Nexus Minerals Limited entered into a Farm-in and Joint Venture Agreement (the Agreement) over the Pinnacles Gold Project (the Project) with Saracen Gold Mines Pty Ltd, a subsidiary of Saracen Mineral Holdings Limited (Saracen) in September 2015. This investment is consistent with the Company strategy of investing in advanced gold exploration assets.View ASX Announcements
The Project contained a JORC-2012 compliant resource, completed by Saracen, of 413,000t @ 2.1g/t Au for 28,000oz gold (see Saracen Mineral Holdings Limited’s ASX release 9 October 2014 ‘2014 Mineral Resources and Ore Reserves’ and ‘2014 Mineral Resource and Ore Reserve Statement Explanatory Notes and Table’). The JORC-2012 compliant resource has now been upgraded following Nexus’ extensive work to 550,000t @4.6g/t for 82,000oz from surface to 350m (see table 1) (ASX release 13 October 2016 - Nexus Pinnacles JV Gold Project Resource Increased by 193%) .
The Agreement includes an Ore Sale and Purchase Agreement, whereby any future ore mined from the Project tenement will be purchased by Saracen for processing through its 2.4Mtpa CIL processing plant at Carosue Dam – 13km to the north of the project area. Under the Agreement, Nexus is the sole manager of the Pinnacles Gold Project and has earnt 85% of the Project, hence satisfying the final staged farm-in milestone. Nexus and Saracen are now part of a contributing joint venture with contributions made relative to the percentage ownership. Nexus reached 88% ownership during the September 2017 quarter.
The Pinnacles Gold Project is located in the Eastern Goldfields of Western Australia, some 100km northeast of Kalgoorlie-Boulder. The project is located on a granted Mining Lease, M28/243 (expiry 2031), that covers an area of 8km2. The tenement lies 13km to the south of Saracen’s Carosue Dam Mine facility. The tenement is surrounded on all sides by Nexus 117km2 tenement package (see ASX release 23/4/2015). Access into the project area is from the Carosue Dam Mine site via existing Saracen access roads and station tracks. The tenement is immediately to the south of, and in conjunction with Nexus regional tenement package is contiguous with, Saracen’s Carosue Dam mining tenements, which includes the Whirling Dervish and Karari gold mines, currently in operation.
The joint venture tenement exhibits historic gold mine workings and multiple parallel mineralised structures. Gold mineralisation occurs within a sub-vertical shear zone and is associated with quartz veining and sheared altered host rocks.
There are a number of small shafts that have been worked in the early 1900’s extracting gold bearing ferruginous quartz. There has been limited exploration undertaken on the tenements by a number of companies from the early 1980’s to present, but only in the search for shallow oxide gold potential.
The Pinnacles Project area covers part of a highly deformed Archaean greenstone sequence of basalts, dolerites, and co-magmatic high-level intrusions. This mafic volcanic association is overlain by a series of medium to coarse grained volcaniclastic sandstones and subordinate felsic volcanic rocks. These greenstones have been intruded and disrupted by the forceful intrusion of a series of granitoid rocks.
The tenement comprises predominantly underlying basalt, with felsic volcaniclastic sandstone and local conglomerate horizons. The sandstone is often ferruginized or laterized. The two main areas of workings (east and west zones) exhibit black slate within the basalt sequence. The outcrop in the area of these workings is either gossanous ironstone or laminated grey chert. A lateritic profile up to 10m thick is exposed on the northern part of the tenement, whilst to the south the laterite has been stripped exposing extensive alluvial flats.
The Pinnacles project lies in the eastern part of the Norseman-Wiluna greenstone belt, and is part of the Kurnalpi terrane subdivision of the Eastern Goldfields Superterrane. The project area covers a major regional shear zone that is part of the Keith-Kilkenny Lineament. This same structural setting hosts the Luvironza, Whirling-Dervish, Karari, Twin Peaks and Monty Dam deposits. The Whirling-Dervish and Karari deposits are currently being mined by Saracen Gold Mines.
The district scale structure also shows the dominant regional northwest structural orientation being re-oriented through north to north-northeast, in particular due to the regional scale granite doming events. The extensional event that is associated with the granite doming plays a major role in the creation of sites favourable for gold deposition. The distribution of gold mineralisation is structurally controlled, and the timing, style and reactivation of structures are major factors in determining the size of deposits.
The Pinnacles project gold mineralisation occurs within a sub-vertical shear zone hosted within volcaniclastic sandstones. It is associated with quartz within the sheared altered host rocks. There appears to be a sub-vertical and a sub-horizontal control on the mineralisation. Sub-vertical mineralisation reported to be associated with quartz-albite-pyrite alteration, while the flatter shallow dipping mineralisation shows a strong hematite-carbonate-pyrite alteration association.
Current Mineral Resource
The Project contains a JORC-2012 compliant resource, of 550,000t @ 4.6g/t Au for 82,000oz gold (see ASX release 10 October 2016 - Nexus Pinnacles JV Gold Project Resource Increased by 193%). The Resource is defined to a depth of only 350m.
IMPORTANT NOTE: No Ore Reserves have currently been defined on the Pinnacles Gold Project. There has been insufficient exploration and technical studies to estimate an Ore Reserve and it is uncertain if further exploration and/or technical studies will result in the estimation of an Ore Reserve. The potential for the development of a mining operation and sale of ore from the Pinnacles Gold Project has yet to be established.