Coffee with Samso Episode 79 with Mike Haynes, Managing Director and CEO of New World Resources Limited (ASX:NWC)
New World Resources Limited (ASX:NWC) is all about de-risking a high-grade copper mining project.
The Antler project is a VMS (Volcanogenic Massive Sulfide) that explains the nature of the deposit. What I like about VMS is that it is normally high-grade, occurs in clusters, has a longer LOM (Life of Mine) and the funding required is what a small-cap company can handle.
In Coffee with Samso Episode 79, we talk to Mike Haynes, the Managing Director and CEO of New World Resources Limited (ASX:NWC) about the Antler Project. Mike has been working in the US since 2005 and you can tell that he has an in-depth understanding of how the business works in that part of the world.
Over the years, I have been exposed to a few US projects and I have been very impressed with their technical merits. In nearly all these cases, the development potential has been good. The issue at that time was the availability of capital.
The tenure of these projects has been something I found significantly different to what is present here in Australian projects or in many other places. I think in terms of project development, this can make a lot of difference to the ultimate success of a project.
It is not often that one finds an intercept of 23m of ore with a grade of 6.7% Cu equivalent. It is even rarer to find that left in the ground waiting to be discovered.
Mike Haynes shares with us the story of how Antler was acquired and how this will add significant value to the company. The high-grade nature of the project will shield the project from future price volatility. These are all the facets of what I like about this project.
The fact is that ongoing drilling is finding better grades and bigger intersections as they go deeper. Hence, the path forward for the Antler project is all about a de-risking process towards mining.
PODCAST
About Mike Haynes
Managing Director and CEO
Mr Haynes has more than 25 years’ experience in the international resources industry. He graduated from the University of Western Australia with an honours degree in geology and geophysics and has explored a wide variety of ore deposit styles throughout Australia and extensively in Southeast and Central Asia, Africa, Europe, South and North America.
Mr Haynes has held technical positions with both BHP Minerals and Billiton plc. He has worked extensively on project generation and acquisition throughout his career. During the past 13 years he has been intimately involved in the incorporation and initial public offerings of numerous resources companies, and in the ongoing financing and management of those and other companies.
About New World Resources Limited
New World Resources Limited is an Australian company focused on the exploration and development of mineral resources projects in North America.
It is listed on the Australian Securities Exchange under the code NWC.
On 14 January 2020 New World Resources Limited announced that it had executed an agreement that provides it with the right to acquire a 100% interest in the high-grade Antler Copper Deposit in Arizona, USA.
Location and Infrastructure
The Antler Copper Project is located in a sparsely populated region of north-western Arizona (see Figure 1).
Access to the Project area is excellent; with direct access to the historical mine site by way of 20km of unsealed road that extends east from the town of Yucca (population approximately 6,000) which is on US interstate 40. A rail line passes through Yucca as well as Kingman (population 30,000), some 30km to the north.
The close proximity of good roads and utilities will be advantageous when exploring and developing the Project; affording opportunities to minimise operating costs and lower pre-production capital requirements.
The Antler Deposit lies within two (2) patented (private) mining claims that cover 40 acres. The Deposit is surrounded by an additional seven (7) unpatented (BLM) mining claims that cover a further 340 acres.
Figure 1. Location of Antler Copper Project in Arizona, USA.
Geology and Mineralisation
The Antler Deposit lies within a NE-trending belt of Precambrian gneissic and schistose rocks thought to have originally been volcanic in origin. The Deposit comprises a stratabound, pyrrhotite-rich, copper-zinc volcanogenic massive sulphide (“VMS”) body. Numerous other VMS deposits, in similarly-aged rocks, are present in northern Arizona. These include the United Verde Deposit – where 33Mt of ore was mined between 1883 and 1975 at a grade of 4.8% Cu, and the UVX Deposit – where 3.9Mt of ore was mined between 1915 and 1992 at a grade of 10.2% Cu (see Figure 1).
Mineralisation at the Antler Deposit outcrops over more than 750m of strike at surface. The host sequence strikes in a north-easterly direction and dips to the northwest. A complex array of tight folds has been mapped, and two north-westerly trending faults have been mapped to offset and truncate the Antler Deposit (see Figure 2).
Figure 2. Mapped geology at the Antler Copper Project in Arizona, USA, including all previous surface drilling.
Historical Production
The Antler Deposit was discovered in the late 1800s. Intermittent production from the Deposit between 1916 and 1970 totalled approximately 70,000 tonnes of ore at a grade of around 2.9% Cu, 6.9% Zn, 1.1% Pb, 31 g/t Ag and 0.3 g/t Au. Ore was extracted over approximately 200m of strike from an inclined shaft, to a depth of around 150m (see Figures 3-5). The average thickness of ore was reported to be around 4 metres. Additional underground workings were developed to a depth of 200m – but no production was recorded from the deeper levels.
Remnant Mineralisation
Previous mining operations deliberately targeted the highest-grade mineralisation; with stoping undertaken only where such mineralisation was thickest. Accordingly, considerable mineralisation remains, unmined, at very shallow levels immediately adjacent to historical stopes.
Between 1970 and 1975, following completion of the most recent episode of mining, a total of 19 holes were drilled from the surface and underground with the objectives being to:
increase confidence in the known mineralisation immediately below the mined levels (predominantly below the “7 Level” which was developed 150m below below surface) in advance of anticipated resumption of mining; and
explore for additional mineralisation.
Considerable high-grade mineralisation was delineated with closely spaced drilling over an area about 150m wide by 200m down-dip, immediately below the historical stopes (see Figures 3-5). Significant intersections (in unmined mineralisation) include:
9.66m @ 3.57% Cu, 6.63% Zn, 0.82% Pb, 34.4 g/t Ag and 0.34 g/t Au (U30);
7.62m @ 2.80% Cu, 7.29% Zn, 1.61% Pb, 43.4 g/t Ag and 0.54 g/t Au (DDH12);
5.18m @ 2.90% Cu, 12.58% Zn, 2.08% Pb, 63.1 g/t Ag and 0.42 g/t Au (U16);
7.62m @ 2.47% Cu, 3.52% Zn, 2.81% Pb, 64.5 g/t Ag and 0.46 g/t Au (B-3); and
6.40m @ 1.51% Cu, 10.69% Zn, 1.95% Pb, 52.1 g/t Ag and 0.29 g/t Au (U18).
Other, widely-spaced, drilling intersected additional high-grade mineralisation both (i) at depth, considerably below historical workings; and (ii) along strike from the historical workings (see Figures 3-5).
Figure 3. Long section through the Antler Deposit showing previous drilling and select significant intersections in surface drilling.
Figure 4. Detailed long section through the Antler Deposit showing previous drilling and select significant intersections in underground drilling immediately around the historical workings.
Figure 5. Cross-section through the Antler Deposit showing previous drilling and select significant intersections in drilling.
The deepest hole drilled at the Project to date (B-6) intersected high-grade mineralisation more than 400m down-dip of the lowest level of the historically mined workings (see Figures 3 and 5). Results included:
9.14m @ 1.53% Cu, 0.95% Zn, 1.10% Pb and 60.2 g/t Ag; and
1.22m @ 4.00% Cu, 7.10% Zn, 0.86% Pb and 35.9 g/t Ag
and other, very widely-spaced holes along strike from the historical workings intersected high-grade mineralisation (see Figure 3), with results including:
1.65m @ 4.20% Cu, 4.13% Zn, 1.25% Pb and 66.9 g/t Ag (B-4)
1.19m @ 3.99% Cu, 9.15% Zn, 0.77% Pb, 27.0 g/t Ag and 0.17 g/t Au (DDH4); and
2.13m @ 1.66% Cu, 3.57% Zn, 0.10% Pb and 1.22 g/t Ag (B-1)
The detailed drilling, immediately below the 7 Level, indicates there is substantial high-grade mineralisation that may be rapidly extracted if mining operations resume. And the results from the deeper and more widely-spaced drilling, where high-grades were returned in all but several holes, indicates there is considerable potential to delineate additional, mineable, high-grade mineralisation at the Project with further infill drilling.
Historical Resource
In 1975, a consultant to Standard Metals Corporation (the owner of the Project at the time), prepared a preliminary feasibility study into the development of the Antler Deposit. A mineral resource estimate was reported, which comprised:
Forward Work Plans
The Company commenced an initial 2,500m drilling program at the Antler Project in mid-March, 2020.
The Company’s immediate objective is to delineate robust JORC-Code compliant Indicated Resources that can be used in mining studies to evaluate the potential to bring the Antler Deposit back into production in the near-term. So the priorities for the Company’s maiden drilling program are to:
Undertake an appropriate amount of confirmatory drilling within a panel of “high-confidence, high-grade mineralisation” immediately below the previous stopes that have previously been drilled and sampled from underground (see Figures 3 and 4). Initial production (if mining operations resume) is expected to be derived from this area.
Undertake in-fill drilling between the more widely spaced and deeper historical holes that indicate there is a thicker, high-grade “plunging shoot” down-dip of the previous stopes (see Figure 3)
Undertake initial shallow drilling adjacent to historical stopes to test the thickness and grade of unmined mineralisation in these areas; and
To conduct initial step-out drilling outside the “plunging shoot” to test for thicker high-grade zones of mineralisation.
In parallel with initial drilling activities, representative drill core samples will be collected for metallurgical test work and geotechnical data will be acquired for initial mine design work. This information will facilitate commencement of studies into the resumption of mining and help optimise equipment sizing.
Given the very high-grades and shallow nature of the mineralisation, the Company intends to initially evaluate the potential to develop a low-CAPEX, high-grade mining operation at the Project, which could conceivably be brought into production quickly.
Disclaimer
The information or opinions provided herein do not constitute investment advice, an offer or solicitation to subscribe for, purchase or sell the investment product(s) mentioned herein. It does not take into consideration, nor have any regard to your specific investment objectives, financial situation, risk profile, tax position and particular, or unique needs and constraints. Read full Disclaimer.
VMS (Volcanogenic Massive Sulfide) Deposits Explained
In simple terms, Volcanic-associated Massive Sulphide (VMS) deposits are caused by underground metal-rich volcanoes rising and creating a cooking environment.
I suggest you download this eBook which explains the VMS and How to Add Value to your Share Portfolio
A lesson on geological models sought by mining companies that gives insight and an understanding of which portfolios are better - and potentially more lucrative – investments. Click here to download this eBook.
If you find this article informative and useful, please help me share the information. I try and write about topics that are interesting and have the potential to be of investment value. It is not easy to find stories that fit those parameters. If you or your organisation see the benefit of what Samso is trying to achieve and have a need to share your journey, please contact me on noel.ong@samso.com.au.
Powerful Advertising opportunities for Samso’s ASX and private business clients. The Brilliant-Online partnership is an opportunity to reach new and wider audiences in a fresh, appealing format to pique and retain investor interest. Contact Veronica directly for your special Samso-Brilliant advertising rate.
