Antipa Minerals (ASX: AZY, Share Price: $0.028, Market Cap: $30m) maintains a first-class acreage position within the mineral-rich Telfer province of Western Australia – a fact reflected in the lucrative agreement with mining behemoth Rio Tinto Exploration, which allows for Rio to spend up to $60 million on exploration and appraisal of Antipa’s Citadel gold and copper project within the Telfer region.
Antipa has just advised that its Phase 2 Citadel exploration program has commenced, incorporating up to 6,000 metres of RC drilling. Its aim is to deliver additional discoveries and also extend the limits of the known gold-copper-silver mineralisation around the Calibre and Magnum deposits.
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Market Significance
Antipa’s share price has experienced significant volatility – from a 12-month low of $0.01 to a recent high of $0.068 and then a subsequent retracement. The primary driver over recent months has been drilling activity surrounding the company’s Minyari deposit, situated just 40km from Newcrest Mining’s (ASX: NCM) Telfer gold processing infrastructure. The market has been busy interpreting a steady stream of results from the Minyari drilling program. Attention will now be focused on RC drilling at Citadel of up to 12 target areas, with the planned completion of between 30 to 40 RC drill-holes totalling 6,000 metres.
Announcement Detail – Citadel Project Update
Antipa Minerals has announced that it’s Phase 2 2016 Citadel exploration program, which is being fully-funded by Rio Tinto Exploration, commenced on 30th October.
The RC drilling component of the program will involve the testing of up to 12 high-priority target areas, with the completion of between 30 to 40 RC drill-holes for a total of up to 6,000 metres (with an average hole depth of 150 metres). The targets include:
o IP Targets: 24 drill-holes testing eight targets primarily based on IP chargeability anomalies
o Rimfire Area Targets: 14 drill-holes testing Rimfire area targets with varied geophysical target criteria (i.e. IP and/or magnetic and/or VTEM conductivity anomalism)
o Magnetic Targets: one drill-hole testing the strongest magnetic high anomaly within the Citadel Project, i.e. ‘Hansel’
o Geology Targets: two drill-holes testing two geology targets, i.e. ‘Katinka’ and ‘Corker’.
Technical Significance
The 2016 exploration program Phase 1 IP survey screened and prioritised a selection of high-priority targets within an extensive 450 sq km region of the Citadel Project – including the Calibre, Magnum, Corker, Trigger, Meekus and the broader Rimfire area. The objectives of the Phase 2 RC drilling program are to deliver additional discoveries and also extend the limits of known gold-copper-silver mineralisation within the vicinity of the Calibre and Magnum deposits.
The drilling program is expected to commence in October and be completed during December. As usual, samples will be batched and sent for assay on a periodic basis and announcements will be made periodically as assays are received. The final batch of laboratory assays is expected to be received within two months following completion of the drilling program.
Capital Raising – Placement & SPP up to $7.6 million
Antipa has announced a Placement to institutional and sophisticated investors that will raise up to $5.63 million, along with a Share Purchase Plan (SPP) that will raise up to $2 million. The funds raised will help fund exploration on the company’s 100%-owned North Telfer Project, which hosts the high-grade gold/copper Minyari and WACA deposits, along with the Judes prospect.
The Placement comprises the issue of up to 216.7 million shares at $0.026 per share, representing an 18.8% to the pre-issue trading price of $0.032. The initial component of the Placement of $3.63 million has already been settled with Australian investors and the new shares commenced quotation today (1st November 2016).
Sprott Group has provided a firm commitment to place $2 million worth of new shares with its affiliates and clients, with settlement due in approximately three weeks’ time. Sprott is a leading North American-based asset management firm with a strong track record of identifying and funding successful early resource companies.
Project Overview
The company’s Citadel and North Telfer projects are located within the Paterson Province in northwest Western Australia, 400 km east of Port Headland. The Paterson Province is considered to be highly prospective, but grossly underexplored. It hosts several world-class mineral deposits situated within 150 km of Antipa’s Citadel and North Telfer projects – with the most prolific including Australia’s third-largest producing gold-copper mine – Newcrest’s Telfer operation, as well as Aditya Birla’s Nifty copper mine.
Antipa owns a 1,335 sq km package of prospective granted tenements within the Proterozoic Paterson Province of Western Australia, known as the Citadel Project. The Citadel Project is located approximately 75km north of Newcrest’s Telfer gold-copper-silver mine and includes the gold-copper-silver±tungsten Mineral Resources at the Calibre and Magnum deposits and high-grade polymetallic Corker deposit.
The company also maintains an additional 1,310 sq km of granted exploration licences, known as the North Telfer Project, which hosts the high-grade gold-copper Minyari and WACA deposits and extends its ground holding within the Paterson Province to within 20km of the Telfer mine and 30km of the O’Callaghans tungsten and base metal deposit.
Antipa has also acquired from the Mark Creasy-controlled company, Kitchener Resources Pty Ltd, additional exploration licences within the Paterson Province that are now all granted and cover 1,573 sq km, along with a further 138 sq km of exploration licences that are known as the Paterson Project, which come to within 3km of the Telfer mine and 5km of the O’Callaghans deposit.
Summary
We initiated coverage of Antipa Minerals around $0.024 during October 2015. The company is already well advanced in terms of its exploration status, boasting a sizeable existing 1.6M gold-eq oz JORC-compliant resource. There’s little doubt the resource will continue to grow, so it now becomes a question of scale, grades, potential development economics. The Rio farm-in deal provides near-term funding certainty and also ensures active exploration. The Rio JV reflects the underlying resource potential of the Citadel project, which lies just 75km north of Newcrest’s Telfer gold-copper-silver deposit. Meanwhile the current capital raising will provide certainty with respect to the company’s other projects.
