NickelX Limited (ASX:NKL) has signed a Binding Terms Sheet with MG Resources Pty Ltd to acquire the Cosmos South Nickel Project which is located 10km south of the world-class high-grade Cosmos Nickel operations (Western Areas) and 20km North of the world class large scale Leinster Nickel operations (BHP), within the prolific Wiluna Greenstone Belt (WGB).
Pursuant to the Terms Sheet, MG Resources has agreed to grant NickelX the exclusive option to purchase the Cosmos South Nickel Project. Subject to shareholder approval, the Option is exercisable by the Company at any time from the date of the Terms Sheet until 6 months from the date of the Terms Sheet.
Subject to the exercise of the Option, NickelX will earn a 100% interest in the project by undertaking exploration expenditure of not less than $500,000 over a 24-month period and making milestone payments of $150,000 in NKL shares 12 months from the date of the Terms Sheet and $150,000 in NKL shares 24 months from the date of the Terms Sheet.
The NickelX team has quickly progressed the Fire Dragon Nickel target in the Albany Fraser Orogen (AFO) through a systematic exploration program and, as previously stated, have generated a pipeline of additional Nickel opportunities, based on our Nickel database,” Managing Director, Matt Gauci, said.
“The Cosmos South Nickel project ranked highly on our target list and following our due diligence the team believes the project represents a very compelling nickel target demonstrated by geological interpretation, strong magnetics indicating ultramafic rocks and very strong and large bedrock conductors.
“The acquisition of the Cosmos South Nickel project will position Nickel X as one of the very few companies with project areas within the prolific Wiluna Greenstone Belt outside of Western Areas and BHP Nickel West.”
Cosmos South Nickel Project Summary
Cosmos South M36/580 is situated within the highly endowed nickel rich region of the Agnew- Wiluna Greenstone belt. The belt hosts world class nickel deposits of the Leinster Nickel Operations, Mt Keith, Yakabindie, Honeymoon Well and Cosmos.
Despite being surrounded by major nickel miners, M36/580 has undergone very limited exploration and no recorded exploration reports are available. The areas of outcropping-subcropping bedrock to the south and north of the tenements have undergone considerable exploration resulting in the discovery of nickel mineralisation to the immediate south at the Taurus, Sir Samuel and Sir Tristram prospects.
M36/580 is almost entirely covered by transported alluvial deposits and no systematic drilling has been undertaken on the tenure.
Despite poor coverage over this area, First Vertical Derivative (1VD) aeromagnetic image indicates the ultramafic rocks that host the Taurus and Sir Samuel nickel mineralisation extend into the southern portion of M36/580. The magnetic ultramafic rocks also appear to strike through the northern portion of the tenement.
A MLEM survey was completed between 3 April 2017 and 5 April 2017 at the M36/580 prospect by Vortex Geophysics. The objective of this MLEM survey was primarily to map out massive sulphide targets. A total of 68 stations encompassing a total of six line kilometres have been completed at the M36/580 Prospect. The data quality is excellent throughout the survey. A significant anomalous response was identified at mid- to late delay times.
CS1 is interpreted to be multiple large conductors with modelled conductance of 6000 Siemens to 12000 Siemens. The time constant is estimated to be around 500ms consistent with massive sulphides conductors. Another anomalous response to the south is interpreted to be SPM effect which is caused by fine grain ferromagnetic minerals close to the surface.
The MLEM survey was followed up by a Fixed Loop EM survey. The CS1 MLEM conductivity anomaly was confirmed by the FLEM survey. The FLEM survey shows a large bedrock conductor with a strike length of 565m and depth extent of 850m.
The modelled conductance of FLEM plate is interpreted to be 11300 Siemens consistent with MLEM survey. The depth to the top conductor is interpreted to be around 80m below surface which is deeper than the MLEM survey which was interpreted to be around 50m below the surface. The dip of this conductive source is interpreted to be steeply (73 degree) dipping to the west. The estimated time constant of 700ms and modelled conductance of 11300 Siemens are consistent with massive sulphides source.
