Sandfire injects further funds into Red Mountain project
White Rock Minerals Ltd (ASX:WRM) informed the market on Tuesday that in conjunction with its joint venture partner Sandfire Resources NL (ASX:SFR) an additional US$1.5 million had been committed by Sandfire to extend the current on-ground exploration activities into September at White Rock’s Red Mountain Project.
White Rock entered into an Earn-In and Joint Venture Option Agreement with Sandfire in March for the exploration and development of Red Mountain with a four stage funding package, including an option to spend a minimum of $20 million over that period to earn 51%, with a minimum contribution of $6 million in 2019.
This represented a substantial commitment by Sandfire, suggesting additional investment by the group is an acknowledgement of the quality of the project, perhaps more specifically its read on what appear to be positive early stage exploration results in 2019.
A high-grade zinc and precious metals VMS project in central Alaska, Red Mountain already has two high grade deposits, with an Inferred Mineral Resource of 9.1 million tonnes at 12.9% equivalent, for 1.1 million tonnes of contained zinc equivalent.
2019 exploration budget to exceed $8 million
White Rock is the manager of this year’s program, and management said that the additional US$1.5 million expands the total 2019 budget committed to exploration at Red Mountain to in excess of $8 million.
Funds will be allocated to extend drilling by a further five weeks to allow a number of new high priority targets to be drill tested.
Drilling is focused on testing new targets defined from the ongoing field activities that include geological reconnaissance, surface geochemistry and modelling of the recent 2019 airborne electromagnetic (EM) survey.
The increased funding will also facilitate additional geological reconnaissance, surface geochemical sampling and ground electrical geophysics surveys across the 475 square kilometre strategic land package, identifying new priority targets for drill testing in 2019 and subsequent field seasons.
This should allow follow-up modelling and interpretation of airborne EM targets to assist in drill hole targeting and the continued use of down hole EM surveys.
Highlighting the significance of the additional funding, White Rock’s managing director, Matthew Gill said, “The additional US$1.5 million committed by Sandfire, over and above the $6 million already committed for the 2019 field season, is a strong endorsement of the quality and potential of the strategic land holding we have and the targets being generated for drill testing.”