- Kaiser Reef commenced a reverse circulation (RC) and diamond drilling (DD) program at the Stuart Town gold project.
- RC drill results awaited in the short term, diamond drilling activity to continue. Drilling program targeting historic gold mining centres.
- Fundraising program to finance exploration activities at Maldon and A1 mine and sufficient working capital. Cash reserves of $3.787 million as on 30 September 2020.
ASX listed gold explorer, Kaiser Reef Limited (ASX: KAU) released the activities report for the September quarter. During the September quarter, the gold explorer focussed on the Stuart Town Goldfield, situated between the recent significant gold discovery at Alkane Resources Ltd’s (ASX:ALK) Boda deposit and the largest gold mine in Australia, Newcrest Mining Limited’s (ASX:NCM) Cadia-Ridgeway gold operations.
Maiden Drilling Campaign at Stuart Town gold project
Shortly after the permitting were received in August, Kaiser commenced the maiden reverse circulation (RC) and diamond drilling (DD) program at the flagship Stuart Town gold project. Utilising the high-resolution geophysical surveys, the drilling program focussed on the massive historical gold workings in the region. Kaiser has appointed a team of locally experienced geologists to identify broad zones of intrusive rocks subjected to extensive alteration in the drilling.
Drill Plan in the Stuart Town goldfield Source: Kaiser Reef ASX Update 23 October 2020
The initial drilling campaign tested multiple priority targets, including the Rockdale and the Specimen Hill mine. The drilling program initiated with RC drilling followed by diamond drilling the Quartz Hill region and is currently underway. The program will expanse over 1,500 and 3,000 metres with the assistance of geological mapping, geophysical investigation and assessment of historic gold prospects within the prolific mining centres in the Stuart Town goldfield.
The RC drilling results are awaited and will be reported in the near future. The diamond drilling activity on the project site would continue, and the results of the same would release in due course over a longer term.
The Stuart Town gold project has been subjected to minimal modern exploration with the major gold mining operations dating back to the 1850’s and is a critical gold exploration ground in the Lachlan fold belt. Due to the underexplored nature, the geological model and source of the gold mineralisation are required to be assessed in the future.
Acquisition of Victorian Gold projects
Subsequent to the September quarter, Kaiser on 1 October announced entering into an agreement with Golden River Resources Pty Ltd (GRR) to acquire material assets in the Victorian Goldfields.
Immediate gold producer in a strong gold price environment: The acquisition will grant Kaiser access to the highly sought after Victorian high-grade gold district with a full fledged independent operating mining and processing operations. The goldfield has a long heritage of substantial gold production but is highly underexplored using modern exploration techniques.
Also Read: Kaiser Reef’s strong portfolio in LFB
The Victorian goldfields are home to major high-grade and profitable mining operations such as Fosterville, Stawell, and others. The acquisition will include one of the highest-grade gold mines in Victoria, the Nuggety mine with gold production of over 301,000 ounces at an extremely high mining grade of 184 g/t Au.
Portal to the A1 underground mine (L), High grade quartz vein with visible gold (R) Source: Kaiser Reef ASX Update 23 October 2020
Through the acquisition, Kaiser will have immediate gold production from its operating A1 gold mine. The ores would be processed at a fully permitted, and operating gold treatment plant through crushing, grinding and CIL processing to produce gold dore on site.
The board at Kaiser believes that the new acquisition is a compelling and value accretive purchase and provides an exceptional opportunity to its shareholders to benefit from the prevailing strong gold price environment.
Source: Kaiser Reef ASX Update 23 October 2020
Fund Raising program: Kaiser Reef is completing a fund-raising program of $7.5 million at a share price of $0.3 a share for another 25 million shares to ensure adequate funds for immediate exploration activities at Maldon and A1 mine and sufficient working capital.
Additional funds would be utilised to boost the cash reserves of over $3.5 million. Strategic cornerstone investors will have the right to take up to $3.7 million of the placements. Kaiser has been directed by the Australian Securities Exchange (ASX) to recomply under Listing Rules 1 and 2 and prepare a prospectus.
Kaiser Reef holds cash of $3.787 million as on 30 September 2020. The stock last traded at $0.41 a share on 14 September 2020.
All financial information pertains to Australian Dollar unless stated otherwise.