This article is a sponsored feature from Mining.com.au partner Premier1 Lithium. It is not financial advice. Talk to a registered financial expert before making investment decisions.
A strategic move brought Premier1 Lithium’s (ASX:PLC) attention to promising near-term exploration opportunities outside of lithium that were already within its portfolio.
Over the past year, the junior explorer has been positioning itself to take advantage of the strong long-term fundamentals of the gold and copper markets, while also still not losing sight of the lithium potential.
A previous review of historical exploration data revealed the potential for gold and copper mineralisation within the company’s Western Australian projects.
Managing Director Jason Froud says Premier1 is positioning itself across commodities that are both in demand and aligned with global growth trends, while retaining exposure to lithium for the future.
“While lithium remains important to us – and we are well positioned to benefit when that market improves – as a junior it is difficult to justify significant lithium exploration expenditure in the current environment,” he tells Mining.com.au.
“Gold and copper, on the other hand, provide the strongest uplift from exploration success.”
Premier1’s Yalgoo and Abbotts North projects are large landholdings in proven mineral belts, yet both remain highly underexplored.
Yalgoo lies within the Yalgoo-Singleton Belt, which hosts deposits like 29Metals’ (ASX:29M) Golden Grove volcanic-hosted massive sulphide deposit containing a resource of 53.8 million tonnes at 1.7% copper 40km to the south, and Vault Minerals’ (ASX:VAU) 2.9-million-tonne Deflector gold-copper mine 50km to the southwest.
The belt is also proving attractive to larger players as is evidenced by $4.79 billion Capricorn Metals’ (ASX:CMM) recent $188 million play for Warriedar Resources (ASX:WA8).
Warriedar owns the Golden Range project, which has a resource of 24.5 million tonnes at 2.5 grams per tonne for 1.96 million gold equivalent ounces.
Meanwhile, $6.41 billion Ramelius Resources’ (ASX:RMS) 5.2 million @ 1.4g/t Melville deposit sits immediately to the north of Warriedar.
Yalgoo review reveals forgotten high-grade intercepts
Froud was surprised at what the review revealed at Yalgoo in particular, with historical data showing numerous high-grade, near-surface intercepts that have been largely untouched since the 1980s.
Specifically, the review showed a number of walk-up targets and more than 25km of prospective strike for gold and copper.
Since that revelation, Premier1 has defined a maiden inferred resource of 150,000 tonnes @ 2.7g/t gold containing 13,000 ounces at the Wadgingarra prospect.
“Although modest in size, Wadgingarra’s near-surface mineralisation and good grade make it potentially amenable to low-cost open pit mining,” Froud explains.
“Importantly, the deposit remains open at depth and along strike, offering immediate growth potential.
“Given the number of toll treatment plants in the Murchison, even small high-grade deposits can be very attractive — and we see strong potential to scale Wadgingarra quickly with systematic drilling.”
This growth potential could likely come from the underexplored structures of Carlisle, Crescent South, and Mt Kersey.
At Crescent South, drilling by Premier1 returned a hit of 3m @ 30g/t in the southernmost hole, with the structure mapped for kilometres further south and never tested.
Drilling at Carlisle, meanwhile, delivered intercepts including 7m @ 4.3g/t gold, with only half a dozen holes drilled and the system remaining open in all directions. Premier1 is most encouraged by Mt Kersey because of a gold-in-soil anomaly coincident with a multi-element pathfinder anomaly hosting tellurium, bismuth, arsenic, copper, molybdenum and zinc.
The tellurium and bismuth continue for more than 2km and both are strongly correlated with gold mineralisation at Yalgoo. Rock chips show grades of up to 26g/t gold.
“Mt Kersey offers both scale and grade potential – and it has never been drilled,” Froud notes.
“These are the sorts of structures that could host new discoveries and potentially add significant value to our portfolio.”
Profit-sharing model reduces upfront capital
With the strategy now to monetise smaller, high-grade deposits, Premier1 is considering bringing in a mining services partner to explore a profit sharing arrangement.
This is aimed at generating early cashflow in an environment where the gold price has hit yet another record, reaching over US$3,600 ($5,496) per ounce.
Froud says while it is too early to go into details on specific processing plants, there are multiple operating treatment facilities in the vicinity of its landholding in the Murchison region.
The definition of the initial resource at Wadgingarra was designed to demonstrate the potential for economic mineralisation and whether it warranted further investment.
With a resource grade of 2.7g/t, Froud says the material will travel quite well and there are a number of processing plants in the area that will be looking for feed within Premier1’s targeted development timeframe.
The average drill depth is also very shallow at 40-50m below surface.
Froud tells this news service the company reported the resource within a realistic pit optimisation, which provides an early indication of economic potential given the nearby processing plants.
“This means Wadgingarra could be developed without the need for Premier1 to build its own processing plant,” he says.
“That creates a potential low-capex pathway to monetisation, while we continue exploration aimed at growing the resource and testing new targets.”
A mining services partnership will provide the necessary development and operating capability, including mine planning, geotechnical, hydrology and metallurgy – areas that would otherwise rely heavily on consultants.
This enables Premier1 to fast track the Wadgingarra resource towards commercialisation.
“It also enables us to ring-fence the Wadgingarra resource area, allowing specialists to advance a mine-to-mill solution while Premier1 remains free to focus on exploration across the broader Yalgoo and Abbotts North projects,” Froud adds.
“This model reduces upfront capital requirements, de-risks the project, and positions us to generate cashflow sooner, with capital recycled back into exploration.”
Exploration pipeline aimed at resource expansion
Premier1’s 180km2 Abbotts North is an earlier stage project than Yalgoo and has had virtually no gold exploration, but the more the company investigates the more potential it sees.
The project sits directly along strike from New Murchison Gold’s (ASX:NMG) Crown Prince deposit, containing a resource of 2.2 million tonnes @ 3.9g/t for 279,000 ounces that is hosted on a splay off the Abernethy Shear Zone — a major structure that extends into Premier1’s ground.
Rock chip samples taken from the newly identified Rochefort prospect returned grades of up to 11.7g/t and confirmed a new quartz vein system.
Mapping and sampling defined a surface mineralised footprint of at least 40m by 40m that is open to the south under shallow cover.
Froud says the geological setting at Abbotts North is highly analogous to that which hosts the Crown Prince deposit.
“Crown Prince demonstrates that deposits in this belt can have small surface footprints but carry significant ounces, highlighting the untapped discovery potential at Abbotts North,” he says.
“The limited historical exploration means the area is still at an early stage, but the structural setting, proximity to Crown Prince, and early geochemical and rock chip results all point to analogous mineralisation being present.”
Froud believes Abbotts North has all the ingredients needed to uncover a Crown Prince-style deposit: the right structure, the right host rocks, and the first signs of gold mineralisation already evident at surface.
Over the next six to 12 months, Premier1 is aiming to achieve resource growth and confidence at Wadgingarra, test priority targets and begin exploration at Abbotts North.
The company plans to drill along strike and at depth from known mineralisation, as well as twinning older holes to improve confidence and interpretation.
Froud says Premier1 is well positioned at the intersection of near-term development and longer-term discovery.
“With a maiden gold resource now in hand, a pipeline of underexplored targets, and a clear strategy to fast-track development, we are building a diversified growth story in one of WA’s most prospective greenstone belts,” he says.
Write to Angela East at Mining.com.au
Images: Mining.com.au & Premier1 Lithium
