Norwest (ASX:NWM) is raising $3.144m to put some holes into the Arunta West iron-oxide copper-gold (IOCG) and Bulgera gold projects, both in Western Australia.
Major shareholders have already confirmed that they will take up their full or partial entitlement up to about $2.162m.
And in a sign of confidence, Norwest chairman Michael Tilley and CEO Charles Schaus will partly underwrite the issue to $150,000 (but won’t charge any underwriting or other fees).
Schaus says the cash will give Norwest the financial power to “get in there and have a good crack” at some very exciting targets.
North Dovers: the greenfields company maker
IOCG deposits like BHP’s (ASX:BHP) Olympic Dam, can be colossal; just imagine a resource so large it would take five centuries to deplete.
That’s the kind of region defining, multi-generational mines IOCG deposits can become.
For Norwest, the North Dovers target at Arunta West represents a huge opportunity.
The target is defined by a large, 8km by 4km coincident magnetic-gravity anomaly and geological features which are very similar to Olympic Dam.
Maiden drilling in May confirmed the project’s potential, intersecting thick sequences of favourable IOCG geology and alteration including chalcopyrite (copper ore), pyrite and sphalerite (zinc ore) mineralisation (image in header).
Importantly, the North Dovers bedrock was encountered near surface, which means the mineralisation can be effectively drilled using less expensive reverse circulation (RC) rigs.
(Unlike BHP, which had to punch through at least800m of cover before reaching mineralisation at the recent Oak Dam West discovery.)
This project is Norwest’s long game, Schaus told Stockhead.
“We had some good results in May from the maiden program,” he says.
“And we found that the basement rock is closer to surface than we expected, which means we can test it with [quicker and cheaper] RC drilling.
“And that’s exactly what we are going to do, starting in September.”
A two rig, 12,000m RC drilling campaign will now comprehensively test the 8km by 4km North Dovers IOCG anomaly.
“This will be a company changer – in fact, it will change the dynamics of the entire region,” Schaus says.
Bulgera: near-term gold production and blue-sky upside
Historic mining at Norwest’s newly acquired Bulgera gold project, totalling 23,400oz from four open pits, barely scratched the surface.
And it is also a stone’s throw from the Tier 1 +5moz Plutonic operation and right next door to Vango Mining’s (ASX:VAN) Marymia mining centre, one of Australia’s most significant pre-development high-grade gold projects.
The flagship 410,000oz Trident deposit at Marymia boasts exceptional grades above 8 grams per tonne (g/t).
Norwest bought this advanced development opportunity for the equivalent cost of a used Porsche 911, Schaus says.
“It’s got to be the deal of the century for a small company like ourselves,” he says.
“Vango have put out three announcements just this month on the high-grade gold intersections that they are getting next door.
“We are in a very good neighbourhood.”
And the project also came with a fairly extensive database – most of it was quality, near surface drilling down to about 100m.
It’s so good, in fact, that Norwest is “very close” to putting out a maiden resource within the next two weeks without having drilled a single hole.
Norwest have big plans to get out there and drill in and around the historic pits, Schaus says, but drilling won’t be constrained to these areas.
“Vango are now drilling down to the south into a thick ~40m transported cover; below that cover Vango is hitting gold,” he says.
“We have an equivalent area renowned for having this thick cover which effectively ‘masks’ the mineralised rock.
“We want to drill there as well.
“We think we have a lot of upside in making new discoveries, alongside exploiting the discoveries we already have.”