A sustained gold price, a weakening Australian dollar and good, experienced people are on the wish list of
In an interview with Gold Mining Journal, Thundelarra Chairman Phil Crabb and exploration director Brian Richardson explained the reasons behind developing the new float,
“We’ve concentrated all our efforts over the past four years on our East Kimberley nickel-platinum group metals projects [in Australia], and we’ve never had the resources to do anything with our gold assets, which are fairly extensive,” says Crabb. “This is an opportunity to get some value for the shareholders from these assets. We thought we’d spin them off, raise some money and really explore them as they should be explored. We want Thundelarra to be known as a nickel explorer and, next year, as a producer.”
He said work on nickel projects was flat-out, which left little time to attend to the company’s gold targets.
Part of the plan for the wholly owned subsidiary is to raise $5 million and float United Gold on the Australian Stock Exchange.
“We had this massive land holding of almost 3,000 square kilometres in the Kimberleys, which we had to attend to,” adds Crabb. “It amounts to close to 1,000 square kilometres in gold claims. We decided we had to focus intensely on the nickel, and this strategy has paid off for us. But that does not mean to say we don’t put any value on the gold.”
He says spinning off United Gold gives Thundelarra an opportunity to explore its gold projects intensively, and that these amount to about 150,000 oz. in resources.
In the United Gold stable will be the southern Murchison properties of Rothsay, Fields Find, Warriedar and Tallering, as well as Davyhurst (Eastern Goldfields), Prairie Downs (East Pilbara) and Water Tank (Norseman).
First up for further exploration and development will be Rothsay and Water Tank.
Says Richardson: “Our main project at Rothsay has potential for a lot more. We’ve tried various avenues to get others to mine it; now we’ve decided to do it ourselves.
“Today there’s an inferred resource of about 100,000 oz. The grade is about 11 grams gold per tonne, and we’re looking at increasing that. At Rothsay, it will take maybe a year to get a reserve.”
Electromagnetic work at Rothsay suggests something prominent along strike to the north, fuelling hopes there might be potential for an open cut underground in the highly mineralized area.
“What’s been frustrating, from an exploration point of view, is that although we’ve had these great gold projects and found new targets, we haven’t had the resources to do anything with them,” Richardson commented. “After we found the new discovery under cover at Water Tank, near Norseman, I drilled only three lines of about thirteen reverse-circulation holes, and we should have drilled more. You’ve got to have a focus. It’s not a matter of simply employing more people; you’ve got to get the right people, and that’s not that easy.”
The spinoff will enable Thundelarra to focus its cash and expertise on the East Kimberley nickel assets, which are jointly held with
Crabb says that compared with many other recent floats, United Gold will have a “quality package of advanced projects.”
Good infrastructure exists near both Rothsay and Water Tank, with plenty of plant availability nearby.
“The new company will also keep its eye out for other gold prospects which might be available,” says Crabb. “It will give us a new focus and direction, and we’re going to bring on experienced gold people as chairman and chief executive. We are actively canvassing for top guys to come and run the company. The board of Thundelarra will make the selection, and Blakiston & Crabb will do the prospectus; all the geological and tenement work is up to date, and we’ve got native title clearance. So it’s pretty much ready to go.”
Crabb is bullish on the gold price: “We strongly suspect gold is going to remain at a fairly good price for some time. I don’t think it will go much higher or much lower, but what I do see happening is that the Australian dollar will ultimately weaken against the other currencies. But that might not be for another twelve months.”
— The author is a staff reporter with Gold Mining Journal in Perth, Australia. This report originally appeared in that publication.
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