Junior explorers predict a new golden age for historic Tennant Creek

Tennant Creek has historically been regarded as one of Australia’s most prospective gold and copper regions.

At its peak during the 1970s, the area, located 1000 km south of Darwin in the Barkly district, produced around 5.5 million ounces of gold.

Unfortunately, mining activity has since slowed to a crawl, with many of the projects abandoned.

However, four junior exploration companies – Excalibur Mining, Emmerson Resources, Adelaide Resources and Westgold Resources – have returned to the area in recent years, aiming to tap into the region’s enormous potential.

"Tennant Creek has a fantastic history of gold mining; it was really founded on it," Excalibur managing director Tim Lagdon told Australian Mining.

These four companies are taking very different approaches for their respective projects.

Excalibur is re-examining two dormant gold mines, Emmerson is applying new survey techniques to the rest of the Tennant Creek mineral field and both Adelaide and Westgold are exploring the nearby Rover mineral field.

According to Westgold managing director Andy Beckwith, most of the deposits in Tennant Creek have featured "exceptionally high-grade ore bodies of gold and copper-gold."

"They were not necessarily huge deposits, but the cash flows they generated were exceptional," he told Australian Mining.

"These results effectively gave Normandy Mining and PEKO their starts."

Pedigree and potential

It was a simple decision for Excalibur to re-examine the PEKO Juno and Nobles Nob mines on the Tennant Creek mineral field.

Before it closed in 1977, Juno had produced more than 800,000 ounces at a grade of 56 grams per tonne.

Nobles Nob produced 1.11 million ounces at 17.3 grams per tonne.

In the words of Andy Beckwith, "It was a beautiful ore body."

According to Excalibur’s Tim Lagdon, Juno was closed when the gold price was only around US$100 per ounce and there was a cut-off grade close to 10 grams per tonne.

"When the mines shutdown, there was demonstrated gold mineralisation left over," he said.

"So we are looking to redefine and expand this mineralisation with a view to opening a new mine.

"We think this approach of revisiting old assets that operated under different conditions than those of today is a low risk way to establish a new gold mine."

The company recently completed a drilling program at Juno targeted at the areas above and around the old mine’s underground workings.

Excalibur will release its new resource statement in the coming months, but Lagdon is confident the deposits will support the development of a mine in the future.

Meanwhile, Emmerson is conducting drilling on the remainder of the Tennant Creek mineral field.

The company secured around 95% of the available tenements in 2005, when the previous holder went into administration.

According to Emmerson managing director Rob Bills, the vast majority of the previous drilling on the site had been quite shallow, with only 7% of the holes deeper than 150 m.

"We have plotted the distribution of the previously discovered deposits and applied that data onto a Zipf Curve," he told Australian Mining.

"Based on that curve, it looks there is probably seven million ounces of gold still undiscovered in the Tennant Creek area.

"That is why we think it is such a fantastic place; the previous exploration has only been half-done."

The company has expanded on the existing data with aerial magnetic surveys and gravity geophysics studies.

"This was the first time there had been a systematic gravity survey over Tennant Creek," Bills said.

"Gravity surveys examine the density of the underground rock and since Tennant Creek gold tends to be in dense rock, this has been very helpful."

The project has also attracted the attention of large explorer Ivanhoe Resources, which entered into a $28 million joint venture with Emmerson in August last year.

"We expect that there is a lot of tier one copper-gold deposits yet to be found in the area," Bills said.

"It is only a matter of time."

Roving new fields

PEKO first explored the Rover mineral field, around 100 km south-west of Tennant Creek, in the 1970s.

According to Adelaide managing director Chris Drown, those initial studies indicated that the geological characteristics were practically identical to those of Tennant Creek.

"PEKO worked on the area on-and-off for about ten years, discovering a number of Tennant Creek-type systems," he told Australian Mining.

"However, there was not an extensive amount of exploration, because most of the material was buried under between 100 and 200 m of sedimentary cover; surface prospecting is not possible.

"We believe the area has the same potential as the Tennant Creek district, but the exploration is really still in its infancy."

PEKO ceased its exploration activities and vacated the area in the 1980s and for two decades, no other companies stepped in the fill the void.

"However, many knew that Rover Field was another Tennant Creek in the making," Westgold’s Andy Beckwith said.

With this in mind, Adelaide and Westgold set about acquiring tenement areas in the field from 2005.

Adelaide currently holds around 290 km2, while Westgold has acquired more than 13,000 km2.

Both companies are now in the early phases of discovery, particularly focusing on an ore body that spans the boundary between their tenements.

"Our drilling over the last two years has taken our total resource over the one million ounce mark," Beckwith said.

"Importantly though, around 70% of that resource comprises exciting high-grade gold and copper zones."

According to Drown, Adelaide’s drill results to date have also met expectations.

"We are seeing intersections of both copper and gold that have the same high-grade character that typifies the Tennant Creek mineral field," he said.

"There are several confirmed Tennant Creek style mineral systems present, together with another 30 to 40 magnetic anomalies in the project area that have not been drilled yet.

"I believe that Rover has the potential to ultimately deliver several copper and gold mines."

Beckwith is similarly bullish about Westgold’s prospects and expects no less than one copper-gold operation.

"We also have other substantial targets with similar geophysical characteristics that have never seen a drill hole," he said.

"So, beyond our first development, an entire ore body is hopefully awaiting us."

A shared destiny

Adelaide’s Chris Drown believes the shared ambitions have forged a strong bond between the four companies.

"I think there is some camaraderie, because we are all of a similar size and have similar goals," he said.

"The common purpose we share is part of the glue."

This relationship has often seen the explorers share air charter costs and use the same drill and surveying contractors.

Excalibur’s Tim Lagdon believes there is also a good natured rivalry between the companies.

"But generally, we do not see ourselves as competitors, because we all have different strategies," he said.

According to Emmerson’s Rob Bills, if one or more of the companies do indeed get a mine up and running, it could rejuvenate the entire Barkly district.

"The future of the region is all very dependent on discovery success," he said.

"I think it could revitalise the whole economy in Tennant Creek, because there are not many alternative industries out there.

"The area was once a really proud mining district, but it has really fallen into a slump.

"So the biggest impact any of us could have would be to find some gold."

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