Fresh from its ASX debut, OZZ Resources (ASX: OZZ) is wasting no time in evaluating its Western Australian gold and base metal projects with the first batch of assays from a maiden drill program anticipated this month.
The explorer only hit the bourse a month ago after raising $5 million through a “heavily oversubscribed” initial public offering (IPO), issuing 25 million shares at $0.20 each.
Its five projects are located near major gold production centres and along strike on major regional mineralising structures in the Central Murchison, Leonora and Midwest regions of WA.
According to its prospectus, OZZ planned to use the majority of its IPO funds to explore the projects to identify economic mineral deposits for development.
With targets already lined up for drilling, the company aimed for a rapid execution of its resource definition strategy and within a fortnight of listing, the first hole was underway at Old Prospect in the Maguires project.
In the last month, it has also completed aeromagnetic surveys over its Rabbit Bore (gold and base metals) and Peterwangy (gold) projects.
OZZ was incorporated a year ago to acquire interests in five WA-based gold projects.
It has signed a tenement purchase agreement to acquire 100% in the Maguires project and 80% stakes in the Rabbit Bore and Wardarbie South projects under purchase and joint venture agreements. All three projects are located in the Central Murchsion area, north of the major mining centre of Cue.
Under separate farm-in deals, the company can also earn up to 80% in Mt Davis, 20km north of Leonora, and 76% in Peterwangy, 100km east of Geraldton port, by funding two years of exploration expenditure and completing feasibility studies.
Based on historical exploration and available data, OZZ considers all five projects prospective for gold mineralisation. In addition, the Rabbit Bore project is believed to potentially host nickel, copper, cobalt and platinum group metals.
In its prospectus, OZZ outlined its proposed use of the IPO funds for the two years following listing. About half of the proceeds have been allocated to exploration costs with the majority focused on the Maguires and Mt Davis projects.
The remaining funds were assigned to exploration administration and project acquisition costs, working capital and admin, and costs of the offer.
Maiden drilling underway at Maguires
Upon listing, OZZ hit the ground running with a 5,000m reverse circulation drilling program starting at the Maguires project in mid-July.
The bulk of historical drilling undertaken in the area focused on the Old Prospect with this new campaign designed to validate previous results including 6m at 18.6 grams per tonne, 7m at 8.7g/t and 6m at 11.6g/t gold. The drilling will also test for extensions along strike and down-dip.
The objective of this maiden campaign is to deliver an initial JORC 2012 compliant mineral resource estimate for Old Prospect. Additional follow-up drilling is planned to test the Maguires Reward prospect, located 1km to the east of Old Prospect on a parallel structure.
Drilling commenced in mid-July and is scheduled to take four to five weeks to complete with assay results expected around four to six weeks from submission. This means the first batch of results should be returned this month.
Meanwhile, OZZ completed aeromagnetic (drone) surveys over the Rabbit Bore and Peterwangy projects with results and interpretation expected in August.
Rabbit Bore hosts a 5km strike length of prospective shear zones largely under cover between Cue and Meekatharra, including several historic gold workings which have returned assays of up to 4.2g/t gold.
Peterwangy hosts historic workings within a 3km long greenstone belt straddling the craton-scale Koolanooka Fault. The project area has never been drilled.
OZZ said the data generated by the surveys will allow it to undertake the most detailed analysis to date of the magnetic characteristics of the two projects and will be used as the basis for further exploration including geochemical sampling to define future drilling targets.
In addition, an aeromagnetic survey is planned to evaluate 3km of prospective lithologies within the Wardarbie South project with the data to be sed in conjunction with soil sampling to define favourable structural settings for drill targeting.
Although Mt Davis is the most advanced of OZZ’s projects, it will not become a focus until later in the year once heritage and access approvals are finalised. This project is located 4km south of the 4.1-millionounce King of the Hills gold project, which is currently being developed by Red 5 Limited (ASX: RED) as a major new standalone open pit and underground gold mine.
Mt Davis also contains mineralisation at the Trig deposit, which is hosted by the same geological structures associated with the world-class 8Moz+ Sons of Gwalia mine.
Highly respected and experienced team
OZZ has a highly experienced corporate and technical team led by chairman Alan Lockett and managing director Jonathan Lea.
Mr Lockett was the founder and managing director of Olympia Resources, which discovered the now-mined Harts Range garnet deposit in the Northern Territory. He was also previously executive chairman of Northern Mining, which discovered both the George’s Reward gold deposit near Kalgoorlie and the Keysbrook mineral sands deposit south of Perth.
Mr Lea brings more than 35 years of mining industry experience including former roles as the managing director of Polaris Metals, which developed the Carina iron ore deposit near Southern Cross, and technical services manager for the AurionGold group in Kalgoorlie.
Experienced metallurgist and process engineer Brian McNab also sits on the board as a non-executive director.