East Lachlan guides future NSW gold potential

The Cowal gold mine. Image: Evolution Mining.

Nestled between two highly mineralised volcanic belts, the unique geometry of the East Lachlan region in New South Wales continues to prove its world-class attributes.

Within the Junee Narromine and Molong volcanic belts in the East Lachlan region lies a chemical rock sequence with the intrusion of various magmas that create a highly prospective copper-gold mineralisation.

These deposits have proven promise for a range of different gold mineralisation styles, including orogenic, porphyry, skarn and volcanogenic massive sulphide.

While there are similar mineralisation types across northern Australia, Indonesia, Papua New Guinea and the west coasts of North and South America, the East Lachlan is different in age and chemistry, making it globally unique.

Both belts are already home to world-class assets; the Molong belt hosts Newcrest Mining’s Cadia Valley mine and the Junee Narromine belt is home to Evolution Mining’s Cowal gold operation.

Since acquiring Cowal in 2015, Evolution Mining has produced more than 1.1 million ounces, generated more than $600 million in cash flow and extended the mine life by eight years to 2032.

The mine has also continued to evolve, with Evolution committing to an underground project at the site.

Evolution chairman Jake Klein says the unique properties of the East Lachlan region support the move to add an underground component to the Cowal operation.

Simultaneous open pit and underground mining is on the horizon for Cowal as Evolution grows production at the mine, according to Klein.

“The discovery of the 1.4 million-ounce GRE46 and Dalwhinnie underground resource is a key part of our strategy to sustainably grow Cowal’s annual production above 300,000,” Klein tells Australian Mining.

“We’re still in the process of fully understanding how a future underground operation will integrate with the current open pit.

“However, it’s clear the inclusion of higher grade underground ore into the mining schedule has potential, along with the processing plant expansion to 8.7 million tonnes per annum, to lift future annual output.”

The unique makeup of the East Lachlan’s porphyry mineralisation is what makes it possible for Evolution to branch into this innovative style of mining above and below ground, allowing operations to continue while the changeover period takes place.

In addition to giving Evolution an opportunity to mine in new ways, the East Lachlan geology and deep-seated structures provide a fertile environment for new discoveries, even in the more mature areas like Cowal.

Alkane Resources is starting to realise the extent of the potential with the exciting discovery of the Boda prospect, which the company dubbed as “Cadia style results”.

Since acquiring the Boda prospect from Rio Tinto in 1992, Alkane has completed years of geology, geochemistry and geophysical research, leading to the discovery of the Kaiser Boda area that has been the company’s core focus for the past three years.

After drilling approximately 300 metres north of the Kaiser target, Alkane drilled a diamond hole that showed mineralisation occurring deeper and stronger within a pyrite stringer vein.

The company then drilled beneath the original reverse circulation (RC) hole where it identified one of its most exciting discoveries to date last September.

Alkane Resources drilling in the East Lachlan region. Image: Alkane Resources.

Alkane technical director and former managing director Ian Chalmers believes there are potentially more Bodas waiting to be discovered and has high hopes for the next campaign of drilling.

“If you’ve got these sorts of deposits floating around in the region, you know that there’s potential to find more of them,” Chalmers says. “That’s what makes the region so prospective.

“In the Boda area, we’ve got a target zone that’s maybe 10 to 12 kilometres long, where we think there is a chance for more repetitions of a Boda-type mineralisation.”

Alkane has been busy with follow-up drilling over the Christmas and New Year period, with plans for five core holes north and south of the Boda discovery hole.

“We’ve also planned to put another deeper hole under the existing system to take a look and try to understand what the strike extent is,” Chalmers says.

In addition to porphyry models, Alkane is also exploring for orogenic gold prospects at the Tomingley gold project and epithermal gold at Peak Hill.

“It was quite a bit of jigsaw puzzle science and investigation that ultimately led us to drill that hole and that’s led us to the Boda discovery,” Chalmers says.

“We’re a relatively small company, but for us to have the ability to find something with similar prospectivity to Cadia was really important.”

If Boda is the younger sister of Cadia, then Magmatic Resources has high hopes for its Lady Ilse project, which it has described as being a lookalike of Boda.

When Alkane announced the Boda discovery, Magmatic executive chairman David Richardson and explorations manager Steven Oxenberg decided to take a closer look at the company’s four targets in the region.

Looking closer at the nature of the Molong belt and at some of Alkane’s research from the past decade, Magmatic learned the importance of having a prospect set on alkalic intrusive rocks.

After taking a closer look at the targets, seeing the presence of gold, copper, bismuth, tellurium and arsenic, Magmatic recognised the full potential of what was being explored.

“Our team went back to our targets, reinterpreted our geochemistry and found out our four targets were all on these alkalic intrusives,” Richardson explains. “So, we’ve got four targets that look very similar to Boda.”

Learning from the success of Alkane before it, Magmatic is also planning its exploration drilling within its own Lady Ilse prospect, modelled upon how Alkane drilled to unearth the Boda mineralisation.

Like Alkane, when Magmatic drills Lady Ilse, possibly as soon as this month, it intends to drill 100-metre RC holes then a diamond hole beneath, in the hope of finding similar results.

With Australian dollar gold prices in record territory, it is a good time to be a producer or explorer of the precious metal in a promising region like East Lachlan.

Nearby, at Cadia Valley, Newcrest Mining produced a whopping 912,777 ounces of gold in the 2018-19 financial year.

The Cadia operation has become a top producer of the precious metal in Australia and has potential to become even larger if Newcrest’s growth ambitions at the site are any guide.

“Big discoveries like those in the East Lachlan are hard to find, so that will only continue to support a strong gold price. I love the East Lachlan, it’s Tier 1 country in a Tier 1 region and more is out there waiting to be discovered,” Richardson concludes.

This article also appears in the February edition of Australian Mining. 

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