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Theta Gold (ASX:TGM) in the box seat to advance its South African Project

Source: TTstudio, Shutterstock

Summary

  • Investors are shifting their funds to the gold market from the equity market via ETFs, gold coins, bars and gold-related stocks.
  • Theta Gold, which is operating in the promising Gold market, has planned to produce more than 160,000 oz of gold yearly from its underground mines.
  • The Company has recently raised sufficient funding during September quarter to facilitate potential investment and fund further project development.

Since the onset of the pandemic, gold witnessed a spurt in its demand as the investors rushed to inject their moolah in the yellow metal - the so-called ‘safe-haven’ for investment. The investment rose by 21% Y-O-Y in various gold instruments like-bars, coins and ETFs. According to the World Gold Council, 222.1 tonnes of gold bars and coins were bought in the September quarter while 272.5 tonnes were bought through gold ETFs.

The gold prices hit US$2067/oz, an all-time high of in August. Investors were seen mobilising their funds from the equity market to gold market via ETFs, gold coins, bars and gold-related stocks. The spot price of gold on 6 December 2020 was recorded at US$1837.9/oz after the news of vaccines instilled faith in the stock market.

In this backdrop, let us discuss the latest exploration endeavours undertaken by Theta Gold Mines Limited.

Theta Gold Ready to Shine in Gold Market

ASX-listed gold development company, Theta Gold Mines Limited (ASX:TGM, OTCQB:TGMGF), holds the Eastern Transvaal Gold Fields in South Africa. The vast area under the field is very little explored and lies near the historic gold mining town of Pilgrims’s Rest.

Project Location Map (Source: Company Website)

The field has a vast resource of 5.8 Moz including 1.3 oz in the open cut while 4.5 Moz in the underground resource.

Mineral Resource Classification (Date Source: Company Website, Data figures in Million Tonnes)

More Details here: Theta Gold Mines eyes huge gold production from its South African mines

Encouraging Bulk Metallurgical Sampling Program Result

The Company shared the result of underground bulk metallurgical result based on the nine 50kg sample size. The samples revealed exceptional gold recovery using Carbon in Leach (CIL) process. Theta Gold will use the test result to assess the ways to produce up to 160,000oz Au per year from the project.

Results from three prominent mines from the project- Rietfontein, Beta and Vaalhoek are as below:

Metallurgical Sampling Results   (Data Source: Company Update 18 November 2020)

Q4 2020 will witness TGM to start a Pre-Feasibility Study (PFS) on Rietfontein and Beta Mines among several underground mines. The company is expected to start the preliminary underground sampling work. Other works include Engineering Design solution for the construction of the CIL plant along with funding solution and refurbishment of Ball Mill which is set to commence in Q4.

The company expects to receive approval of Environmental Authorisation from the Department of Mineral Resources and Energy, for its initial open-pit Theta Project.

Cash Position & Funding

Theta Gold reported a cash reserve of US$973,000 at the end of the September quarter. The Company raised US$2,872,000 through Placements by issuing 16,667,084 fully paid ordinary shares @ A$0.24 per share during the September quarter.

TGM further raised US$80,000 through 595,788 options @A$0.19 per share during the same quarter. The Company is looking for potential investment and funds for further project development.

Stock Performance

The shares of TGM closed at A$0.300 on 7 December 2020, with a market cap of A$133.44 million. 

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