Aurumin builds on Sandstone footprint with new high-grade gold tenement

Aurumin (ASX: AUN) has continued its Western Australian minerals exploration refocus with the award of a new strategic high-grade tenement at its flagship Sandstone gold project.

The new licence, E57/1254, contains three historic gold mines and adjoins Aurumin’s E57/1140 permit in the central Sandstone gold project area.

The Queen of the Range, Welcome and Phoenix mines were operated in the early 1900s and produced 197 tonnes of ore at 10.58 grams per tonne gold, 376t at 27.45g/t gold and 82t at 5.92 g/t gold respectively.

More recent exploration work has confirmed there is still high-grade gold potential within E57/1254.

Rock chip samples of up to 8.5 g/t gold have been obtained by several operators since the early 2000s.

While recent drilling returned low-level results it is believed that may be related to the fact that previous operators had targeted the historical shafts.

Desktop studies underway

Managing director Brad Valiukas revealed that in preparation for more in-depth on-the-ground exploration work in the permit, Aurumin has been undertaking desktop studies compiling and validating data for the project areas.

This includes assessing data the company sourced from open file reports it inherited as part of its Sandstone project acquisition. It now plans to extend mapping and surface sampling in the area.

“Following recent divestments, the company has a clear focus on advancing our flagship 946,000-ounce Sandstone gold operations and generating the critical mass for future production,” Mr Valiukas said.

“We are pleased to be further solidifying our footprint in the Sandstone region with this additional tenement grant.”

Previous tenement awards

The E57/1254 grant follows Aurumin’s recent success in significantly expanding its landholdings at Sandstone with the award of three other new tenements.

These three tenements – E57/1294, E57/1302 and E57/1371 – are part of the 881,000oz Central Sandstone gold project.

The associated Birrigrin and Johnson Range gold projects bring the total resource for Sandstone out to 946,000oz.

The Sandstone gold operation was the centrepiece of Aurumin’s acquisition of the project in early 2022.

The project includes significant infrastructure and an expanding tenement footprint where the company aims to support a gold mining operation in the future.

Historically rich gold area

The E57/1294 tenement adjoins the central Sandstone mining tenements to the north-east and contains the Hacks Creek structure running north-northwest through its length.

The E57/1302 and E57/1371 tenements build on the greenstone trend that hosts the Bellchambers, Bulchina and Golden Raven mineralisation.

The historical Muriel Chapman mine within E57/1371 was worked in the early 1900s and reported 106t of ore at 15.1g/t for 51.5oz of gold.

The two tenements have only been explored by historical surface sampling work, although E57/1302 is largely untested by drilling with only six drill holes known to have been completed to date, while E57/1371 has had 22 historic first pass rotary air blast holes completed.

Divestment of non-essential projects

At the same time as it has been building up its Sandstone position, Aurumin has been busy divesting interests in non-essential projects and solidifying its cash position.

In late December, the company successfully wrapped up the sale of its Mt Dimer mining leases and miscellaneous licences in Western Australia to Beacon Minerals (ASX: BCN) to help it improve its balance sheet.

With the conclusion of the deal initially announced in mid-November, the company is receiving a cash consideration of $3 million.

It is also eligible for a 2% net smelter return royalty on the Mt Dimer mining tenements on gold production above 12,000oz, as well as on all other minerals.

Another recent cash positive transaction saw Aurumin receive firm commitments for a placement to raise a total of $1.25m from Collins St Asset Management, Middle Island Resources and 7 Enterprises.

The company is now net-debt-free and well placed to further focus on its Sandstone gold strategy in 2024.