- Granting of EL006816 application suffices the final condition for the acquisition of Victorian Goldfields Pty Ltd
- Initial fieldwork to commence next week, Haunted Stream hosts numerous underexplored prospects and historical mining centres with mined ore grade over 1 ounce per tonne
- Completion of 80% acquisition to trigger an allotment of 20 million fully paid ordinary shares to the VicGold vendors.
- Dr Gavin England to join the board as the Technical Director
Leading gold and base metals explorer, First Au Limited (ASX:FAU) announced today that Earth Resources Regulation Victoria has granted exploration licence EL006816, which centres the historic Haunted Stream gold workings. FAU shares were up 18.75% on the bourses post the news.
The granting of EL006816 successfully suffices the final condition for the acquisition of Victorian Goldfields Pty Ltd (“VicGold”). The initial fieldwork is expected to commence next week.
Victorian Goldfields Project Source: First Au ASX Update 25 September 2020
On 3 June 2020, First Au had announced entering into a binding term sheet agreement to acquire 80% of the issued share capital of VicGold, which held the tenements for Victorian Goldfields Project.
Once the acquisition of 80% stake is completed, First Au may acquire the remaining 20% stake of VicGold upon exercising an option on the decision to mine the project making the company the sole owner of the mining project.
Victorian Goldfields Project: A Premier Gold Project in the Lachlan Fold Belt
The Victorian Goldfields Project comprises of five Exploration Licence Applications namely, EL 006975, EL 006976, EL 006977, EL 005422 and EL 006816, in East Gippsland Victoria located in proximal distances to the towns of Bruthen, Swifts Creek and Dargo.
Interesting Read: First Au Commences Diamond Drilling at Gimlet
The Haunted Stream application area holds the potential for substantial high-grade gold mineralisation as indicated by the historical workings and the rock-chip sampling program over the 8 kilometres strike length. Mining history in the area dates to 1880s with ore mined at gold grade in excess of 1 ounce per tonne as per the records of the Victorian Government.
Outline of the VicGold tenement applications Source: First Au ASX Update 25 September 2020
The Haunted Stream area includes several historical workings restricted to no drilling to effectively test the extent of the mineralisation. Furthermore, untested saddle-reef style zones and several underexplored Victoria-style orogenic targets as well as Walhalla and Morning Star analogue exploration opportunities exist within the project area, further enhancing the prospectivity. The long history of alluvial mining further enhances the gold fertility of the tenement package.
The Victorian Goldfields exploration team identified the prospectivity of the region in 2018 following an academic study. It was presented by the Geological Survey of Victoria citing new geological evidence for the origination of the eastern arm of Ordovician Turbidites in East Gippsland Plotting, interpreted to be equivalent and an extension of the highly mineralised Bendigo-Fosterville terrane or the “Orocline model”.
Upon plotting the high-grade rock chip samples from the previous exploration activities on the new mapping and geological interpretation by VicGold suggests trends consistent with a series of structural controls on mineralisation which has previously not been interpreted or reported. First Au identifies the trend as the initial focus for the exploration activities at the Victorian Goldfields projects which holds several near drill-ready targets.
VicGold Acquisition & strengthening of First Au’s Board
First Au now satisfies all necessary conditions for the acquisition of 80% stake in VicGold and will now proceed towards completion of the acquisition. The completion of the acquisition agreement will initiate an allotment of 20 million fully paid ordinary shares at the deemed issue price of $0.01 per share to the VicGold vendors.
The terms of the acquisition include strengthening of the board with Dr Gavin England serving as Technical Director. Dr England currently serves as a geological consultant and the exploration manager for First Au. As a geologist, he has extensive exposure in the research, exploration, and project development of mineral projects. Dr England has been involved in the gold discovery at First Au’s Gimlet and is also a shareholder of VicGold.
Trading of First Au shares has been paused until 1 October 2020 or the release of an announcement, and the stock last traded at $0.019, up 18.75%, with a market capitalisation of $6.63 million.
All financial information pertains to Australian dollar unless stated otherwise.
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