Blackham Resources Limited (ASX:BLK) to Acquire the Wiluna South and Williamson Gold Mines
Perth, Sep 21, 2011 AEST (ABN Newswire) - Blackham Resources Limited (
ASX:BLK) is pleased to announce it has executed a heads of agreement to acquire 100% of the Wiluna South and Williamson Gold Mines and the Regents, Carol Prior, Galaxy Gold Deposits in the Wiluna gold belt of Western Australia (Project). The 500km2 landholding surrounds the operating Wiluna Gold Mine owned by Apex Minerals NL (ASX:AXM). This region has produced over 4 million ounces of gold. The current Wiluna Gold Mine resource is 12.7 Mt at 5.4g/t gold (as reported by Apex Minerals NL in their 2010 annual Report).
No systematic regional exploration has taken place on the Project since Great Central Mines sold the Wiluna Mine and surrounding package to Normandy in 2002. Since 1996, the Project has been owned by numerous companies and most of the exploration has focused on the neighbouring Mine.
Blackham's main focus will initially be to explore for new gold resources in and around the Wiluna South Mine. Wiluna South is a large gold system which has been mined to less than 80m over a strike of 3.5kms. The existing deposits all remain open at depth. Asarco ceased production at Wiluna South in 1996 when the gold price ranged from US$395 to US$405/oz. Production from all previous owners reached approximately 280,000oz from 7 open-pits. Blackham intends to target the high grade extensions below the existing pits, remodel the existing resources and re-optimise based upon current gold prices.
There are also a number of grass-roots prospects with significant drill results that are yet to be followed-up. The Company expects other opportunities to be realised once a review of the 38,000 holes in the Project database is complete.
The Project has excellent existing infrastructure, located next to the township of Wiluna and serviced by regular freight and transport services, providing development advantages for new discoveries. All the existing deposits and resources are within a 20km radius of the Wiluna Gold Plant operated by Apex Minerals NL.
Blackham intends to acquire 100% the private company that owns the mining license, exploration and prospecting licenses following completion of satisfactory due diligence on the Project. Further information on the Project, including previous drill intercepts and resources will become available in due course.
Blackham management have spent the past 3 years looking for resource projects to complement its existing projects. The Blackham Board believes by acquiring these gold Projects and aggressively exploring and developing the existing deposits it can add significant value for shareholders. The Blackham directors and management all have extensive experience in the exploration and development of gold assets. Blackham also intends to continue progressing its Scaddan and Zanthus coal projects.
WILUNA SOUTH MINE
Wiluna South is a large gold system containing 6 historical open pits which have been mined to less than 80m. The mining from the pits has confirmed the system extends over a strike of 3.5kms.
Chevron (NYSE:CVX) and then Eon Metals mined the area between 1986-1992 and processed 2.5Mt @ 2.02g/t for 163,000ozs of gold. Asarco commenced mining Wiluna South in 1992 and ceased production in 1996 when the gold price was approximately US$400. During this time production was 1.5Mt at 2.46 g/t for 117,200ozs gold.
The potential at Wiluna South is highlighted by a reported intercept of 14m @ 12.15g/t, approximately 300m down-plunge of the previously mined pits. A number of mineralised zones intersected in shallow RAB drilling within the Wiluna South system also demonstrate consistent plunge geometry and down-dip potential but have not been tested at depth. The Wiluna South database includes 6,660 holes with the average depth of drilling is 49m; only 270 holes are deeper than 100m and only 53 holes are deeper than 200m, which presents a significant opportunity for the discovery of new deposits.
There are also a number of shallow intercepts outside the historical pit areas with no follow up drilling which provide additional open-pit targets.
Agincourt Resources Limited reported in its 2006 Annual Report an inferred resource covering the M2 and M10 pits. In 1996, Wiluna Mines also estimated Exploration Targets for the M1, M3, M4, M5 and M8 pits. This data has not been verified by Blackham as yet. Blackham intends target the high grade extensions below the existing pits and deposits, remodel the existing resources and run re-optimisation around the open pits based upon current gold prices.
WILLIAMSON GOLD MINE
The Williamson Gold Mine is located approximately 10km east of the Wiluna South Project and is situated on an extension of the Wiluna Mine Sequence under the shallow cover of Lake Way.
The Williamson North and South Deposits were previously mined by Agincourt Resources ceasing in early 2007 when the gold price ranged from US$610 to US$680/oz. A separate trend known as Carroll Prior was also identified, with resources1 defined by Agincourt which are yet to be verified by the Company.
Extensions of mineralisation were identified up to 200m below the surface at both Williamson and Carroll Prior but were never followed-up when the Project changed ownership later in 2007.
Blackham will prioritise drilling of the high grade targets below the Williamson pits and nearby Carroll Prior Deposit with a view to revising the resources and re-optimising the open pits.
REGENT DEPOSIT
A number of other highly prospective targets exist within the Project including the Regent Deposit.
Regent is located only 10km from the Wiluna Mill under thick transported cover and was initially discovered by Wiluna Mines. Subsequent owners conducted further drilling and estimated resources which are yet to be verified by the Company. Blackham's exploration team is currently reviewing the previous exploration and evaluating the potential for extensions such as Regent North.
TERMS OF THE AGREEMENT
Blackham agrees to purchase and the Vendors agree to sell to Blackham, 100% of the entire issued share capital of Kimba Resources Pty Ltd (Kimba) for the following consideration to be issued to the Vendors or their nominee(s) on Completion:
(a) Non-refundable Option Fee of A$50,000
(b) Cash on settlement of A$600,000
(c) 2,400,000 fully paid ordinary shares in Blackham;
(d) A$150,000 cash upon delineation of gold resources on the Tenements totalling 500,000 ounces gold (JORC);
(e) A$150,000 cash upon delineation of gold resources on the Tenements totalling 750,000 ounces gold (JORC);
(f) A$250,000 cash upon production of 50,000 ounces gold (g) A royalty of 1% net operating profit royalty on Nickel production profits.
The Vendors of Kimba are Buckland Capital Pty Ltd, Mr Clive Jones and Mr Nathan McMahon.
Kimba is obliged to pay certain gold and nickel royalties on parts of the tenure if these areas are bought into production. Kimba is required to pay A$500,000 to the previous owner on first gold pour payment. Kimba will be liable for the remaining rehabilitation on the Project and is required to pay A$2.249 million in environmental bonds on transfer of the mining leases from the previous owner to the Kimba.
This Agreement and the transactions contemplated by it are conditional upon Blackham completing, within 30 days of the date of this Agreement, such due diligence investigations and enquiries in relation to, or in connection with, Kimba and the Sale Shares as Blackham sees fit. During the Due Diligence Period Blackham has an exclusive right to elect to complete the transaction.
Blackham Managing Director, Bryan Dixon made the following statement, "It is not often you get an opportunity like this in your own backyard. This agreement allows Blackham to gain the largest landholding in one of Western Australia's major Archean greenstone belts that has produced over 4 million ounces of gold. The systems we are targeting have only limited shallow drilling and mining that took place when gold prices were a fraction of today's gold price. Only one of the targets has had systematic exploration on it in the last 15 years."
For the complete Blackham Resources announcement including figures and tables, please view the following link:
http://media.abnnewswire.net/media/en/docs/ASX-BLK-557929.pdf
About Wiluna Mining Corporation Ltd
Wiluna Mining Corporation (ASX:WMC) (OTCMKTS:WMXCF) is a Perth based, ASX listed gold mining company that controls over 1,600 square kilometres of the Yilgarn Craton in the Northern Goldfields of WA. The Yilgarn Craton has a historic and current gold endowment of over 380 million ounces, making it one of most prolific gold regions in the world. The Company owns 100% of the Wiluna Gold Operation which has a defined resource of 8.04M oz at 1.67 g/t au. In May 2019, a new highly skilled management team took control of the Company with a clear plan to leverage the Wiluna Gold Operation's multi-million-ounce potential.
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