Kalamazoo Resources acquires Ashburton project and 1.65Moz gold from Northern Star
The 217sq km project currently holds a JORC Code (2012) resource estimate of 20.8 million tonnes at 2.5 grams per tonne gold for a contained 1.65 million ounces. The project has already produced 350,000oz of gold.
Kalamazoo said the project has significant regional greenfield and brownfield exploration potential, and comes with a large database of drilling, geological, geochemical and geophysical detail. There are also numerous walk-up drilling targets.
The exploration team will be led by Kalamazoo’s director Paul Adams, who was previously managing director at the former Spectrum Metals which was taken over in March by Ramelius Resources (ASX: RMS). Mr Adams was involved in the Penny West gold discovery.
Kalamazoo will pay Northern Star up to $17.25 million deferred cash consideration. This payment is contingent on 250,000t of ore being mined and 250,000oz of gold produced. There is also a 0.75% royalty payable to Northern Star on any subsequent gold being produced. Similar royalty structures will apply to other metals produced on the tenements.
Exploration to start immediately to increase resource
Exploration will begin immediately. Ashburton comes equipped with a self-contained camp, core farm and supporting infrastructure.
Kalamazoo said it will be looking to substantially increase the existing 1.65Moz oxide and sulphide resource and to advance project development plans.
Kalamazoo chairman and chief executive officer Luke Reinehr said the purchase was a “tremendous” outcome for the company’s shareholders.
“Kalamazoo is in the unique position of having major assets in two of the most highly rated gold exploration provinces in the world today — the Victorian goldfields and the Pilbara,” he added.
Earlier this month the company completed its first large-scaled, gold focused exploration at The Sisters project, which has similar geology and along strike to the recent Hemi discovery in the Pilbara by De Grey Mining (ASX: DEG).
The Sisters lies north of the newly acquired Ashburton ground. Kalamazoo has recently completed project wide geochemical and airborne magnetic surveys at The Sisters covering a structural corridor 14km in length. Results are expected soon.
In Victoria, Kalamazoo has its Castlemaine project south-west of Fosterville and the South Muckleford project in the historic Maldon goldfield, where wide scale ultra-fine soil sampling programs are being undertaken in collaboration with the CSIRO.
The results from these programs are expected shortly and will be a key factor in designing Kalamazoo’s upcoming Victorian drill programs.