The Transfind Extended Gold Project is a small package of 4 prospecting licenses located approximately 70 km east of the city of Kalgoorlie in Western Australia. Southern Gold has put in place an agreement with two prospectors to acquire the tenements if exploration results are positive and the project moves towards production. As part of this deal Southern Gold has committed to complete 2000m of diamond or reverse circulation drilling over the next few years.
The prospectors have been active on the site and recovering very coarse gold in quartz as mineral specimens suitable for sale. The area also saw modest open pit mining in the early 2000’s and at Transfind itself 31,000t of ore was extracted at an average grade of 4.9g/t, or about 5,000 ounces of gold.
What has attracted Southern to the Transfind area?
- Gold grades are high;
- Visible gold has been evident in samples taken at or near surface;
- Historical mining nearby proves the potential for small open pits;
- The area is not far from several mills in the district; and
- There is the longer term potential for a larger system to be discovered, perhaps exploitable by underground methods.
Southern Gold has commenced work on the area and started reconnaissance mapping and rock chip sampling. Recent results from this work saw 12 out of 17 samples return more than 1g/t gold and 5 samples returned more than 8g/t gold with a peak result of 50g/t.
Further baseline geological studies, including auger soil sampling, will be completed before a modest drilling programme to test for extensions to the Transfind pit to the south. There are also several parallel mineralised trends that are currently untested.
Southern Gold paid the prospectors $50,000 cash to secure a 2 year option to purchase the prospecting licenses. The option period runs until 31 January 2019. Southern Gold is to complete 2,000m of reverse circulation or diamond drilling in this time and maintain the tenements in good standing. Should Southern Gold elect to exercise its option it must:
- Pay $200,000 cash to the prospectors;
- Execute a royalty agreement with the prospectors for a $1.80/t of one royalty on all production from the tenements.