of the Northern Project Area.
New South Wales
- Commencement of drilling at Kiola – subject to securing a drilling contractor and within the constraints of the weather and COVID protocols.