Lithium explorer Hawkstone Mining (ASX: HWK) has entered the gold space after revealing it had agreed to acquire 100% of the historic Lone Pine project in Idaho.
The project was last mined in 1907 and contains a non-JORC resource of 122,666 tonnes at 18.06 grams per tonne gold for 71,128 ounces.
Hawkstone managing director Paul Lloyd said the company’s decision to diversity into the gold space was due to the investment community’s “negative sentiment” to lithium producers and explorers.
“To this end, the company has elected to build shareholder wealth via the acquisition of the Lone Pine gold project – an advanced gold project located in Idaho, US,” he explained.
“The acquisition allows us to leverage off the years of experience working in the US and the professional exploration team built up over that period.”
Lone Pine gold project
Under a binding agreement, Hawkstone will acquire Lone Pine from Inception Mining for US$510,000 (cash and scrip).
Located 10km west of Salmon, Lone Pine comprises two patented claims covering 16.77 hectares. It also includes a further 75 BLM lode claims encompassing 607ha.
The project is close to Revival Gold’s Arnett Creek and Beartrack mines and only 5km west of the historic Queen of the Hills asset and less than 1km from Teck Resources Morning Glory project which hosts the King Solomon mine.
According to Hawkstone, the project hosts numerous precious metals occurrences related to the Trans-Challis Fault System.
Inception carried out rock chip sampling, trenching and metallurgical testwork at the project between 2010 and 2013.
Better results from rock chip sampling programs were 45.67g/t gold, 35.6g/t gold 31.04g/t gold, 24.6g/t gold, 18.25g/t gold and 15.28g/t gold.
Moving forward, Hawkstone plans to diamond drill the vein zone in the historic resource area.
The program will comprise about five holes for 400m.
To fund the activities, Hawkstone will raise $1 million via a placement to sophisticated investors.
In addition to its acquisition news, Hawkstone responded to the ASX’s price query this morning, claiming it was “not aware of any loss of confidentiality regarding” the proposed project purchase.
However, the company did concede was “possible” the trading in its securities prior to entering a trading halt on 15 January “may in some part be explained by these negotiations”.
On the 14 January, Hawkstone’s share had jumped from $0.005 to $0.008.