Venus locks in mining lease for WA Sandstone gold project
The newly secured tenure covers the company's 30,500-ounce gold resource and firmly sets the stage for a potential open-pit operation.
Achieving mining lease status is a critical step towards monetising the deposit at a time when gold prices are nipping at the heels of all-time highs of more than $5100 per ounce.
The lease, which spans 415 hectares, includes the broader Range View area where a recent drilling program unearthed some compelling numbers.
Standout shallow reverse circulation hits from the Bellchambers deposit include 29 metres at 1.55 grams per tonne (g/t) gold from 11m, 30m at 1.72g/t from 45m and a chunky 19m at 3.74g/t from 11m.
Meanwhile, the company's nearby Range View and Range View South prospects have continued to impress with wide intercepts of 13m at 1.60g/t from 19m, 18m at 1.24g/t from 47m and 9m at 1.12g/t from 17m.
Venus says the results at Bellchambers hint at a broader mineralised system and set the tone for what it hopes will evolve into a cash-generating open pit.
The current mineral resource on site totals 722,000 tonnes grading 1.31g/t for 30,500 ounces of gold. Notably, 22,100 ounces sit in the indicated category, providing a level of confidence as the company pushes the project towards production.
To further de-risk the development, Venus has completed two diamond holes to support geotechnical analysis and metallurgical test work. Samples are now in the hands of ALS Laboratory Group for metallurgical evaluation to fine-tune gold recoveries and optimise the pit design.
With additional data in hand, Venus says it expects to deliver a revised mineral resource estimate at Bellchambers within the next month. Apart from providing a tasty uplift in the size of the resource, the update will also offer further valuable insights into pit optimisation studies and mine layout plans. These plans are in the hands of an experienced Kalgoorlie-based mining engineering team.
The upgraded lease additionally allows Venus to finalise a mining development and closure proposal. The company is fielding contractor quotes to get that box ticked.
Moving on to processing, Venus is in advanced discussions on a possible farm gate sale or toll treatment with nearby Rox Resources. Rox owns and operates the Youanmi gold project, which hosts 16.2 million tonnes at a grade of 4.4 grams per tonne for 2.3 million ounces of gold. The project, 70km south of Bellchambers, is in the latter stages of a final investment decision on its own development.
A straight ore sale or a processing agreement with Rox would neatly sidestep the need for Venus to build a standalone plant, thereby front-loading cash flow from the project and negating the huge capital costs involved.
Elsewhere at the company's Henderson project near Menzies, early drilling under the historic Hilltop mine has hit paydirt and is shaping up as another standout project.
A juicy intercept of 4m going 10.3g/t gold, including a blazing 1m at 25.1g/t, suggests the old workings still have plenty of sting in the tail. Rock chip samples collected nearby have turned up grades as high as 77g/t, adding more fuel to the fire. A follow-up drilling campaign is already on the drawing board.
Meanwhile, on another of its leases near Youanmi, Venus has uncovered what could be a copper monster. A recent ground survey revealed a whopping 5000 Siemens electromagnetic anomaly.
The company is now targeting the eye-catching bullseye with reverse circulation and diamond drilling. Results are expected within weeks. Shallow zinc hits in the same area are also in line for infill drilling, with an updated resource potentially on the horizon.
Adding to Venus' extensive inventory, the company owns 55 million shares in Rox worth $17.35 million and a 1 per cent royalty over the Youanmi mine. The royalty was independently valued 12 months ago at $9.5 million, when gold prices were 40 per cent lower.
With so many irons in the fire and a market capitalisation of $21 million - backed by almost $18.5 million in cash and liquid assets - Venus has built a compelling story.
By adding a granted mining lease across 30,000 ounces of gold, the company appears locked and loaded to move up the development curve and potentially onto the list of WA's next producers.
Is your ASX-listed company doing something interesting? Contact:
matt.birney@wanews.com.au
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