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Central Victoria gold rush revival continues as ECR Minerals applies for licensing at an additional four sites following Newmont’s application a few weeks ago.
- Newmont Mining and ECR Minerals join Central Victoria gold rush revival
- Fosterville mine in Victoria expected to break production record
- Untouched potential in Victoria
- ECR Minerals fully funded through to June 2020 following strategic financing round
In recents weeks it was revealed that world’s second largest gold producer Newmont Mining (NYSE:NEM) had applied for the licensing of a large area of land in Victoria, bordering ECR Minerals (AIM:ECR) Bailieston and Moormbool gold projects.
ECR have responded by announcing four new license applications that will expand two of their existing holdings in the Victoria region. These include three strategically placed sites in the Bailieston/Moormbool project area which lie south and south west of the area Newmont recently applied for. It also includes an area that will expand the highly promising Creswick project over a southern portion of the Dimocks Main Shale (DMS) – which is believed to sit between two historically significant mining areas, estimated to have produced 15 million ounces of gold.
For ECR, Newmont’s application to move in next door was without a doubt further encouragement of the huge potential of their existing sites and appears to have encouraged them to move fast and extend licensing in strategic areas in the Victoria region.
ECR CEO Craig Brown said that the application submitted by Newmont bordering Bailieston and Moormbool gold projects “is an important ratification of our strategic Australian gold positioning.”
The presence of Newmont certainly adds weight to the potential prospectivity of the area. Brown added that ECR’s exploration work at Bailieston “has recently demonstrated gold prospectivity as highlighted by the results of our Bailieston sampling programme announced on 28 September 2018 with gold grades up to 67.4g/t.”
Victoria Gold Rush Revival
While the licenses all remain pending, the moves support what appears to be a highly promising revival for gold mining in the Victoria region.
Early this year Melbourne Mining Club chairman Richard Morrow told the The Australian Mining Review “The success of Kirkland Lake Gold at Fosterville has really lifted the profile of Victoria as a place to find gold, especially high-grade, underground mineable gold” (Australian Mining Review). The statement came after an estimated 1.7 million ounces worth approximately $2.85 billion was discovered at the mine in 2017 (Premier).
In November, Kirkland Lake Gold revealed the Fosterville mine located just 30km away from ECR’s Bailieston project had produced “exceptionally high grades”, with the mill grade in Q4
2018 averaging over 35.0 grams per tonne. Fosterville is now expected to break its own record quarterly production in the fourth quarter of 2018, pushing full-year predictions up to 330,000 ounces (Mining.com). Beyond this, it expects to achieve over 500,000 ounces per year by 2020.
Fostervilles ongoing success and the latest applications from ECR and Newmont certainly seem to support Richard Morrow’s statement. If accepted they will continue to push Victoria back into the spotlight amongst gold miners – a position it’s not held since the famous Victoria gold rush in the early 1850s.
Untouched potential in Victoria area
The 1850’s gold rush saw production skyrocket in Victoria as thousands of miners moved to the area after strong mineralisation was discovered in Ballarat in 1851. Levels were so significant that for a number of years gold output in Victoria exceeded that seen anywhere else in the world, bar the more extensive fields of California. Victoria’s greatest yield for one year was in 1856, when 3,053,744 troy ounces of gold were extracted.
However, by the early 1860s most diggers had moved North to New South Wales, then Queensland and across to Western Australia (WA), which now produces the majority of Australia’s gold. Despite this short period of extensive mining the state has still produced over 2,400 tonnes of gold or 32 percent of all the gold mined in Australia and 2 per cent of all the gold ever mined in the world. While WA has produced more, with 3,275.8 tonnes, much of this has been thanks to the booms of the last two decades where new technology has enhanced the discovery and extraction of gold.
WA has also undergone six separate development phases since the 1890s compared to Victoria’s initial rush in the 1850s as well as its current phase. However, contrasted on a yield per area basis, Victoria has an order of magnitude greater than any other Australian state producing an average of 10.8kg of gold / km2. Generating these significant levels of gold in such a period of time, without much of today’s technology would suggest the area remains full of potential – as the recent reports from Fosterville and ECR suggest.
If the old saying ‘the best place to find gold is in the shadow of the headframe of an old mine’ holds true then ECR are ideally placed to make the most of this golden opportunity. As well as Bailieston, they have licences granted in Avoca (EL5387), Timor (EL6278), Moormbool (EL6280) and Creswick (EL6184). As seen on the map above, all of these projects lie within close, if not direct proximity to historical sites known for significant levels of gold mining since the 1850s. These include; Ballarat, which ‘at its peak between 1852-1853 was recognised as probably the richest alluvial goldfield in the world, the Mt Alexander field at Castlemaine which in December 1851 was yielding 23,000 oz of gold a week, Creswick as already highlighted, as well as, Maryborough and Maldon (Earth Resources).
ECR Minerals fully funded through to June 2020
ECR has kicked off 2019 in style, signalling it’s ambitions to become a major Australia gold explorer with the announcement on January 2nd 2019 that it has applied for nine new exploration licences in an area called the Windidda gold project in Yilgarn, Western Australia. The Yilgarn Craton contains evidence of the oldest crust on Earth, and at almost 4km long, 1.5km wide and 500m deep, it’s world-famous Super Pit produces up to 800,000 ounces of gold per year alone.
There appears to be an overwhelming tide of evidence, both current and historical supporting further exploration and development at Central Victoria. While the Newmonts and Fostervilles will continue exploration and production at their own rate, based on the recent reports of high yields and strong yield per area results, it is ECR Minerals with 5 licensed sites and a host of additional plots pending that could be the investment opportunity of the century, and in pole position to capitalise on the untouched potential of Central Victoria. Clearly investors and shareholders think so too: ECR announced a strategic financing round, which together with warrants and shares totalling GBP1.77m will see the company fully funded to pursue operations through to June 2020. Directors Craig Brown and David Tang
both participated in the financing round. Either way, ECR investors could be sitting on a gold mine in the not so distant future.
By Harry Dacres-Dixon
References:
Australian Mining Review – http://australianminingreview.com.au/mining-in-victoria-good-as-gold/
Brand Communications – http://www.branduk.net/ecr-minerals-ecr-new-licence-applications-australian-gold-portfolio/
Earth Resources – http://earthresources.vic.gov.au/earth-resources/geology-of-victoria/exhibitions-and-Imagery/ history-mining-victoria
Mining.com – http://www.mining.com/kirkland-lake-golds-aussie-operation-breaks-production-record/ Premier – https://www.premier.vic.gov.au/bendigos-billion-dollar-gold-rush/
Value the markets – http://www.valuethemarkets.com/index.php/2018/11/15/exclusive-newmont-mining-secures-li cense-area-next-ecr-minerals-baileston-gold-project/
Geology for Investors – https://www.geologyforinvestors.com/gold-archean-greenstone-belts/
Kirkland Lake Gold – https://www.klgold.com/news-and-media/news-releases/default.aspx
Other companies http://kzr.com.au/wp-content/uploads/austocks/kzr/2018_06_20_KZR_1529488920.pdf
Share Talk Q&A with Craig Brown – Chief Executive Officer of ECR Minerals plc
We wanted to cover your Strategic Business Update released on 6 November 2018, but firstly should ask about your thoughts on market conditions?
How you feel about market conditions depends on positioning.
For private and institutional investors conditions are pretty awful although there is evidently a keen search by investors for stocks to acquire that could be positive performers even in present market conditions.
We have to demonstrate that ECR is in that category through our work and communications about our progress.
For resource companies on the markets, those with established businesses and cash can keep working through the downturn phase and make ready for the upturn.
ECR raised money in July and as a result, has the working capital to run until Q3 2019 as previously publicised. We are in a strong position operationally and financially and that makes us a positive investment proposition, in my view, at this time.
On the gold side of your business, Australia seems the focus right now. Why is that?
The Victoria region has been a stunning producer of gold over the years and was the location of one of the great nineteenth-century gold rushes. What’s better is that we believe there is considerable gold still to be discovered, and we are exploring for it right now.
We are greatly heartened by the exceptional success of the Fosterville mine in Victoria, which has produced more than a million ounces of gold to date and has ramped up production significantly of late, announcing record quarterly gold production of 90,000 ounces in Q3 2018. The mine is also notable for the discovery of significant bonanza grade mineralisation at depth in recent years. Fosterville is located in the same district as ECR’s Bailieston and Moormbool gold projects.
Our strategic and well-publicised objective is to find a substantial multi-million ounce gold deposit in the region and we are on an exciting pathway. We have published exploration results across a number of our many targets in the last few months and the results have been very exciting for the team.
We have already identified a gold system at the Blue Moon target and a large gold system at the Creswick target and more work is underway across the portfolio that will bring further updates to market.
In summation, we have multiple targets, very positive initial exploration results and our ongoing campaign is in full swing. There is a lot to aim for here and we have the resources and capable in-country team to get the work done.
You have mentioned Argentina and opportunities there in respect of “corporate avenues”. Can you elaborate?
I can’t be too specific, but we are pro-active in the background in Argentina and are reviewing a number of project opportunities and corporate options that may have the potential to add value.
Adding value is one thing, but we appreciate crystallisation of value is paramount for shareholders and we are very switched on to that.
Argentina is a resource-rich country and largely supportive of mineral exploration and development. We have strong and growing local relationships and there are increasingly more opportunities and more avenues we could pursue. We are active in moving initiatives forward and will update shareholders as soon as we have material progress.
The Iceberg due diligence is taking some time, in fact, more than originally planned, why is that?
We have been presented with a lot of data and are going through all the information.
One thing is key, acquisitions should be structured well and project due diligence conducted very carefully. If it takes more time to do a thorough job, all companies should do that and not be afraid to extend option periods. You protect shareholders that way.
Also, in the challenging conditions working capital is a scarce resource and there are a number of high potential projects available. Our job is to apply working capital to the best options and the process of due diligence ensures we do just that.
What other gold opportunities are you considering?
We have a good pipeline of Australian gold opportunities mainly in Victoria, Western Australia and the Northern Territory.
Whether we will pursue any additional projects depends on multiple factors including a project’s fit within the Company alongside our other gold interests; whether the project costs are comfortably within our management and financial resources; and whether we can see a value crystallisation route for shareholders.
We are looking at early stage exploration and projects with existing resources.
Turning to energy metals and minerals can you explain what you mean by “interest from third parties”?
As a Company, we are very excited by gold as a commodity focus, and we know our current and potential investors are too. That should not mean that we turn off to other opportunities and it has become increasingly clear to us that there is considerable interest in the energy metals and minerals segment.
The general interest of investors is a good thing and we need to be aware of that. However, there are also a number of organisations external to ECR who are keen to build a pipeline in energy metals and minerals.
In fact, the evident strategic drive to build this pipeline is demonstrated by the potential offer of capital to finance new ventures should the company be able to identify suitably meritable projects.
What is particularly appealing is the interest in ECR to act as a vehicle for new opportunities in respect of gold and energy metals & minerals.
Market conditions may be difficult but that is giving us a real opportunity to stand apart from the crowd by building our business in this downturn phase. The cash at bank and potential third party engagement helps of course.
Can you give us an indication of the type of energy metal or mineral project you are looking for?
Again, its difficult to answer too specifically as that information should be centred on market announcements. However, we have identified through our network various interesting projects in Australia and elsewhere. These are across multiple commodity categories including cobalt, copper, lithium, uranium and vanadium.
We want projects that our shareholders will appreciate and that can also engage the interest of new potential investors. We also want projects that can attract external finance with an emphasis on project level financing helping to reduce dilution at corporate plc level, something we know is very important to shareholders.
You seem very positive about the ECR business at the moment. What excites you the most about the business?
The work that goes into the Company is relentless at times, especially now with so much underway. So you need the excitement to keep you buoyed up.
I am delighted to be working closely with our Chairman David Tang, who apart from being very commercially minded, has an extensive network across many Asian countries and is able to bring ECR to the attention of that network. We have plenty of support provided we build our business with projects of real merit and potential.
It feels like it is ECR’s time but an intensive amount of effort is going in to make that happen.
ECR Minerals #ECR confirms potential for “significant gold discovery” at Blue Moon; discovers two new targets – via Proactive Investors
Via Proactive Investors 03 Sep 2018
ECR Minerals PLC (LON:ECR) shares spiked once on Monday as the miner confirmed the potential for a “significant gold discovery” at its Blue Moon prospect in Central Victoria, Australia.
In July, ECR told investors it was carrying out a technical review of the project after results from an initial drilling campaign provided “evidence of a significant near surface gold system”.
READ: ECR unearths significant mineralisation at Blue Moon
The review has backed up that earlier theory and suggested that there could be higher grade mineralisation a bit further below the surface, similar to the nearby 1mln ounce Fosterville mine.
As a result, ECR now plans to undertake more drilling at Blue Moon in “the coming months”.
In addition to the review, the explorer has also undertaken field mapping and soil sampling over previously unexplored areas just to the north and north-west of Blue Moon.
This work programme has identified two new prospective targets – called Red Moon and Yellow Moon – which share similarities with Blue Moon.
Further work on those two targets is due to begin shortly as ECR looks to better understand them and help determine a follow-up work programme.
Boss delighted with progress
“I am delighted with the progress our technical team have made with the review of Blue Moon,” said chief executive Craig Brown.
“It is evident that the Blue Moon target offers an opportunity to discover a significant gold deposit and that will be our prime objective in the forthcoming drill campaign.”
He added: “Furthermore, the addition of two new targets at Red Moon and Yellow Moon is extremely exciting for the technical team and the company.
“The multiple gold targets identified to date support the rationale of the company in securing the Bailieston licence with the overall objective being the discovery of a significant and economic gold deposit.”
ECR shares rose 16.2% to just shy of a penny in early trading on Monday.