Aruma Resources: renewed focus with the blinkers off amid changing of the guard

This article is a sponsored feature from Mining.com.au partner Aruma Resources Ltd. It is not financial advice. Talk to a registered financial expert before making investment decisions.

A growing global population and ever-expanding technological development have considerably increased demand for various critical minerals to the point it’s altered the direction of the mining industry and explorers alike.

Until recently, critical minerals and rare earth elements (REEs) in particular were relatively unknown outside of those who occupied a niche métier within mining’s many echelons.

Yet such is the importance and need of these raw materials, exploration companies with exposure to them tend to embrace the mining and value proposition with vigour. Even if their initial minerals focus was elsewhere.

While Aruma Resources (ASX:AAJ) has predominantly been exploring for gold, in February the company unveiled it had uncovered REEs at its 100% owned Saltwater Gold Project in the Pilbara region of Western Australia. 

Now with plans to pursue the rare earths potential at the Saltwater Project, newly appointed Managing Director Glenn Grayson has officially signalled a changing of the guard at the company.

He tells Mining.com.au Aruma is casting a wide net with an open-minded drive towards exploration.

“The blinkers are off with respect to what we are in search of. We will be targeting REEs at Saltwater, as well as gold and anything else that we identify. If we see something that will add value to our projects then we will follow that up.”

“The blinkers are off with respect to what we are in search of. We will be targeting REEs at Saltwater, as well as gold and anything else that we identify”

Rare earths in particular are found in applications in disparate fields, such as magnetic, metallurgical, nuclear, chemical, catalytic, electrical, and optical. They are essential in hybrid-car batteries, phosphorescent lamps, portable electronic devices, and wind turbines.

Under the common models in which REEs are generally found, those associated with sedimentary rocks can also be associated with gold and base metals, meaning uncovering REEs is not actually that rare. 

Aruma has identified an interpreted reactive lithology extending over a total linear target of in excess of 80km of prospective shales. The company is undertaking a targeted fieldwork program at Saltwater designed to position Aruma with a first-mover advantage in what is an emerging rare earths province.

The Saltwater Project consists of 4 granted exploration licences over 450km-square.

Changing of the guard

In January, Aruma appointed then Chief Operating Officer Grayson as MD who replaced the company’s founding MD Peter Schwann who led the company since its listing in 2010. Grayson has played a key role in advancing the company’s portfolio of prospective lithium and gold assets in Western Australia over his tenure at Aruma.

While his predecessor may have had a different approach to exploration, Grayson says his vision is to continue moving forward while assessing all of Aruma’s options with due diligence.

“I guess it’s a fresh set of eyes looking at things, as we change. It’s not the Aruma of old which previously operated with a different perspective and I’ve taken over the company and it’s a bit of a shake up in the way things are being done. We’re looking at the gold, but we’re also pushing the lithium and we’re looking for rare earths, and it’s just that we haven’t got blinkers on any one commodity.”

“I guess it’s a fresh set of eyes looking at things, as we change. It’s not the Aruma of old which previously operated with a different perspective…”

While the new MD says his approach is not aggressive, as an experienced exploration geologist, he does want Aruma to be proactive and open-minded about the opportunities that unfold before the company.

“I’ll cast my net a bit wider and try and understand what’s going on to look at what might be there. The way I’ll operate is to step back and have a big picture look and try and work out what might be going on first and then go in and test the ground for what we might have outside of the known gold.

I think the multi commodity approach is certainly healthy in the current climate. The commodities we’re looking for too, I think are all pretty desirable.”

Shareholders agree and have expressed support in the direction the company is taking by assessing the gold and rare earths in particular in a different light, says Grayson, who has in excess of 27 years’ experience as a geologist and strong depth of technical expertise in gold exploration and development in Western Australia and Victoria.

“We’ve been trying to explain to them (shareholders) what the potential might be and they’re all excited about it.”

Refreshing look at Saltwater

Under his guidance, Aruma has targeted available ground that fits its mineralisation model while specifically looking for prospective terrain that has for various reasons been previously overlooked.

The company’s Mt Deans assets is a tantalum-rich pegmatite outcrop, which had not previously been sampled for lithium. Carter Well is mapped as granite but has not previously been explored yet has a mafic greenstone outcrop.

At Saltwater, local indigenous people have successfully prospected for gold nuggets, however it is completely unexplored for precious metals and rare earths. Meanwhile, the company’s main focus is at Salmon Gums where the next phase of drilling is underway, following up on previous bonanza grade gold intersections.

The MD explains to this news service that of those assets, Saltwater Project offers a unique and refreshing opportunity for Aruma.

“It’s going to be a methodical process with Saltwater, it’s a big area and it’s very remote”

“It’s going to be a methodical process with Saltwater, it’s a big area and it’s very remote. It’s getting up there and passing a wide net, as we’ve got 80km of strike of the stratigraphy that we think has the most potential to host something.”

The MD says the company’s approach to Saltwater will be somewhat measured with several site visits expected to occur over the coming 3-4 months to take rock chip samples.

Aruma has already undertaken a more detailed site visit, where it conducted a surface sampling program. Samples will be sent for laboratory analysis, and subject to results it will then complete a geophysical survey and mapping program with a view to defining targets for a maiden REE-focused drill program.

Ideally, the project is also situated some 100km south-west of the regional mining centre of Newman. The project was originally pegged by Aruma in 2020 for its gold prospectivity, based on the reactive stratigraphy adjacent to the Nanjilgardy Fault within the project area that controls about 6 million ounces of known gold mineralisation along its entire strike. Aruma’s exploration at Saltwater to date has been gold-focused and has consisted of 2 phases of reverse circulation (RC) drilling within a targeted area.

Rare earths have common applications

The newly installed MD notes that the reason Aruma will take a measured and cautious approach to Saltwater is that it will need to investigate the complexities not only of the minerals, but the broad and disparate end users they will eventually attract. He says the importance and uses of REEs are not as well understood as many commodities such as gold and lithium applications and it is still early stages of Aruma’s understanding of what is in the ground.

“The historic results only list REEs and not the specific elements within the series. Our neighbours (Dreadnought Resources) are reporting heavy rare earth elements and specifically neodymium.”

Neodymium

Neodymium is a hard, slightly malleable, silvery metal that quickly tarnishes in air and moisture. When oxidised, it reacts quickly and is generally regarded as having one of the most complex spectra of the elements.

The metal has an unusually large specific heat capacity at liquid-helium temperatures, so is useful in cryocoolers and also has applications for glass and in lasers.

Neodymium magnets are the strongest permanent magnets known. A neodymium magnet of a few tens of grams can lift a thousand times its own weight and can snap together with enough force to break bones. While these magnets are superior, cheaper, lighter, and stronger than samarium–cobalt magnets, they do lose their magnetism at lower temperatures and tend to corrode, which samarium–cobalt magnets do not.

In H1 2022, there was market tightness for neodymium, which was accelerated by above-market Chinese demand investment in neodymium-iron-boron magnet capacity. However, in recent times China reaffirmed its dominance of the rare earths by significantly ramping up its mining and refining quotas. In 2021, China produced the most REEs at 168,000 metric tons, with the second largest producer being the US with just 43,000 metric tons.

In terms of potential types of end users for Aruma’s REEs products should it one day become a mine, Grayson says the situation is continually evolving, adding that such customers are needed to be developed as the critical minerals space develops.

Magnet for the market

Moving forward, the near-term growth objectives for Aruma are clear although the rare earths will be an attractive value and investment proposition for the market.

The MD says: “I still see potential in the Norseman Lithium Project. I think lepidolite will become every bit as important a source for lithium as spodumene currently is. The drilling currently being done at Salmon Gums is really important to us. If we can grow the footprint of the high-grade gold then that will be substantial. And getting up to Saltwater to do a major sampling campaign is exciting.”

“The drilling currently being done at Salmon Gums is really important to us”

Aruma already has some grab samples and historic data which has put the company on the front foot with Saltwater. An assessment of historic exploration within the project area has revealed REE, base metals, gold, and uranium results from previous explorers in the region. U308 Limited (U308) reported ‘extremely high’ assays results up to 11% rare earths at the Sirius and Lavanto prospects within the area in 2010, in grab samples.

Previous exploration by U308 also delivered grades of up to 3.1% Cu, 1.4% Pb, 1.5% V (vanadium), and 2g/t Au in samples from costeans at the Nobbys prospect. Aruma also plans to pursue the multi-commodity potential of the project area in its planned fieldworks programs. Other REE occurrences have been recorded at Saltwater in drillholes and surface samples. The status of the Saltwater area as an emerging REE province has been consolidated by Dreadnought Resources (ASX:DRE) and its recent pegging of a significant landholding at its Bresnahan Project, immediately adjacent to Saltwater.

Meanwhile, Aruma has begun the next phase of drilling at its Salmon Gums Gold Project, following up on previous bonanza grade gold intersections. This phase of drilling will consist of 47 reverse circulation (RC) holes for 5,500m, and a 1,026 sample shallow auger drilling program and is designed to follow-up previously recorded ‘high-grade’ intersections. It will also test ‘strong’ coincident gold and arsenic in soil anomalies to extend the current known gold mineralised areas at the Iris and Thistle prospects.

Grayson notes: “Hopefully we will identify more high-grade gold in the Thistle area and extend this. Additional drilling and gold results will help us understand the gold mineralisation further and allow us to immediately follow-up with more drilling.”

He adds that testing ‘strong’ coincident gold and arsenic in soil anomalies is important.

“The Norseman style of mineralisation is very coincident with arsenopyrite, so a strong arsenic and gold in soils anomaly is a very good start. Surface soil sampling of the wheatbelt is difficult to analyse in that the soil has been mechanically re-worked by farmers for decades. This is why we are doing some auger sampling. We believe that taking a sample greater than 1m depth will give us a much more reliable test of the areas for mineralisation.”

Write to Adam Orlando at Mining.com.au

Images: Aruma Resources Ltd
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Written By Adam Orlando
Mining.com.au Editor-in-Chief Adam Orlando has more than 20 years’ experience in the media having held senior roles at various publications, including as Asia-Pacific Sector Head (Mining) at global newswire Acuris (formerly Mergermarket). Orlando has worked in newsrooms around the world including Hong Kong, Singapore, London, and Sydney.