RMX gets more to chew on
Red Mountain Mining (ASX:RMX) has a new drilling target on its hands at its Batangas project in the Philippines.
Although the Batangas project is primarily a gold play, it has found a new silver lead along strike from its existing West Drift resource at Lobo, a key area within the project.
Dubbed the ‘Benito’ target, RMX undertook rock chip sampling and trenching at the new area to get a feel for what was there.
It told its shareholders this morning that the results included 4m @ 70.7 grams per tonne of silver, and 1.5m @227 g/t Ag, with 0.42% copper.
Benito is along strike from the West Drift resource, which is characterised by high silver-copper grades at surface.
However, there is high grade gold at depth.
RMX will undertake further soil sampling at Benito before firming up drill targets.
Meanwhile, the timing of a crucial London listing for chief backed Bluebird Merchant Ventures Limited became clearer.
RMX told its shareholders that listing is now expected to happen in January next year, after the UK listing authority accepted Bluebird’s prospectus document. Subsequently, a key funding arrangement has been pushed back to the end of January to allow time for Bluebird to list.
At this stage the plan is for Bluebird to pay an initial $US1.7 million ($A2.4 million) in two tranches to allow Bluebird to take a 25% stake in Red Mountain Mining Singapore, the company which holds the promising gold project.
Exploration on the project will then be funded on a pro-rata basis, but Bluebird will have the option of bumping its stake up to 50.1% for another $1.7 million before September 30 next year.
However, should Bluebird not take up the extra stake it will still have an opportunity to do so, with Bluebird having to chip in $3.8 million to get the interest.
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The funding is going towards a definitive feasibility study and drilling at the Batangas Gold Project in the Philippines.
Total mineral resources at Batangas sit at 2.97 million tonnes @ 2.4 grams per tonne gold for 227,000 on an indicated basis, and 3.22MT @ 2.1g/t for 218,000oz on an inferred basis.
The Lobo area features 82,000 oz on an indicated and inferred basis – including the South West Breccia mine, which will be the first start-up mine at the project.
Free cash flow from production of the first 100,000oz is expected to be $45 million – which recently got a boost by 50% due to increases in the Australia dollar gold price and a drop in the Philippine oil price.
Capex at this stage is expected to be $15 million, a figure set out in a scoping study and feasibility update, but a definitive feasibility study would add more certainty around the numbers.