After joining ASX ranks in July, OZZ Resources (ASX: OZZ) has already debuted a maiden resource for its Maguires gold project and revealed today it had scooped up the “highly prospective” Leonora project – expanding its footprint in a well-known Western Australian “tier one” gold district.
The company is acquiring the Pinnacle Well project which covers 95 square kilometres and is less than 30km north of the town of Leonora and 12km to the east of its existing Mt Davis asset.
OZZ managing director Jonathan Lea said he was excited by the potential at Pinnacle Well, which he believes could host gold and base metal minerals.
As part of the acquisition arrangement, OZZ will pay the vendor $75,000 in cash and issue a further 750,000 in shares as part of the settlement.
OZZ can earn a 75% stake in Pinnacle Well by spending $750,000 on exploration over 2.5 years. Following OZZ’s earn in, the joint venture will be formed, and the vendor will be free-carried to conclusion of a feasibility study.
According to OZZ, Pinnacle Well has seen limited exploration and drilling due to the presence of alluvial cover.
However, the vendor undertook sampling and mapping across the project and identified gold, base metals, and molybdenum.
Rock chip sampling of exposed quartz veins has returned up to 12 grams per tonne gold, along with elevated silver and bismuth levels.
Immediately south of Pinnacle Well are the Gambier Lass workings which have recorded production of 10,000 ounces of gold at 1oz per tonne.
OZZ noted the hosting structure of these workings the Pig Well Graben trends into Pinnacle Well and presents a drill target following geochemical sampling and geophysical surveying.
The company will begin the geochemical and geophysical programs at Pinnacle Well early next year, with the goal of kicking off a drill program before June.
Synergies with Mt Davis
With Mt Davis only 12km from Pinnacle Well, OZZ sees operational synergies for the assets.
Both projects are located in the Leonora district which is well serviced by mining infrastructure including numerous gold processing plants.
Acquiring Pinnacle Well is part of OZZ’s strategy to consolidate its position in the region.
Soil sampling at Mt Davis is due to begin this month, with drilling planned for the first half of next year.