Prior to Northern Star’s ownership, Sipa Resources (ASX: SRI) mined the project between 1998 and 2004 – producing 350,000 ounces of gold during that time at an average grade of 3.3 grams per tonne.
In readiness for an extensive drilling program, Kalamazoo has secured former Northern Star geologist Matthew Rolfe and economic geologist Dr Margy Hawke, who have both stepped into senior exploration geologist roles for Ashburton.
Former Spectrum Metals’ managing director and current Kalamazoo director and project manager Paul Adams will be leading the Ashburton exploration team, which aims to “substantially increase” the project’s existing 1.65 million ounce oxide and sulphide gold resource.
Mr Adams said the company was “extremely pleased” to have completed the acquisition of Ashburton.
“In recent weeks, we have established a very experienced project team and will now look to expand the existing 1.65Moz gold resource and progress development plans for what we consider will be a transformational project for Kalamazoo and shareholders,” Mr Adams added.
Located on the edge of the Pilbara Craton in WA’s north, Ashburton encompasses 217 square kilometres of tenements.
The project has a JORC resource of 20.8Mt at 2.5g/t gold for 1.65Moz.
Kalamazoo claims the asset comes with a large database of drilling, geological, geochemical and geophysical information including numerous walk-up drill targets.
Part of the asset’s appeal are an existing self-contained camp, core farm and supporting infrastructure.
Another advantage of the acquisition is Kalamazoo makes its first payment of $5 million after it has mined an initial 250,000t of ore from the project – leaving Kalamazoo with more cash during the crucial exploration phase to advance the asset.
Kalamazoo will also pay a 2% net smelter royalty on the first 250,000oz gold produced, which will decrease to 0.75% on all gold generated thereafter.
With a history of past production and an existing resource, Kalamazoo believes Ashburton has “significant” greenfield and brownfield exploration potential.