- Shree Minerals is continuing to identify and assess exploration and early development opportunities throughout Australia. In COVID-19 affected financial markets, divestment opportunities from cash starved companies are likely to increase.
- The recent Arunta JV, which Executive Director, Sanjay Loyalka deems to be another exciting exploration opportunity besides ongoing development at Nelson Bay River Iron Project and Golden Chimney Project.
Explorer and miner Shree Minerals Limited (ASX:SHH) has been garnering market attention for being engaged in mining and production of iron ore and dense media magnetite at its Nelson Bay River Iron Project in north-western Tasmania as well as gold exploration at its Golden Chimney Project in Western Australia.
Ending the month on a positive note, Shree Minerals reported its quarterly activities for the period ending 31 March 2020 and also unveiled the Arunta Joint Venture. The updates set the stock soaring on the ASX, with SHH ending 30 June 2020 up by 25 % at $ 0.005.
Let us deep dive-
March Quarter Report
In the quarterly period ending 31 March 2020, Shree Minerals continued to progress works at both its Projects and has a robust outlook along with healthy business development plans. On the corporate end, the Company ended the quarter with cash and cash equivalents worth $ 983 k.
Nelson Bay River Iron Project
During the quarter, Shree Minerals progressed re-permitting of the DSO project as its Project Development process wherein revised working Draft DPEMP has been submitted to EPA post completion of updated technical modelling and finalisation of several management strategies. The Company is targeting to finalise the draft shortly with a view to progress for the next stage of the approval process.
Moreover, mine is in a ready state to recommence production at short notice with existing development in place.
Golden Chimney Project
Significant development occurred at the Project during the quarter with the Company acquiring additional area in it. Moreover, The WA Department of Mines, Industry Regulation and Safety affirmed the grant of the amalgamation application of Prospecting Licence P40/1354 with E40/378. It should be noted that P40/1354 surrounds excluded mining lease M40/09 (Lone Hand) which encompasses old gold workings.
Updating about progress at Golden Chimney West, Shree Minerals notified that during the quarter, desktop studies were conducted over the Project to interpret geology & identify further work areas. A thin (0.3m) veneer of transported colluvium and alluvium over the area indicates that geological mapping and collection of rock chips is perfectly suited to defining new drill targets.
Farm-in and Joint Venture with Territory Lithium Pty Limited
Reported on 30 June 2020, the Company entered into a farm-in and joint venture agreement with Territory Lithium Pty Limited with the intent to explore Territory Lithium’s tenements for gold and base-metals. Projects include Edwards Creek, Box Hole and Bruce Gold Projects in the Northern Territory.
SHH can earn a 50% equity interest in the JV via the total expenditure of $50 k. Once earned, further JV expenditure contributions will be pro-rata/ non-contributing party’s equity will be diluted using the standard industry dilution formula. In the event of a sole expenditure, SHH’s share of equity in the JV would increase to 90% (total expenditure of $450 k).
Moreover, if a party’s equity falls to 10%, its share will be automatically acquired by the other party in exchange for a 1% NSR Royalty. SHH will manage the JV during the earn-in stage, and while ever it holds majority equity.
Edwards Creek Project (spread across 76 km sq)- EL32420
Previous exploration discovered copper-(gold) mineralisation that has been interpreted to be metamorphosed volcanic massive sulphide. Previous drilling intersected 4.5m @ 2.5% Cu, 0.67% Pb from 17m.
The project has been held by a variety of companies since the initial drilling, including Pasminco and more recently Territory Exploration. Reportedly, the potential for mineralisation is interpreted to exist around the folded prospective stratigraphic horizon. The target horizon contains numerous occurrences of copper, lead, zinc, and magnetite along its length.
Box Hole Project (spread across 127 km sq)- EL32419
The project is prospective for large tonnage carbonate-hosted lead-zinc deposits of the Mississippi Valley Type. It is centred on the King’s Workings that were mined by hand in the 1960’s for galena - 15 tonnes of galena with an average grade of 66% Pb, 58.5g/t Ag and 0.43% Bi was handpicked and sold to the Broken Hill Smelter. The project has been explored by a variety of companies since its discovery, most significant one completed by Uramet Minerals in 2007-9 comprising various IP and gravity surveys, geochemical surveys, and shallow drilling. RAB drilling of only selected gravity and IP targets interpreted to be less than 75m deep.
IP anomalies may represent mineralisation leakage from a more substantial mineralising system or significant mineralisation proximal to an unknown growth fault.
Bruce Gold Project (spread across 127 km sq)
Rock chip sampling of gossanous quartz veins at the project by the Northern Territory Geological Survey returned grades of up to 53g/t Au and anomalous assays were produced in 1996 by Roebuck Resources. Soil sampling by Olympia identified a low-level gold anomaly that indicated soil sampling was only partially effective at delineating the mapped mineralised veins. The veins are hosted by a mixed rock sequence including mica schist, calc-silicate and amphibolite that form part of the Irindinia Gniess.
Regional aerial imagery interpretation by Shree has identified several other quartz veins throughout the project area
What’s in Store?
An amalgamation of P40/1354 with E40/378 allows the Company to assess the exploration potential of the area and identify prospective structures that may strike onto its surrounding E40/378 from M40/09. Identification techniques may consist of geochemical soil and rock chip sampling and geological mapping.
Therefore, to define new drill targets at the Golden Chimney Project, geological mapping and rock chip sampling is recommended (at Golden Chimney West). In this portion, anomalous soil geochemistry has not been tested by drilling.
At the Nelson Bay River Iron Project- the SDSO pit (south DSO pit) is proposed to be deepened to mine remains of the near-surface oxidised ore body, consisting of DSO hematite, to a depth of ~ 80 m.
At Edwards Creek Project- The project requires further assessment of the EM surveys using modern filtering and modelling techniques to design definitive drill programs. Additional holes drilled to test the strong EM conductor will be surveyed with downhole electromagnetics to assist modelling and targeting. The Company will also review previous exploration data to assist targeting of the mineralised horizon along strike where drilling has not been conducted previously. Moreover, reconnaissance work and sampling are required around mapped syncline and regional reconnaissance.
At Box Hole Project - Processing and modelling of the gravity and IP data, using modern filtering and processing techniques will refine target areas. IP and geochemical anomalies are highly recommended post target generation, close spaced soil sampling, followed by drilling of the high priority coincident gravity. The Company intends to update the review of the project and to assist with the generation of targets for follow up work and drill testing.
At Bruce Gold Project- Field reconnaissance is required to determine if veins have the same gossanous characteristics as identified by the Company. Ultra-fine soil sampling may identify a much longer and substantial mineralised halo. Auger or RAB drilling to collect meaningful geochemical samples is well suited to the desert sands
Casting Eye Over Shree Mineral’s Projects
Nelson Bay River Iron Project
Owing to sharp iron ore price falls, the Project, which was previously producing direct shipping Iron Ore (Fines & Lump) products, was placed on care and maintenance since June 2014.
However, there has been recent improvement in iron ore prices which remain robust in the current environment. Consequently, the Company is proposing to re-open the mine and is seeking an environmental permit from Tasmanian EPA. This will-
- Enable Shree Minerals to complete existing DSO pit by extracting, processing (crushing and screening) and shipping remaining hematite ore
- Revised Project will utilise associated infrastructure including existing WRDs, RoM pad, roads, water, and other infrastructure located within the current mine footprint
Note: The Project product (DSO Lump and Fines) has been very well received and is in demand by customers owing to its low impurities like alumina (Al2O3) at only 1.3%.
Golden Chimney Project
Located 40km south of Leonora, renowned Sons of Gwalia Gold mine occurs within this geological terrain. Other significant and economic deposits include King of the Hills Mine, Tower Hill and Kallis– Trump and Ulysses.
The Company had decided to apply for amalgamation of P40/1354 post its surrender in 2019. Production records suggest 358 kg of ore at a grade of 2.08 g/t Au was treated from the gold workings in 1983-1984 (treated from the Lone Hand and the Blue-Ribbon gold workings).
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