Galileo continues its hunt for Fraser Range nickel discovery

By Meagan Evans. Published at Oct 6, 2020, in Mining

Western Australia’s Fraser Range is highly prospective for nickel sulphides — a key battery metal ingredient that’s in increasing demand.

The region holds particular promise and huge exploration potential, having seen less than eight years of mining so far and only two discoveries over its 150km of prospective strike length.

These include Sirius’ 14.4Mt Nova mine and the privately held Creasy Group’s Silver Knight nickel-copper find, as well as the more recent Mawson discovery at Legend Mining’s (ASX: LEG) Rockford project.

Galileo Mining (ASX:GAL) is an active explorer with experienced management and team that’s focussed on making discoveries. It has quality EM targets, a confirmed sulphide discovery, and is actively exploring for further Fraser Range discoveries.

Highly leveraged to a Fraser Range nickel discovery, Galileo’s later stage peers such as Legend Mining are capitalised at more than ten times that of Galileo. A comparison suggests that Galileo remains significantly under appreciated by the market.

Legend Mining saw its stock double immediately after its initial discovery in December 2019 at its Mawson Prospect — just 50km along strike from Galileo. The pair have striking geological similarities and comparable ground in the Fraser Range.

Now 230% higher since the discovery, LEG has a $375 million market cap — a valuation that points to the huge upside potential for Galileo shareholders on news of its own discovery.

Galileo, with a sub-$30 million market cap (and ~$8.7 million cash at June 30), has all the elements required for a significant kind of share price run on drilling success.

While Legend is further ahead of Galileo in its exploration pursuits, a comparison with a much earlier stage Fraser Range explorer also highlights that Galileo is highly leveraged to exploration success.

The earlier stage S2 Resources (ASX: S2R) is a new entrant to the region. Having identified a large strong EM conductor at its Fraser Range exploration licence in August, S2’s share price has run from 11.5¢ to 27.5¢ — a 140% gain since news of the find.

S2 Resources now has a $87 million market capitalisation, compared to Galileo’s $28.6 million.

However, Galileo is much further ahead in its exploration program. It has quality EM targets, a confirmed sulphide discovery, cash in the bank, and is actively exploring for further discoveries.

The company has undertaken a significant amount of ground work over the last 18 months, completing three rounds of AC drilling and on ground EM surveying, which was followed up with its first RC program and diamond drilling.

Fraser Range Nickel Belt

Galileo’s Fraser Range project lies between the Nova mine to the southwest and Legend’s Mawson prospect to the northeast. This is a highly prospective area to be exploring for nickel sulphides and explains why the company have so many targets ahead to test across its two key prospect areas.

Galileo’s Lantern Prospect is 50km along strike from Legend Mining’s Mawson Prospect, while its Delta Blues Prospect is along strike from Legend’s Crean and Worsley Prospects and S2 Resources’ prospect.

Here are the locations of the Fraser Range tenements of Galileo Mining, Legend Mining, S2 Resources, Creasy, IGO Ltd:

Members of the Sirius Resources (S2’s precursor) team that was behind the Nova-Bollinger nickel-copper discovery are also involved with S2 Resources, Legend, and Galileo.

Most notably, Mark Creasy is a shareholder in all three and his Creasy Group owns the Silver Knight deposit. He also made a fortune discovering the Nova nickel deposit (14.4Mt, 2.3% nickel) that was eventually sold by Sirius to IGO Ltd for $1.8 billion.

The Nova deposit, located 80km from Galileo, put the Fraser Range on the map back in 2012. Creasy has since spent years privately accumulating positions in the most attractive parts of the Fraser Range and investing in juniors that he likes.

He is a major shareholder of GAL, having sold ground to GAL from his private company. Creasy’s former colleague, Brad Underwood, is now Galileo’s managing director after spending more than ten years’ in the Fraser Range — much of that alongside Creasy — and played a key role in the Silver Knight nickel-copper-cobalt deposit discovery.

Mr Underwood, a geologist with over 18 years’ experience in exploration, prospecting and mining has been involved in nickel, gold, copper and cobalt discoveries and the development of numerous prospects over a variety of commodities. He has a wide range of skills including the strategic growth and commercialisation of mineral assets at different stages of development.

Exploration at Fraser Range Project

The undercover mineralisation in the Fraser Range means that there are no surface indications such as soil anomalies, or rock outcrop.

Aircore drilling is used to confirm the rock types beneath cover, while electromagnetic (EM) surveys map out conductors at depth that may contain economic nickel deposits and RC and diamond drilling is used to drill test targets from 50 metres beneath surface.

Galileo

Recent RC and diamond drill programs follow the company’s first ever RC drilling at the Lantern Prospect earlier this year that demonstrated disseminated nickel-copper sulphide mineralisation of up to 0.66% nickel and 0.75% copper.

Considering that Lantern South is just one of several promising prospects within the Fraser Range project area, is highly encouraging that at this early stage of exploration Galileo are hitting nickel and copper.

The first diamond drilling program is now complete. Building on the earlier RC drilling, the diamond core drilling was undertaken across three separate areas at Lantern, where each zone showed potential for sulphide mineralisation.

The three diamond drill holes were designed to test an EM conductor, a structural target, and the known disseminated sulphide mineralisation.

The company intersected significant nickel-copper sulphide mineralisation. This substantially advanced the company along the exploration path and provided new insights to build up the exploration model and prepare for the next round of drilling to begin.

Core samples from the diamond drilling program are now at the laboratory with assay results pending.

Disseminated, blebby and banded sulphide mineralisation

MD Brad Underwood explained that this was “a great result for our first diamond drilling program and demonstrates once again the exceptional potential of the area in which we are exploring. Mineral exploration is a process of creating and testing targets and with each round of exploration we develop our knowledge of the ground.

“The Fraser Range discoveries at Nova (Sirius Resources) and at Mawson (Legend Mining) both involved multiple drill programs over an extended period of time.

“Our first diamond drilling program has substantially advanced Galileo along the exploration path and provided new insights to prepare for the next round of drilling to begin.

EM Surveys Underway

Expanded Moving Loop Electro Magnetic (MLEM) surveys are also now underway at Fraser Range aiming to identify new zones of nickel sulphide mineralisation.

The surveys will cover prospective intrusions (named Think Big, Backwood and Green Moon) located along strike from the Lantern area which is the target of current drilling programs. These surveys cover an area of 46km2 — over twice as large as the EM survey completed in 2019.

Upcoming plans

Upcoming work programs planned at the Lantern Prospect include:

  • Assaying of diamond drill core, petrographic examination of rocks, and analyses of sulphide mineralogy including nickel tenors,
  • Integration of diamond drilling data with geological exploration models; and
  • Drill testing of sulphide targets at Lantern South and revised modelled conductor at Lantern East.

Galileo still have further RC and diamond drilling programs planned for the remained of the year. With a pipeline of prospects and a solid cash balance to progress its exploration plans, we expect to see a steady stream of newsflow over the coming months.

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

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S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

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