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TMR announces potential new “Layer of Icing in the cake”


Published 16-AUG-2022 09:00 A.M.


7 minute read

Disclosure: S3 Consortium Pty Ltd (the Company) and Associated Entities own 3,432,000 TMR at the time of publishing this article. The Company has been engaged by TMR to share our commentary on the progress of our Investment in TMR over time.

It happened again.

Our junior gold exploration Investment Tempus Resources’ (ASX:TMR) has hit multiple sections of visible gold with its first drill holes at a previously mapped (but unexplored) vein.

This time they intersected zones of quartz veining that are up to 25m in width.

Now we await the all important assay results to find out the gold grade...

TMR is currently working to prove out enough gold to restart its existing gold mill in Canada - which could quickly turn them into a gold producer.

Last week we shared our tracking document to show the ongoing progress of TMR’s drilling program to date using an analogy of new gold veins being like layers of icing in a cake:

We have since added slides 17, 18 and 19, which show how yesterday’s result contributes to TMR’s overall goal and what to expect next:

View our updated TMR drill program tracking document


Just last week, TMR came out with some of the biggest gold grades we had ever seen at 523g/t of gold over 0.42m, which saw TMR’s share price break out of its downward trend, gaining 47% in a day on record volumes.

That result came after multiple visible gold intercepts that TMR made early in its 2022 drilling program.

Yesterday TMR followed that up, announcing multiple visible gold intercepts to the northwest of the new Blue Vein, on the historically mapped (but lightly explored) “No.9 Vein”.

TMR confirmed that the visible gold in the No.9 Vein is coming up in quartz veining with thickness of up to 25m.

While last week’s 523g/t for 0.4m headline was great, yesterday’s result is over a much larger 25m intercept.

TMR is looking for gold inside the quartz veins. Given the intercept measured 25m in thickness, it could mean that there is gold mineralisation over that entire width.

Of course, assays will verify this theory. But as a starting point, at this stage the intercept looks promising to us.

Last week we also detailed TMR’s 2022 drill plan, and the four key objectives to help prove enough gold to restart its existing gold mill.

We listed those four objectives of the drill program (on 9 August) in our slide deck, as follows:

  1. Test to find a gold vein to the west of the Blue Vein.
  2. Test for extensions along strike and down dip at the Blue Vein.
  3. Test if the West Vein or Main Vein extend south.
  4. Test the Ella Vein.

Yesterday’s announcement is a tick for #1: “find a gold vein to the west of the new Blue Vein” (shown in blue):

New Cake Layer

The “No. 9 Vein” sits ~120m northwest of the Blue Vein. There had been some small scale exploration in the 1940s and 1950s on the No. 9 Vein, but it is a vein that TMR had NEVER drilled before.

Yesterday’s news is unexpected and comes from the riskier exploration drilling that TMR is doing, chasing entirely NEW vein discoveries.

TMR appears to be quite excited about this new result at Vein No.9, announcing that they are committing to 5 more holes at this vein in the current drill program.

With assay results pending and visible gold found in the drillcores, we won't have to wait too long to find out if TMR has discovered a potentially economic gold vein.

How we are visualising what TMR has on its hands

We think the best way to visualise what TMR is drilling for is to think of its gold project as a slice of layered cake.

The gold veins TMR is looking to discover/extend are the layers of icing in the cake:


TMR’s project has previously produced gold out of only one layer of icing (SW Vein).

In fact, the SW Vein contributed to ~230,000 ounces of gold production in the past.

TMR is now trying to replicate the success the project had with that layer, by adding new layers of icing (veins) to its cake (gold project), with a view of getting it back into production.

The ultimate target is to find as many layers of icing as possible and to work out how big (and full of gold) they are before putting them into production through TMR’s existing processing mill.

Yesterday’s announcement may be the precursor for a whole new layer of icing (vein) being uncovered. Below is how it would look in cake form:

cake layer 2

It's just under a year since TMR accidentally made the Blue Vein discovery (whilst trying to extend its already well understood SW Vein), and TMR may be about to add to this with an entirely new hit at the No.9 Vein.

Today we are re-sharing a document that we use to track the progress of TMR’s drilling over time.

The document focuses on the Blue Vein discovery made last year and has been updated with yesterday’s news:

Click on the image below OR here to see our TMR progress tracking document:


What’s next for TMR?

30 hole (8,500m) drilling program at TMR’s Canadian gold project 🔄

As of yesterday, TMR is ~20 holes into its 30-hole 2022 drilling program.

So far, the drilling has mostly focused on the Blue Vein discovery, with the two most recent drill holes intercepting visible gold at the No.9 Vein.

We previously mentioned we would classify TMR’s 2022 drilling program as a success if it could show that the Blue Vein discovery extends along strike and down dip.

We also mentioned that another sign of success would be TMR making new vein discoveries.

After yesterday’s news, we have two different newsflow items to look forward to.

First are the assays that are looking to extend the Blue Vein along strike and down dip.

Second are the assay results from the No.9 Vein (yesterday’s announcement).

On top of all of this, TMR still has around 10 drillholes to go, so we could still see some surprise results from the remainder of the drilling program.

Below (in green) is TMR’s entire 2022 drilling plan.


Below are the milestones we will be tracking for the drilling program:

✅ Drilling program commencement

🔄 Drilling results (assays)

Ultimately the determinant of success will be whether TMR intercepts high grade gold structures.

Given TMR is targeting thin gold veins, our focus will predominantly be on the grades of mineralisation.

We expect that anything above ~4-5g/t of gold will mean TMR could be onto something commercially mineable.

What are the risks?

With assays pending, the obvious risk for TMR right now is “exploration risk”.

Whilst visible gold intercepts are a positive first sign that there may be gold where TMR is drilling, ultimately, if the assays don't return high enough grades or the intercepts are too thin, the project may still be considered uneconomic to redevelop.

This is why we highlighted exploration risk in our 2022 TMR Investment Memo. To see all of the key risks in detail, click on the image below.


Financing Risk:

TMR recently raised $1.05M via a placement at 5c per share.

This adds to the company’s existing cash balance of ~$1.1M (at 30 June 2022), meaning the company should have around $2.15M in cash to finance the rest of its 2022 drilling program.

At the same time, TMR announced a partially underwritten (by non-executive chairman Alexander Molyneux) entitlement offer open to existing shareholders to raise a further $3.9M on the same terms as the placement.

This gives current TMR shareholders the opportunity to purchase more shares off market at the same price as the private investors who got the placement at 5c per share (along with the free attaching options).

With the share price now trading trading above 8c per share, the 5.0c entitlement offer allows existing shareholders to top up their shareholdings at a discount to the current market price.

The key dates for the entitlement offer are:

  • Offer closing date 29 August 2022 - Last day to accept entitlement.
  • Offer issue date 5 September 2022 - This is when the entitlement offer shares are expected to be issued.

We intend to take up our full entitlement.

If TMR raises the full $3.9M, the company will significantly reduce the financing risk for this year's drilling program.

2022 TMR Investment Memo

Below is our 2022 Investment Memo for TMR where you can find a short, high level summary of our reasons for investing.

The ultimate purpose of the memo is to record our current thinking in order to benchmark the company's performance against 12 months from now.

In our TMR Investment Memo, you’ll find:

  • Key objectives we want to see TMR achieve in 2022
  • Why we invested in TMR
  • What the key risks to our investment thesis are
  • Our investment plan

Disclosure: S3 Consortium Pty Ltd (the Company) and Associated Entities own 3,432,000 TMR at the time of publishing this article. The Company has been engaged by TMR to share our commentary on the progress of our Investment in TMR over time.

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S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

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