Newcrest completes Stage 2 and commences Stage 3 of Farm-in at Havieron
Greatland Gold plc (AIM:GGP), the precious and base metals exploration and development company, is pleased to provide an update on Newcrest’s activities at Greatland’s Havieron Project in the Paterson region of Western Australia. In addition, Greatland provides an update on the impact of COVID-19 on its own exploration activities in the Paterson region (excluding the Havieron Project).
Greatland notes the release of an ASX announcement titled “Newcrest earns 40% interest in Havieron” by Newcrest Mining Ltd (“Newcrest”) earlier today.
Newcrest’s Activites at the Havieron Project
· Drilling activity at Havieron is continuing as planned with eight rigs currently operational.
· Newcrest has implemented measures to mitigate the risks of the COVID-19 pandemic to its project workforce and stakeholders and is continuing to closely monitor developments.
· Newcrest has successfully completed Stage 2 of the Farm-in Agreement (US$20 million in expenditure to date) and has commenced Stage 3 of the Agreement.
· In accordance with the Farm-in Agreement, following completion of Stage 2, Newcrest now has a 40% interest in a 12-block area within E45/4701 that covers the Havieron target , with the remaining 60% interest retained by Greatland.
· In order to complete Stage 3 of the Farm-in Agreement, Newcrest must spend an additional US$25 million and deliver a Pre-Feasibility study for the Havieron Project.
· Newcrest continues infill drilling to support the delivery of a maiden resource in the second half of calendar year 2020 and continues to investigate the potential to start an exploration decline at Havieron by the end of calendar year 2020 or early 2021.
· Newcrest will provide updated Havieron drilling results in its Quarterly Exploration Report to be released on 30 April 2020.
Greatland’s Exploration Activities in the Paterson Region (excluding Havieron)
· Due to COVID-19 related issues, Greatland’s exploration activities in the Paterson, which were originally scheduled to commence in April 2020, are being temporarily delayed.
· The commencement of cultural heritage clearances required for drilling activities has been deferred due to the potential impact of COVID-19 on the Martu People of the Central Western Desert region in Western Australia.
· Greatland will seek to commence its exploration activities in this region as soon as it is practical to do so and will provide further updates over the coming weeks.
· Greatland is in a strong financial position and remains well financed to conduct all planned activities during calendar year 2020.
Gervaise Heddle, Chief Executive Officer of Greatland Gold plc, commented: “The commencement of Stage 3 of the Farm-in Agreement by Newcrest represents an important milestone in the life of the Havieron Project as it now officially moves into the Pre-Feasibility Study stage of development. In just over 12 months, Newcrest has delivered six consecutive sets of excellent drill results at Havieron, which support the potential for both high grade selective and bulk mining methods. We are delighted by Newcrest’s ongoing commitment and we look forward to reporting further results as work continues towards the next major milestone at Havieron, the delivery of a maiden mineral resource in the second half of the 2020 calendar year.
“Over the past few weeks, we have all been impacted in both our personal and professional lives by the COVID-19 outbreak. During this challenging time, Greatland’s priority remains the health and safety of our people, our partners and the communities in which we operate. For this reason, we have put on hold our exploration activities in the Paterson, including an Airborne Electromagnetic survey and drilling at Scallywag. Our team is using this time to further refine targets and we will be ready to commence exploration as soon as it is safe and responsible to do so”.
Background to Havieron and Farm-in Agreement with Newcrest
In March 2019, Greatland entered into a Farm-in Agreement with Newcrest Operations Limited, a wholly-owned subsidiary of Newcrest Mining Limited (ASX:NCM), to explore and develop Greatland’s Havieron gold-copper discovery in the Paterson region of Western Australia. Newcrest has the right to earn up to a 70% interest in a 12-block area within E45/4701 that covers the Havieron target by spending up to US$65m. Newcrest may acquire an additional 5% interest at the end of the Farm-in period at fair market value.
Newcrest has completed Stage 2 of the Farm-in Agreement. In accordance with the terms of the Agreement, Newcrest has earned a 40% interest in the Havieron Project and has provided notice to Greatland that it is proceeding to Stage 3.
In order to complete Stage 3 of the Farm-in, Newcrest must incur an additional US$25 million in expenditure and deliver a Pre-Feasibility study for the Havieron Project. If Newcrest successfully completes Stage 3, Newcrest will earn an additional 20% Farm-in Interest (cumulative 60% Farm-in interest).
During the Farm-In period, Newcrest will have a first right of refusal over the remainder of Greatland Gold’s Paterson projects (Black Hills, Paterson Range East and remainder of the Havieron licence). The Farm-in Agreement includes tolling principles reflecting the intention of the parties that, subject to a successful exploration program and feasibility study, the resulting joint venture ore will be processed at Telfer, located 45km west of Havieron.
Exploration activities at Havieron are operated by Newcrest under a Farm-in Agreement with Greatland. The Havieron deposit is centred on a magnetic anomaly located 45km east of Telfer. Exploration drilling by Greatland during 2018 resulted in the discovery of significant gold and copper mineralisation under 400m of post mineral cover. Newcrest commenced drilling at Havieron during the June 2019 quarter.
Results to date support potential for both high-grade selective and bulk mining methods, which are currently being evaluated. An additional 20,000 metres of drilling is planned by Newcrest to support the objective of delivering a maiden resource estimate in the second half of calendar year 2020. A number of environmental, geotechnical and metallurgical studies are continuing in order to support a potential mineral resource estimate, and future permitting requirements.
Deposit mineralisation is hosted by metasedimentary (meta-sandstones, meta-siltstones and meta-carbonate) and intrusive rocks. Gold and copper mineralisation is hosted in breccia, vein and massive sulphide replacement styles, typical of intrusion-related and skarn types of mineralisation. The main sulphide mineral assemblage contains well developed pyrrhotite-chalcopyrite and pyrite. Alteration assemblages associated with mineralisation are amphibole-carbonate-biotite-sericite-chlorite. Higher grade gold zones (+10g/t Au) are often associated with quartz/chalcopyrite-pyrite veining.
Background to Greatland’s Paterson project
Greatland’s Paterson project covers more than 385 square kilometres in the Paterson region of Western Australia and includes the Havieron licence, the Paterson Range East licence, and the Black Hills licence.
Greatland’s exploration activities in the Paterson, including an Airborne Electromagnetic (“AEM”) survey and drilling at Scallywag, which were originally scheduled to commence in April, are expected to be delayed due to COVID-19 related issues. The commencement of cultural heritage clearances has been deferred due to the potential impact of COVID-19 on the Martu People of the Central Western Desert region in Western Australia. Greatland will seek to commence its exploration activities in the Paterson as soon as practical and will provide further updates over the coming weeks. Greatland remains in a strong financial position and is well financed to conduct all planned activities during calendar year 2020.
A regional map showing the Havieron licence area and Greatland’s Paterson licences can be found at: www.greatlandgold.com/paterson
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