Red 5 Limited (ASX: RED) has exercised an Option to complete the acquisition of the Cables and Mission gold deposits, located approximately 10km north of the company’s Darlot Gold Mine in Western Australia.
Managing Director, Mark Williams, said the strategic acquisition forms part of Red 5’s multi-strand strategy to expand the Darlot Mineral Resource base, which includes ongoing near-mine and regional exploration as well as consolidation of strategic opportunities.
The acquisition of the Cables and Mission deposits follows the completion of due diligence and confirmatory Reverse Circulation (RC) drilling to validate historical drilling and determine the potential of the Cables and Mission deposits.
The Cables and Mission transaction also follows last month’s acquisition of the Great Western gold deposit.
Mr Williams said the Cables and Mission deposits represent a low-risk opportunity to continue growing the company’s Resource base in the area surrounding the Darlot gold processing plant.
We are delighted to have completed this transaction, which marks another milestone in our Darlot Mining Hub Strategy,” Mr Williams said.
“The acquisition includes a JORC 2004 Inferred Resource which we plan to upgrade to JORC 2012 compliance, while at the same time commencing exploration activities aimed at testing the broader potential of the tenements, which are located in close proximity to our existing Darlot operations.
“Significantly, the rock units hosting the Cables and Mission deposits are similar to those that host the Centenary orebody, which has been mined for many years from underground at Darlot.
“The Cables and Missions transaction follows the recent acquisition of the Great Western gold deposit, both of which are planned to provide additional sources of ore feed for the Darlot processing plant in the coming years,” he said.
The new acquisition area totals 38.7 sq. km and includes the Cables and Mission gold deposits, which were last reported by Leopard Resources NL on 5 February 2014 to contain total combined JORC 2004 Inferred Resources of 185koz.
Further drilling will be required to better define the mineralisation and to upgrade the existing JORC 2004 Resource to comply with the reporting guidelines of JORC 2012. The Cables and Mission deposits are ultimately planned to be mined and trucked to Red 5’s Darlot processing plant, located approximately 10km to the south (Figure 1).
The Cables and Mission deposits are hosted within similar rock units, including magnetic dolerite, that host the Centenary orebody 10km to the south. These magnetic dolerite units are an important host rock in the Darlot mine area and have historically produced high gold grades with good recoveries (typically >93%) through the Darlot processing plant.
The Cables and Mission gold deposits have a reported combined estimated JORC 2004 compliant mineral resource totalling 1.5M tonnes at 3.8g/t Au for 185,400 ounces of contained gold.
Red 5 is currently in the process of planning further drilling to define the mineral resource in accordance with the JORC Code 2012.
