The Project is located on exploration licence E52/3531 which is contiguous to Capricorn’s existing KGP tenure and is less than 10 kilometres from the processing facility and Bibra open pit
Capricorn Metals to acquire Mumbakine well project. (Credit: swm/Freeimages)
The board of Capricorn Metals Ltd (“Capricorn” or “the Company”) is pleased to advise that it has entered into an agreement with Gascoyne Resources Ltd (“Gascoyne”) to acquire the prospective Mumbakine Well Project (“the Project”) located contiguous to the Company’s Karlawinda Gold Project (“KGP”) tenure in the Pilbara region of Western Australia.
Capricorn will pay Gascoyne $1.25 million upon completion of the transfer of the exploration licence and grant a 0.5% net smelter royalty on all gold produced from the Project. In addition, the Company has agreed to make contingent deferred payments as follows:
- $1.5 million upon the announcement by Capricorn of a JORC compliant Mineral Resource Estimate in excess of 200,000 ounces of gold on the Project (representing a minimum of 6.55 million tonnes at a minimum grade of 0.95g/t Au); and
- $2.0 million upon the announcement by Capricorn of a board decision to commence commercial mining activities on the Project
In the event that Capricorn announces to the ASX a decision to commence mining activities prior to the definition of a JORC code compliant Mineral Resource Estimate meeting the criteria referenced above, Capricorn must pay both contingent deferred payments.
All amounts are payable in cash or Capricorn shares valued at a 20-day VWAP prior to either completion occurring or the release of the ASX announcement. The choice of payment method is at Capricorn’s election with completion of the acquisition conditional upon customary conditions precedent (including any required third party consents). Completion is expected to occur by the end of June 2022.
The Project is located on exploration licence E52/3531 which is contiguous to Capricorn’s existing KGP tenure and is less than 10 kilometres from the processing facility and Bibra open pit. The Project covers approximately 361 square kilometres and lies adjacent to the KGP access road to the Great Northern Highway.
The Project area is located on the southern margin of the Sylvania Dome, an inlier of Archean granitoid – greenstone terrain on the southern edge of the Hamersley Basin. Along the margin of the dome a sequence of meta/basaltic and meta/sedimentary rocks interpreted to be 2700 Ma Fortescue Group has been faulted against the granitoids.
The main focus of historic exploration has been the Central Prospect which straddles 3 kilometres of thrust contact between the granitoids and volcanic/sedimentary rocks of the Fortescue Group. This sequence comprises (north to south) a sedimentary package of shales with minor coarse-grained arkose, steeply dipping to the south, up to 150 metres thick, overlain by a thick sequence of fine-grained mafic volcanics before disappearing undercover. The Central Prospect lies on a gravity high.
There is some evidence of shearing directly adjacent to the granite/sediment contact in the form of quartz stockworks and isolated narrow quartz veins. The stockwork and vein systems are both mineralised. There is also strong shearing along the sediment/mafic contact within the Fortescue sequence. The mylonised shear is 150 metres long by 20 metres wide and was intersected in drilling up to 90 metres vertical depth. This shear is mineralised with an extensive, strongly anomalous arsenic halo.
Very little exploration work has been completed on the Project, however historical drilling in the 1990’s by Battle Mountain Australia and Compass Resources NL returned encouraging results at the Central Prospect and the Jims Vein Prospect. Drilling consisted of a total of 112 RAB holes for 4,870 metres and 38 RC holes for 2,320 metres testing gold prospectivity identified in soil sampling programmes.
Capricorn Executive Chairman Mark Clark commented:
“The acquisition of the prospective Mumbakine Well Project located only 10 kilometres from the Karlawinda processing plant provides Capricorn with an outstanding opportunity to add satellite resources and ultimately mill feed to the Karlawinda Gold Project.”
Source: Company Press Release