Syndicated Metals (ASX: SMD) announced that it has entered into an agreement with Gateway Mining Limited to purchase 80% of the high-quality Edjudina Gold Project in WA.
With this acquisition, Syndicated has secured a second major land-holding in the Laverton Gold District of Western Australia. The land-holding is in a prolific gold mining district, close to several major deposits.
The Project consists of four granted tenements with multiple gold anomalies located directly along strike from Matsa Resources Fortitude Gold Project.
The company said that at the Hornet Prospect, > 5km2 of surface and transition gold anomalies remain open and poorly tested, while at the Phantom Prospect, surface and transition gold anomalies over approximately 6km remain unexplained and poorly tested.
The transition gold anomalism > 1 g/t Au in two shallow aircore holes with associated gold bearing plume stretches several hundred metres laterally and along strike.
The company said that both prospects have a similar geochemical signature to the Tropicana Gold Project, suggestive of potential to host a major gold deposit.
Edjudina gold project
The Edjudina Gold Project is located in the southern portion of the Laverton District, around 700km north-east of Perth.
The Project consists of four granted exploration tenements, E31/1134, E31/1150, E39/1765, and E39/1882 and is located in the highly mineralised Laverton Tectonic Zone of the Eastern Goldfields Province of the Yilgarn Craton and is considered prospective for gold and nickel-copper mineralisation.
Two of the important prospects of Edjudina are Hornet and Raptor.
Previous work on the Edjudina tenure during the 1980s and 1990s included soil sampling, geophysics (both airborne and ground-based), air core (AC) drilling, and minimal reverse circulation (RC) drilling.
Several gold-in-soil anomalies were identified during previous exploration programs in particular at Hornet and Raptor prospects.
The company said that both areas of soil anomalism were the subject of shallow AC drilling to the base of weathered rock and both demonstrated significant, lateral and strike extensive, unexplained transition gold anomalies.
The company reported that at Hornet Prospect, two intervals at the transition from weathered rock to fresh rock, within what is logged as a mafic-rich variant of basement, remain open and unresolved.
The more prospective transition anomaly intersections included 3m @ 1.6 g/t Au (from 41.0m to EOH in hole 1650/7250), including 1.0m @ 4.6 g/t Au; and 1.0m @ 2.0 g/t Au (from 47.0m in hole 1650/7247).
The company said that Shallow air-core drill testing at the Raptor prospect demonstrated a potential relationship between surficial soil and transition bedrock gold anomalism with shallow AC drilling along the anomaly failing to penetrate below the transition into true fresh rock and failing to explain adequately the source of what is a very large, very continuous gold anomaly.
Similar to Tropicana gold project
The company reported that its Hornet and Raptor prospects have a similar geochemical signature to the 6 million ounce Tropicana gold project.
SMD said that there is geological similarity between the gold anomalies at Edjudina and the early stage exploration results from the Tropicana deposit owned by AngloGold Ashanti Australia Ltd and Independence Group NL.
The company reported that when comparing the early soil anomaly and drill section from Tropicana, the same gold depletion within the saprolite as that present at both Hornet and Raptor and a very similar tenor and size soil anomaly derived from sampling sand dominated regolith was present at Tropicana.
Prolific gold mining district
Syndicated reported that the Laverton district hosts numerous major gold deposits, including Anglogold Ashanti’s Sunrise Dam >10 Moz gold mine, Saracen Mineral Holdings (ASX: SAR) >2 Moz Carosue Dam gold mine and Matsa Resources (ASX: MAT) >0.5 Moz Red October gold mine.
The company noted that the Laverton District has historically produced greater than 30 Moz of gold, the southern part which remains relatively under-explored despite 30 years of work since the discovery of Sunrise Dam in 1988.
The company said that the region continues to attract ongoing and strong interest with active exploration programs being undertaken by major and mid-tier operators including St Barbara, Saracen Minerals, AngloGold Ashanti, and Apollo Consolidated among others.
Terms of agreement
A per the purchase agreement signed with Gateway Projects Pty Ltd, a wholly-owned subsidiary of GML, Syndicated has the right to purchase an 80% interest in the four exploration tenements comprising the Edjudina Gold Project.
The agreement states that SMD will conduct a due diligence process by 30 November 2019. At completion of diligence process, SMD will pay Gateway Projects $250,000 in consideration. SMD may elect, at its sole discretion, to pay up to $200,000 of the consideration in SMD shares.
The agreement states that SMD will grant Gateway Projects a 1.5% royalty on future production greater than 200,000oz of gold or equivalent.
As per terms of the agreement, Syndicated and Gateway Projects will enter into a joint venture in respect of the Edjudina Gold Project. Syndicated will manage the joint venture and Gateway Projects will be free carried until a decision to mine.
The company reported that a number of exploration targets, particularly the Hornet and Raptor prospects of the Edjudina Gold Project will be progressively tested, with the aim of defining their geological drivers and the sources of the gold anomalies.
The company said that the exploration programs at Edjudina would commence once approvals from the Department of Mines, Industry, Regulation, and Safety (DMIRS) are received.
Syndicated’s Managing Director David Morgan said: “With the addition of the Edjudina Project to our growing portfolio of highly prospective gold projects in Tier-1 WA locations, the Company is well positioned to benefit from exploration success in the current strong gold price environment.
Of particular interest is the tantalising geological similarity between Edjudina and the early discovery stages of the 6Moz Tropicana Gold Project. We are really looking forward to getting on the ground and putting this theory to the test with systematic exploration programs.”