Classic Minerals’ Kat Gap grows in size, depth and grade
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
It was just five weeks ago that shares in Classic Minerals Ltd (ASX:CLZ) surged 200% on all-time record volumes after the company released assays results from the company’s reverse circulation (RC) drilling program at Kat Gap, part of the group’s Forrestania Gold Project (FGP) in Western Australia.
Assay results released on Tuesday morning show that the results just keep getting better with wide intersections now proven to be increasing in width at depth and deeper drilling yielding higher grades.
These included 9 metres at 21 g/t gold from 123 metres, including one metre grading 125 g/t gold.
One of the widest intersections to date — in what must be remembered is an early stage exploration program — was 13 metres grading 4.9 g/t gold from 33 metres including one metre grading 22 g/t gold, also close to surface.
The open-ended deposit lies within a five kilometre long geochemical gold anomaly that has seen very little drill testing, and management sees the potential for the discovery of a substantial gold deposit within the project area.
Classic is still gaining an understanding of the geology, and it is rare to find projects that consistently produce such stunning grades so early in their life.
Particularly given the value that should be attributed to Classic’s other assets as we outline below, the company’s market capitalisation of $8 million even after the recent doubling in its share price indicates there is scope for substantial upside.
Depth of gold mineralisation doubles
An extremely promising aspect of these latest results is that they have taken the average depth of gold mineralisation from about 55 metres below surface to approximately 100 metres below surface in the area adjacent to the Proterozoic dyke.
From a geological perspective, Kat Gap keeps on growing with the main granite-greenstone contact gold load extending down dip with significant gold mineralisation intersected adjacent to the cross cutting dyke.
It is also worth noting that the project is strategically located approximately 70 kilometres south of Classic’s Forrestania Gold Project (FGP) containing the Lady Magdalene and Lady Ada gold resources.
The FGP contains a Mineral Resource of 5.3 million tonnes at 1.4 g/t for 240,000 ounces of gold, with a Scoping Study indicating both the technical and financial viability of the project.
The map of the broader area and the current post-mining Mineral Resource for Lady Ada, Lady Magdalene and Lady Lila is tabulated below.
Open in all directions with grades increasing at depth
Part of this round of drilling focused on testing down dip projections of recent high-grade intercepts of the newly extended northern zone, and this confirmed that the system remained open in all directions.
Highlighting the potential for resource expansion through deeper drilling, chief executive Dean Goodwin said, “These deeper gold intersections clearly show that Kat Gap has legs with the potential to grow significantly at depth.
“The further down we drill, the wider the gold zones seem to be getting. This is a function of the structural setting. At the contact flat is out, the fault zone opens up wider in the gold lodes for can accordingly.
“I’ve seen this time and time again it Goldfields, and we clearly need to drill more deep holes to follow the system down.
“The high grades and shallow nature of the gold mineralised system on the granite-greenstone contact will enhance the economics of any future open pit mining operation.’’
Part of the next stage of drilling will include some deep diamond holes to collect valuable structural data at depths up to 300 metres below existing drill coverage.
Goodwin’s comments regarding the style of mineralisation and the prospects for high-grade gold at depth are well supported by large producing mines in the region.
Classic to extend known mineralised zone
The next stages for Kat Gap will be to extend the known gold mineralised zone further north and south from the current drilling area.
This would entail testing the northerly extensions for another 300 metres and the southerly extensions over a similar distance.
If successful, that would give the company a combined strike length of one kilometre.
In conjunction with conducting this exploration, Classic will also probe at depth down dip along the entire 400 metres of gold mineralised granite-Greenstone contact delineated to date.
While there are plenty of chapters still to be written in the Kat Gap Project, the continued strong results highlighted today suggest that Classic could be one of the best emerging sub-$10 million market cap plays based on the value of its assets, management’s astute exploration strategy and the quality of the ore in ground that has already been established.
General Information Only
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.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.