The Wudinna Project
The project includes a cluster of deposits and earlier stage prospects including the Barns Deposit (“Barns”), the Baggy Green Deposit (“Baggy Green”) and the White Tank Deposit (“White Tank”). These deposits have Mineral Resources totalling 4.43 million tonnes at 1.5g/t gold for 211,000 ounces using a 0.5g/t gold cut-off grade, comprised of 0.41 million tonnes at 1.40g/t gold for 18,000 ounces of Indicated Resources and 4.02 million tonnes at 1.5g/t gold for 193,000 ounces of Inferred Resources.
Metallurgical testing has been conducted on composited samples representing both primary and oxide/supergene mineralised material from Barns and Baggy Green. At Barns, gravity and cyanide leaching of the gravity concentrate and tailings recovered 98.8% of the gold in a supergene sample, and an average of 97.5% of the gold in primary samples. At Baggy Green, recovery in a supergene sample was 94.3% while recoveries for primary samples averaged 98.7%.
Between 1996 and 1997, Newcrest Mining Ltd (“Newcrest”) completed reconnaissance-scale calcrete sampling survey on the tenement (then EL 2188) on which Barns is now located, with initial samples spaced at 1 km. A number of adjacent reconnaissance samples returned anomalous gold values over the Barns area. Infill sampling at 500 m centres completed by Newcrest in 1998 defined a large gold anomaly with a peak value of 31 ppb. The dimensions of the Newcrest anomaly, using a threshold of 2.5 ppb Au, approached 4.5 x 1.5 km.
In early 1999, Newcrest, which was enjoying considerable exploration success in the Cadia district in New South Wales, determined to dispose of EL 2188. Check sampling completed by Adelaide Resources (now Andromeda Metals) validated the existing anomalous gold-in-calcrete results and the company acquired a 100% interest in the property in late 1999.
In 2000, Andromeda (formerly Adelaide Resources Pty Ltd) completed further calcrete sampling over Barns at 400, 200 and 100 m centres. The resulting geochemical feature was a large coherent anomaly with a peak value of 49 ppb gold and included significant areas above 10 ppb. Calcrete samples were collected by hand auger and assayed at Amdel Laboratories using a low-level BLEG technique, giving a lower gold detection limit of 0.05 ppb.
The Barns, Baggy Green and White Tank gold deposits of the Wudinna Project were discovered by drill testing gold of calcrete geochemical anomalies.
The Barns gold deposit was discovered in 2000, with significant intersections including 12 metres at 3.38g/t gold from 67 metres in RCBN-123, and 35.49 metres at 1.80g/t gold from 115 metres in PDBN-134.
Intersections from White Tank, discovered in 2003, include 7 metres at 10.03g/t gold from 63 metres in RHBN-234, and 17 metres at 3.47g/t gold from 60 metres in RHBN-248.
Baggy Green was found in 2004 with notable intersections including 8 metres at 4.79g/t gold from 34 metres in WUD6-770, and 5 metres at 9.01g/t gold from 66 metres in BGRC-865.
The Gawler Craton preserves a complex and prolonged tectonic history spanning the interval c. 3200 – 1500 Ma. This includes episodes of felsic magmatism, followed by sedimentation and bimodal (felsic and mafic) volcanism, and then by felsic volcanism (Dept Mines, 2019).
As shown in the figure below, the Central Gawler craton gold province forms an arcuate belt wrapping around the southwestern margin of the Gawler Range Volcanics and in part following the boundary between the Mesoproterozoic (c.1595 – 1570 Ma) and Paleoproterozoic (c. 163 – 1608) rocks (Fraser et al, 2007, Reid & Hand, 2012)).
The Gawler Range Volcanics (GRV) are described by Parker and Flint (2005) being composed of pinkish medium-grained granite with xenoliths of gneiss and foliated grey granodiorite; foliated biotite granite and massive cream-coloured, weakly foliated leucogranite. The GRV were emplaced between 1595 and 1575 Ma and are coeval with the Hiltaba Suite. The GRV are flat lying and relatively undeformed.
Central Gawler Gold province comprises gold deposits such as Tunkillia, Tarcoola,
Weednanna and Nuckulla Hill. Fraser et al (2007) characterised the Tunkillia, Nuckulla Hill, Barns, and Weednanna gold deposits with the following:
- The hydrothermal alteration is characteristically zoned around gold mineralisation, with intense sericite pyrite alteration and quartz veining proximal to gold mineralisation and chlorite ± epidote ± hematite alteration distal from mineralisation,
- Alteration was either synchronous with or, in some cases, continued after deformation,
- Gold is associated with pyrite and minor to trace galena, sphalerite, and chalcopyrite,
- Iron oxides are low in abundance in mineralized zones, which correspond to demagnetized zones,
- The prospects/deposits are similar to those of orogenic- and intrusion-related gold deposits
The variation and common characteristics between intrusion related and orogenic gold deposits has been discussed by several authors such as Duuring et al, 2007, and Sillitoe and Thompson 1998. The figure below shows a schematic of the interrelationships of granitoid, intrusion related and orogenic gold deposits of the Yilgarn Craton in Western Australia.
Fraser et al. (2007) demonstrated that the gold systems of the Central Gawler province share similar timing and involved fluids with like properties with the Olympic Dam IOCG province, in support of the existence of a gold metallogenic province. Fraser et al (2007) and Skirrow e al (2007) demonstrate that both the IOCG and gold hydrothermal systems were broadly coeval with magmatism of the Hiltaba Suite and Gawler Range Volcanics, at ~1570 to 1595 Ma.
Within the Wudinna project area, the geology is described by Drown (2003) as an area covered by Quaternary sediment, which limits surface exposures, and deep weathering profile to greater than 50 m depth (Drown, 2003). The area is dominated by the Archaean Sleaford Complex (in the east) and the Tunkillia Suite (in the west). The Sleaford Complex is described by Parker and Flint (2005) as foliated migmatitic quartz–feldspar–biotite (garnet) gneiss and augen gneiss with possible local BIF, namely the Hutchinson Group within the Project area. The Tunkilla Group rocks are moderately deformed granodioritic gneiss (Drown, 2003). The regolith profiles are described by Mayo & Hill (2016) and Parker et al. (1985) as siliceous and variably calcareous sandy sediments forming old dune ridges.
The Wudinna gold project includes the Barns, White Tank, and Baggy Green prospects. Gold mineralisation is hosted within granodiorites of the Tunkillia Suite that is variably deformed and altered. This has been attributed to the intrusion of the Hiltaba Suite Granites (e.g. see Drown, 2003; Fraser et al, 2007).
The host lithologies for the Barns, White Tank and Baggy Green is granodiorite made up of plagioclase, K-feldspar, quartz and biotite with minor apatite, allanite, magnetite and zircon all within a weak, subvertical foliation. Also present is quartzite and gneiss occurring as blocks within the granodiorite and minor pegmatites and mafic dykes (e.g. Figure 3 6; Drown, 2003 and Fraser et al, 2007).
Identified at the Barns gold prospect is a zoned alteration system with an outer chlorite-epidote-sericite-rutile-hematite and inner zone of sericite-pyrite-gold. The outer zone of alteration is identified with chlorite replacing biotite, plagioclase altered to albite and K-feldspar containing abundant microcrystalline hematite inclusions. The inner alteration zone is of pervasive sericite replacing plagioclase with disseminated pyrite and the k-feldspar generally intact (Drown, 2003; Fraser et al, 2007).
Gold mineralisation at the three deposits is located in shallowly west or northwest dipping shear or fault zones. The mineralisation is weakly sulphidic with pyrite dominant at Barns and White Tank, and chalcopyrite at Baggy Green. Gold mineralisation is hosted in 1 to 10mm-wide quartz pyrite veins within the inner alteration zone, with gold occurring as free particles generally less than ~100μm in diameter. The mineralised veins strike north-south or northeast- southwest and dip moderately to the west or northwest (e.g. Drown, 2003).
A review of the structural geology at the Barns deposit by King (2001) showed that the gold mineralisation may be controlled by NW trending structures and the proximal association of the Hiltaba Suite intrusives, granite and granodiorite. Reverse shearing was noted in drill core with west dipping structures displaying gentle to moderate dips of shears and veins.
A study of the aeromagnetic imagery identified a magnetic low coincident with the Barns mineralisation and is interpreted to be magnetite destruction associated with the propylitc alteration. Lady Alice Mines (2019) undertook a structural review of the Wudinna project in 2018 with the following conclusions:
- The veins at the Barns deposit dip shallowly to the west and their strike is coincident with the main trends in the bedrock geochemistry.
- The Barns mineralisation is west-dipping auriferous zones are either truncated by faulting or simply die out down-dip to the southeast.
- Mineralisation weakens to the north and is constrained in depth probably above a curved flat-lying shear-zone.
- At Baggy Green the veins dip north at about 30 degrees, in contrast to the geochemistry that strikes to the north, the trend of the calcrete anomalies represent north-northeasterly trending shear-zones, within which auriferous structures dip as arrays or single units to the north.
The geological interpretation (shown below) by Drown (2003) indicated a flat dip of mineralised zones generally following lithological contacts with the interpretation validated by the Lady Alice Mines (2019) investigations.
The gold mineralisation within basement rocks has been shown to correlate well with gold-in-calcrete anomalism from surface sampling. An extensive study of the regolith profiles and extents was carried out by CSIRO CRC LEME (Sheard, 2007). This study showed that shallow transported cover (<5-10m) over basement rocks may be related to lithogeochemical anomalism of Au, Cu, Ag, or As. The regolith profile and landform relationships developed as part of the study by CSIRO identified several regolith profiles in the study area. The regolith and landscape evolution study assist in the understanding of landscape position and local landforms are both crucial when selecting appropriate geochemical sample media and for interpreting their trace element assay values.
The total Wudinna Project Mineral Resource, including the Baggy Green, White Tank and Barns gold deposits, totals 4.43 million tonnes at 1.5g/t gold for 211,000 ounces using a 0.5g/t gold cut-off grade, comprised of 0.41 million tonnes at 1.40g/t gold for 18,000 ounces of Indicated Resource and 4.02 million tonnes at 1.5g/t gold for 193,000 ounces of Inferred Resources. This includes:
- The Barns Mineral Resource Estimate totals 2.21 million tonnes at 1.5g/t gold for 104,000 ounces at a 0.5g/t gold cut-off grade. The Resource includes 0.41 million tonnes at 1.4 g/t for 18,000 ounces classified as Indicated and 1.71 million tonnes at 1.5g/t classified as Inferred.
- The Baggy Green Mineral Resource Estimate totals 2.03 million tonnes at 1.4g/t gold for 94,400 ounces at a 0.5g/t gold cut-off grade. The Resource is classified as Inferred.
- The White Tank Mineral Resource Estimate totals 0.28 million tonnes at 1.4g/t gold for 13,000 ounces at a 0.5g/t gold cut-off grade. The Resource is classified as Inferred.
Barns, Baggy Green and White Tank fall within 6km of each other and are shallow and potentially open-pitable. Each of the deposits remain open and step-out drilling can potentially add further resources, while other prospects in the Wudinna Project also show potential to contribute ounces. Recent metallurgical testwork confirms gold recoveries exceeding 97% are achievable at Barns using a conventional flowsheet, with testing of Baggy Green mineralisation is foreseen.
Optiro Pty Ltd (“Optiro”) has prepared updated Mineral Resource estimates for the Barns, White Tank and Baggy Green deposits. Mineral Resources were estimated by Mining Plus Pty Ltd (“Mining Plus”), for Andromeda (the owner of the project), in 2016 for the Barns deposit and in 2017 for the White Tank and Baggy Green deposits.
In 2018, LAM, a joint venture party, requested Optiro to investigate an alternative orientation to the interpreted mineralisation at Barns, White Tank and Baggy Green aligned with the strong regional northwest/southeast orientation observed in:
- calcrete gold geochemical data;
- regional gravity and magnetic data; and
- structural interpretation of drill core data.
Variography indicated that the maximum continuity for the mineralisation at Barns is orientated along 305°, which is consistent with the regional orientation observed by LAM. LAM requested Optiro to re-model the mineralisation at Barns, White Tank and Baggy Green using this as the dominant orientation for the mineralisation and to develop alternative conceptual resource models.
A nominal cut-off grade of 0.3 g/t gold was used for interpretation of the mineralisation at Barns, White Tank and Baggy Green. Optiro provided preliminary resource estimates for Barns, Baggy Green and White Tank which were based on the interpretation of a series of stacked lodes with an overall strike consistent with the regional northwest orientation and a shallow dip to the southwest. Since then, Optiro obtained the weathering surfaces and density data used by Mining Plus and has updated the preliminary resource models with these data. In addition, two horizons of supergene mineralisation have been interpreted within the saprolite material at Barns that replaced three of the previously interpreted dipping lodes.
Interpreted mineralisation at Barns extends over and area of 400 mN by 250 mE and is up to 200 m deep. Two lodes of flat-lying supergene mineralisation and 12 lodes of shallow dipping, fresh mineralisation have been interpreted. At White Tank, the interpreted mineralisation extends for 250 mN by 150 mE and is up to 120 m deep. One lode of flat-lying mineralisation and two shallow dipping lodes of mineralisation within fresh material have been interpreted. The Baggy Green resource has two areas of mineralisation: within the south the interpreted mineralisation extends over an area of 200 mN by 400 mE and in the north it extends over an area of 150 mN by 300 mE. One lode of flat-lying supergene mineralisation and 13 shallow dipping lodes of mineralisation have been interpreted within the fresh material to a depth of 200 m.
The resource models for the Barns and White Tank deposits were constructed using a parent block size of 10 mE by 10 mN on 4 m benches; the parent blocks were allowed to sub-cell down to 2 mE by 2 mN by 0.5 mRL to more accurately represent the geometry and volumes of the weathering horizons and mineralisation domains. For Baggy Green a parent block size of 20 mE by 20 mN by 5 m was used and the parent blocks were allowed to sub-cell down to 4 mE by 4 mE by 1 m RL. Gold block grades were estimated using ordinary kriging techniques, with search ellipses oriented within the plane of the mineralisation. Hard boundary conditions were applied for grade estimation into each of the mineralised domains (i.e. grade estimation for each domain used only the data that is contained within that domain).
A total of 255 bulk density determinations have been undertaken at Barns on either historical or recent diamond drillholes and 185 bulk density determinations have been undertaken at Baggy Green on recent diamond drillholes. Average values were calculated from the complete dataset by Mining Plus using a combination of weathering and mineralisation. Density values assigned to the mineralised domains in the resource models range from 2.29 t/m3 to 2.73 t/m3.
The mineralisation at Barns, White Tank and Baggy Green has been classified as Indicated and Inferred in accordance with the JORC Code. The Mineral Resources have been classified on the basis of confidence in geological and grade continuity and taking into account data quality (including sampling methods), data density and confidence in the block grade estimation, using the modelled grade continuity and conditional bias measures (slope of the regression) as criteria.
Indicated Mineral Resources have been defined at Barns within the supergene mineralisation in areas where drill spacing is generally 20 mE by 50 m or less. An Indicated classification was applied to four of the fresh lodes where the drill spacing is generally 20 mE by 50 m or less and the resources are above 40 mRL. Inferred Mineral Resources have been defined in areas where an extension of mineralisation is supported by the drilling. The total Mineral Resources at White Tank and Baggy Green have been classified as Inferred.
The likelihood of eventual economic extraction was considered in terms of possible open pit mining and results from metallurgical testwork. Metallurgical testwork from material at Barns and Baggy Green indicated gold recoveries ranging from 94.3% to 99.3% and averaging 97.7% across all samples from a combination of conventional gravity and cyanide leaching.
The Mineral Resource estimate, as at March 2019, for the Barns, White Tank and Baggy Green deposits is reported in the table below. This has been classified and reported in accordance with the guidelines of the JORC Code. The Mineral Resources have been reported above a 0.5 g/t gold cut-off grade to reflect current commodity prices and extraction by open pit mining.
Grade (g/t Au)
Note: inconsistencies in totals due to rounding
For the Wudinna Gold Project, comparison of the 2017 and 2019 resource estimates indicates the tonnage has increased by 15% and the grade decreased by 8% for an overall increase in the contained gold by 5%.
For Barns the global estimates are similar, with the 2019 estimate reporting a slightly higher tonnage and lower grade, for a decrease of 4% in gold ounces. Within the 2019 model a slightly higher proportion of the resource has been classified as Indicated. While the alternative orientation has not significantly changed the global resource estimate at Barns, it does present alternative strategies for future exploration and potential resource extension.
At both White Tank and Baggy Green, the 2017 resource estimates plot on the grade-tonnage curves as estimated in 2019, but at higher cut-off grades of almost 1 g/t gold. This is in-line with the lower cut-off grade that was used for the mineralisation interpretations in 2019. For both deposits this has resulted in additional tonnage at a lower grade, with an overall increase in contained gold ounces.
Gold mineralisation was originally detected from geochemical sampling which targeted calcrete layers in shallow transported cover. Further work by LAM in 2018 established that a zone of calcrete depletion aligned with the regional zone of deformation, in a north westerly orientation. LAM surmised that the raw gold in soil/calcrete values identify the valley-fill alluvial gold dispersion, whereas calcium-normalised gold in soil/calcrete values better reflect the presence of underlying gold mineralisation.
Further analysis demonstrated that testing of raw gold in soil/calcrete anomalies was suboptimal and that calcium normalised gold, which accounts for the degree of concentration in calcrete better reflects the presence of underlying gold mineralisation.
Secondly, the presence of anomalous arsenic geochemistry in in soil/calcrete samples is a common path finder used in hydrothermal gold exploration. The existing mineralisation showed a strong correlation with arsenic anomalism, and when coincident with calcium-adjusted-gold, proved to a better indicator of the existing mineralisation at Barns and Baggy Green. The presence of silver, which does not concentrate in calcrete to the same degree, was a tertiary indicator.
By applying this new understanding of the geochemical relationships to the larger tenement holding, 14 target areas were identified. Each of these areas has anomalous and coincident calcium adjusted gold and arsenic anomalism in soli/calcrete samples.
Infill geochem sampling at the 6 priority targets (ANC#1, ANC#3, ANC#6 ANC#7 ANC#8 and BU1 shown in the figure below) are planned to be completed as a priority by the Company in order to target a reverse circulation drilling programme which will test for bedrock gold mineralisation. The aim of this drilling programme is to replicate similar mineralisation as that discovered at Barns, Baggy Green and White Tank.
The Wudinna Agreement
On 31 October 2017, Andromeda announced that it had entered into a binding agreement with LAM, pursuant to which LAM can earn an up-to 75% interest in the Wudinna Gold Project (the “Wudinna Agreement“).
Under the terms of the Wudinna Agreement, LAM will fund up to A$5,000,000 through a staged earn-in over a (maximum) six year period in order to earn up to 75% equity in a joint venture vehicle over the Wudinna Project (the “Wudinna JV Co”) as follows:
- Stage One: LAM will sole fund A$2,100,000 within three years of the execution date of the Wudinna Agreement.
- Stage Two: At the completion of Stage One, either (i) the Wudinna JV Co can be formed, in which LAM will be entitled to hold 50% of the share capital; or (ii) LAM can spend a further A$1,650,000 within two years after the completion of Stage One to earn a 65% equity interest in the Wudinna Project.
- Stage Three: At the completion of Stage Two, either (i) the Wudinna JV Co can be formed, in which LAM will be entitled to hold 65% of the share capital; or (ii) LAM can spend a further A$1,250,000 within one year of the completion of Stage Two to earn 75% of the equity in the Wudinna Project. The Wudinna JV Co would be formed, in which LAM would hold 75% of the share capital.
Once the Wudinna JV Co is formed, LAM and Andromeda will contribute to further expenditure in accordance with their respective equity positions. LAM will act as operator of the Wudinna Project.