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Strong news flow from two projects to potentially drive Argent higher


Published 31-MAR-2017 12:43 P.M.


3 minute read

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In providing a shareholder update on Friday morning, Argent Minerals’ (ASX:ARD) Chief Executive David Busch highlighted two key upcoming developments that have the potential to provide share price momentum. These relate to its Kempfield polymetallic operations where a resource upgrade is imminent and the West Wyalong porphyry copper-gold project.

It should be noted that any catalysts are speculative at this stage and should not be taken as guaranteed and that share trading patterns should not be used as the basis for an investment as they may or may not be replicated. Those considering this stock should seek independent financial advice.

By way of background, the Kempfield project is located in New South Wales and a mineral resource of 21.8 million tonnes and 52 million ounces of silver equivalent contained metal was reported on May 2014 based on 495 drill holes.

Drilling has intersected combined lead/zinc grades of up to 17.9% immediately to the west of the existing mineral resource, and numerous high grade gold intervals including a spectacular gold intersection of 1 metre grading 1065 grams per tonne was identified at one particular drill hole.

Drilling to early 2017 has extended the potential deposit dimensions to approximately 200 metres in depth and one kilometre north-east and 800 metres south.

The Kempfield deposit is not fully defined with potentially significant additional tonnage to be added by further drilling. Management expects the planned resource update to incorporate potential lateral and depth extensions identified by recent drilling, which could nearly double the size of the existing deposit dimensions.

It could be argued that the value of this asset even prior to the resource upgrade isn’t captured in ARD’s share price given the value per resource ounce comparable to peers is circa 29 cents per ounce silver equivalent relative to the company’s closing share price on Thursday, March 30.

West Wyalong project located in prolific copper-gold region

The West Wyalong project also offers exploration upside, and ARD’s interest in the asset will increased to 70% on completion of the current drilling program. It is located in a highly prospective area of New South Wales with high profile adjacent projects being operated by Newcrest Mining, Mitsubishi-Clancy joint-venture, Sandfire Resources, Evolution Mining and St Barbara.

In fact it is only 37 kilometres from the Lake Cowal mine which was purchased by Evolution Mining for US$550 million.

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ARD has a well-funded drilling program which is being supported by a $200,000 New South Wales government grant based on prospectivity, technical and financial assessment. On that note, ARD has been well supported across three projects with New South Wales government cooperative drilling funding totalling $750,000.

ARD is focusing on the Theia and Narragudgil targets at West Wyalong. The six-hole 2.3 kilometre diamond drilling program is expected to be completed by May 2017.

Management’s analysis of the geophysics indicates that the Theia target is a potentially significant porphyry copper-gold system with a strike length of up to 1.8 kilometres in the north-south direction.

As indicated below, the Narragudgil target appears to be an epithermal gold offshoot related to the Theia system.

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