Horizon Minerals Ltd (ASX:HRX) (OTCMKTS:HZNM) is preparing itself for a new gold growth phase as it moves forward with its largest-ever exploration program with up to four drill rigs in operation at its 890 square kilometres 100%-owned tenement package.
The fully-funded program totals over 70,000 metres of planned drilling within a $7 million-plus budget and comprises reserve conversion, resource growth and new discovery drilling.
With the reserve drilling complete, the focus of the 2021 exploration program will turn to new discovery and new resource drilling across the entire portfolio.
In addition to its key gold focus in the Kalgoorlie and Coolgardie regions of WA, it also holds non-core assets including royalties, listed investments and a joint venture in place covering the 1.8 billion tonnes Richmond-Julia Creek Vanadium Project in North Queensland.
It also strengthened its team ahead of the growth phase.
Boorara Gold Project
The Boorara Gold Project, 10 kilometres east of Kalgoorlie-Boulder, saw pit mapping from the trial pits and mine to mill reconciliation data reviewed and incorporated into the geological model during the December quarter.
On completion of the final toll milling campaign in February, all data will be used to compile an updated mineral resource estimate due for completion in March 2021.
The new model will then be used to generate maiden ore reserves for Boorara as part of the consolidated feasibility study due for completion in the June quarter of 2021.
RC and diamond drilling is planned at several high priority targets and will begin in the current quarter.
Binduli Gold Project
At the Binduli gold project, 9 kilometres west of Kalgoorlie–Boulder, further step out RC drilling is underway with results expected later this quarter.
The new data will be used to compile an updated mineral resource estimate for Crake due for release in the current quarter.
Mine optimisation and design studies will then be completed to generate a maiden ore reserve due for completion in the June quarter of 2021.
At Coote prospect, 700 metres to the west, where the geology is similar to Crake and Janet Ivy, drilling focused on expanding the footprint of gold mineralisation.
Final results for the RC drilling have not yet been received.
A maiden mineral resource estimate for Coote is expected in the current quarter.
Teal Gold Project
At the Teal Project area, 12 kilometres northwest of Kalgoorlie, reserve conversion drilling will focus on the oxide and transitional ore (30-70 metres depth) at Jacques Find and Peyes Farm.
Rose Hill Gold Project
The updated resource models of the Rose Hill Gold Project show a reduction in tonnage offset by a 47% increase in grade as the focus of the project moves to underground mining with a higher cut-off grade and more tightly constrained model parameters.
Consistent width and grade starting at surface enables an open pit to be assessed to reach the primary hard rock zone at depth for a potential portal location to enable decline development and underground mining.
New discovery drilling
To ensure a strong pipeline of growth projects to replace reserves over time, a large-scale exploration program has been planned across the entire 890 square kilometres tenement package with over 15 high priority brownfields and greenfields projects to be tested.
A detailed summary of the 2021 new discovery program will be provided early this quarter.
Nimbus Silver-Zinc project
In light of increasing silver and zinc prices, the company continues to review options and has received a number of expressions of interest from third parties in Australia and overseas for the project.
It is conducting a detailed review of all previous work and believes there is significant opportunity to assess a stand-alone silver-zinc concentrate facility in the future in conjunction with the proposed gold plant under evaluation at Boorara.
Toll mining campaigns
At the Boorara gold mine, the final milling campaign treating the remaining high-grade ore and a test parcel of low-grade material is scheduled to commence in mid-January 2021.
On completion, a mine to mill reconciliation will be completed and used to compile an updated mineral resource estimate due for completion in the March quarter 2021
Richmond-Julia Creek Vanadium Project
The company’s strategic development joint-venture with Richmond Vanadium Technology Pty Ltd (RVT) which covers Horizon’s 100% interest in the Richmond Vanadium Project in northwest Queensland has started the second stage expenditure commitment of A$5 million to March 2021, inclusive of a feasibility study.
With the success of the pre-concentration and downstream test-work, work advanced to simulated production tests.
These tests were conducted with semi-industrial scale samples through the entire process flowsheet from samples to final product.
Lilyvale pre-feasibility study
A positive pre-feasibility study (PFS) was released focused on the development of the Lilyvale vanadium deposit in October 2020.
The immediate next steps are to finalise the optionality within the PFS to the next level of study where required in areas such as determining the optimal power supply for the project, along with progressing environmental studies and preparing the documents for government permitting and approvals.
In parallel, discussions shall continue with potential offtake partners in conjunction with assessing the way forward in relation to the project, including financing or assessing other options for maximising shareholder benefit from the project.
Janet Ivy production royalty
Horizon received royalty payments of $89,436 in January 2021 from its $0.50 per tonne mining royalty on ore mined and treated from the mining lease M26/446, west of Kalgoorlie-Boulder in WA.
It expects further royalty payments on a quarterly basis for material scheduled by Norton Gold Fields Ltd to be treated.
Horizon has disposed of its White Range gold project in the Northern Territory to Red Dingo Corporation Pty Ltd and is currently attending to some remediation issues at the site prior to making application for return of environmental bonds held by the Northern Territory Department of Primary Industry and Resources.
Cash at bank
Total cash at bank at December 31, 2020, was A$15.9 million, inclusive of the $4 million working capital facility.
The company also holds investments in ASX-listed companies with a current value of about A$5.4 million.
A number of key finance and technical appointments were made during the period, including the appointment of Julian Tambyrajah as chief financial officer and joint company secretary.
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