Pinnacles JV Gold Project (with ASX:NST)
Pinnacles Joint Venture
The Project contained a JORC-2012 compliant resource, completed by Northern Star Ltd (NST), 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 updated following Nexus’ extensive work to 609,000t @4.0g/t Au for 78,000z from surface to 350m. This comprises of open put of 159,000t @ 2.4g/t Au for 12,000oz and unground 450,000t @ 4.6 g/t Au for 66,000oz (see ASX release 27 February 2020 – Nexus Pinnacles JV Gold Resource Update).
The Agreement includes an Ore Sale and Purchase Agreement, whereby any future ore mined from the Project tenement will be purchased by NST 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 achieved 90% ownership of the Project during the March 2020 quarter. Nexus and NST are part of a contributing joint venture with contributions made relative to the percent ownership.
LOCATION
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 Northern Star’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 NST access roads and station tracks. The tenement is immediately to the south of, and in conjunction with Nexus regional tenement package is contiguous with, Northern Star’s Carosue Dam mining tenements, which includes the Whirling Dervish and Karari gold mines, currently in operation.
Geology
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 Northern Star. 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
Pinnacles is situated in the Eastern Goldfields, 120km northeast of Kalgoorlie, and 13km south of Northern Stars’ Carosue Dam Operations. The deposit is hosted within tenement M28/243, held in a contributing JV between Nexus (90%) and Northern Star Resources (10%). The Pinnacles Gold Deposit has a JORC 2012 combined mineral resource of 609,000t @ 4.0g/t Au for 78,000 ounces. (refer to ASX release 27/02/2020)
Table 1: Pinnacles Gold Deposit JORC 2012 Combined Mineral Resource Estimate (ASX:NXM 27/2/2020)
The mineralisation at the Pinnacles Gold Deposit occurs within a sub-vertical shear zone hosted within volcaniclastic sediments. It is associated with quartz veining (2-5%), sulphides (2-5%) and sheared chlorite / carbonate / hematite altered host rocks.
The deposit is comprised of two domains (Figure 4) with simple geometry that is well defined and understood. Domain 1 is more constrained with higher grades when compared to domain 2 (see figures 6a and 6b).
Historic drill intercepts from surface down to approximately 300m (remains open at depth) include: (ASX:NXM 21/1/2016, 6/5/2016, 9/9/2016, 13/10/2016, 28/10/2016, 7/2/2017)
- 5m @ 20.9g/t Au Domain 1 (from 88m);
- 4m @ 19.5g/t Au Domain 1 (from 86m);
- 6m @ 17.4g/t Au Domain 1 (from 154m);
- 6m @ 12.3g/t Au Domain 1 (from 166m);
- 6m @ 11.5g/t Au Domain 1 (from 128m);
- 35m @ 3.7g/t Au Domain 2 (from 130m);
- 17m @ 3.2g/t Au Domain 2 (from 151m); and
- 25m @ 2.3g/t Au Domain 2 (from 139m).
The Pinnacles Gold Deposit is uniquely positioned for low cost and rapid development should mine studies support favorable economics. Mining License M28/243, which hosts the deposit, is subject to a binding Ore Sale and Purchase Agreement with Northern Star Resources, requiring them to purchase, and Nexus Minerals to sell, any ore produced from the Pinnacles JV tenement. The ore would be processed through the Carosue Dam mill, located 13 km to the north, connected by a granted miscellaneous license and existing Northern Star infrastructure. Critical studies including geotechnical assessments, ground water and waste rock characterisation have been completed. Metallurgical studies have shown recoveries to exceed 97%. Flora, fauna, and heritage surveys have all been completed and cleared for the project, and a clearing permit has been approved.
Nexus has engaged several mining and support services contractors to refine mine planning and improve cost estimates. This information will underpin the updated underground mine study which is due for completion in the December quarter.
Table 2: Pinnacles Gold Deposit Selected Historic Significant Intercepts
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.
Historic Workings
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.
