The new year has begun with strong momentum for junior gold explorer Hardey Resources (ASX: HDY). Following a review of its recently-acquired Grace Project, Hardey reports that its tenements in Western Australia demonstrate “significant untested IP anomalies and open-ended gold mineralisation,” in a market update to shareholders.
Hardey has also published rock-chip sample results as high as 52.3 g/t gold and 29.49% copper and says that “large IP anomalies remain untested.”
The Grace Gold Project is located close to the Newcrest-owned Telfer Mine, which is known to contain around 32 million ounces of gold and around 1 billion tonnes of copper. Hardey’s tenements are also within 25km of a gold mill that could potentially serve as a suitable processing facility in future.
Hardey reports that its tenements in the Grace deposit have been drilled along 450-500 metres of strike and 90m across strike to an average depth of 73.4m. Also, there is confirmed high-grade shallow oxide gold mineralisation commencing from surface over the project area.
Late last year, Hardey acquired a series of tenements in the region and is now pushing forward with developing its most highly-prized prospects. The Grace Deposit has been mined by Newcrest since the 1970’s, but for the first time in 40 years, the Grace Project could now be consolidated under the ownership of an ASX junior, in the form of Hardey.
After reviewing the historical data already available, Hardey believes it has acquired an “extremely valuable asset with strong geological support for significant additional discovery of both gold and copper mineralisation”, and is confident that major exploration upside exists for mineralisation along the entire major Grace-Bemms shear.
Macro factors boosting gold commercialisation
Gold priced in Australian dollars has remained stable in recent years as the gold market has swung back into cyclical expansion.
Macroeconomic developments have presented Australian-based gold miners with excellent opportunities to pick-up strong gold projects at the low end of the gold cycle, and develop them into profitable mining operations — alongside a broad-based recovery in base metals.
Larger Australian gold miners have been quick to take advantage of the cyclical swing in gold market fortunes. Northern Star bought five new mines widely acknowledged as world-class and highly viable assets at the low-point of the gold market, including Newmont’s Jundee mine.
Elsewhere in Australia, shuttered mines like Saracen’s Thunderbox mine in Western Australia, have reopened in the last twelve months after almost eight years of market-imposed hibernation. Both Evolution and OceanaGold have seen their respective market capitalisations surge from about $600 million in mid-2013 to about $2.4 billion today. From a $79 million small-cap in July 2013, Saracen has blossomed into an $830 million mature miner.
The superlative performance figures demonstrated by mature Australian gold miners have astounded even bullish analysts, and welcomed aspirational juniors like Hardey to follow suit.
“The technical team at Hardey are excited by the outcome of the desktop review, which highlights the high-grade nature of mineralisation at the Grace Gold Project and appears to remain open in all directions and at depth. While the project area is still in its early stages we see huge upside through diligently exploring one of Newcrest’s forgotten gems,” said Terence Clee, Executive Director at Hardey Resources.
“The re-processed IP data has come up with some big targets; and combined with our new tenement applications taking our overall landholding to 1,651 square kilometres in a major gold province, its shaping up to be an exciting area play in the mineral rich Telfer Region,” he added.