A day after the placement and substantial shareholding notice showing a 19.9 per cent stake emerged from Fortescue (ASX:FMG), Magmatic Resources (ASX:MAG) has given the market the first indication of where it will use the millions of dollars from the deal.
Magmatic told the ASX on Tuesday that it will restart gold and copper exploration at its Wellington North project in central western NSW, close to Alkane’s gold rich Boda prospect.
Magamatic said the exploration work will comprise soil geochemistry, air core drilling and reverse circulation percussion drilling, on three areas.
The areas in the Wellington North project consist of prospects known as Boda Southwest, Lady Ilse North and Rose Hill. "All three targets have confirmed nearby porphyry gold-copper mineralisation but have limited existing drilling,“ Magmatic said on Tuesday.
Magmatic already has the Myall project (to the west of the new areas of interest) with the area of mineralisation known as Kingswood/Corvette with up to 241 million tonnes of low grade copper and gold and is in rock geologically similar to the Northparkes mine 50 kilometres to the south.
From what Magmatic said on Tuesday, the Boda Southwest -prospect is of interest because it looks like a continuation of the magnetic highs associated with intrusive complexes at Alkane’s Boda Mineral Resource, the Boda 2/3 Prospects and Boda 4 Prospect (less than 1km to the east).
Combined with its Kaiser prospect to the north, Alkane has more than 15 million ounces of gold and copper identified, with Alkane revealing last week that it had sounds of "Boda-like” mineralisation with high gold values at Kaiser (which is copper rich).
The Lady Ilse North area is sparsely explored to the north and northwest of previous drilling at Lady Ilse, "which included previous significant porphyry-style gold and gold-copper intervals,” according to Magmatic’s Tuesday announcement.
Rose Hill is an existing prospect "with known shallow porphyry mineralisation including an interval of 71 metres at 0.43 per cent copper, 0.30g/t Au & 57ppm molybdenum from the surface,” Magmatic said on Tuesday.
"Work has commenced on necessary landholder and regulatory approvals, with on-field activities expected to commence shortly at Boda Southwest,” Magmatic said.
The Wellington North exploration "will occur concurrently with a program of work at the Myall Project, to be funded by FMG Resources following the recent execution of a Farm-in and Joint Venture Agreement,” the company said on Tuesday.
