There is so much capital market excitement and support for battery minerals exploration that news this week of the latest round of drilling co-funding from the Western Australian Government caused barely a ripple.
Round 26 of the Government’s Exploration Incentive Scheme resulted in $6.7 million being dished out to 38 projects.
Not surprisingly, more than half of the successful EIS applicants are chasing battery minerals, led by nickel while rare earths – one of the great oxymorons given they are not that rare in WA – is also proving popular.
Companies receiving EIS funds – all chasing greenfields success – are focusing increasingly on remote parts of north-eastern WA heading towards the border with the Northern Territory.
The battery minerals theme is an easy narrative for the Government to spruik when it comes to awarding taxpayer funds to exploration companies.
“The search for battery minerals is fundamental to the world’s clean energy transition; the McGowan Government will continue to grow and diversify our resources sector to meet the growing demand for renewables,” Mines and Petroleum Minister Bill Johnston said.
According to Government figures, exploration expenditure in WA totalled $2.5 billion last financial year. In that context, Round 26 of EIS funding is a drop in the ocean though it ignores the success that has stemmed from the State supporting some far-flung, remote greenfields exploration work.
Over the year, EIS funding has been applied to drilling that led to the discovery of the Nova nickel mine and the world-class Tropicana and Gruyere gold mines.
The reality is that exploration remains hard work. The high rewards on offer – think about Gruyere, now a mine targeting annual low-cost production of 350,000oz for more than a decade; just ask 50 per cent-owner Gold Road Resources (ASX: GOR) – usually only come after a significant expense and dogged pursuit.
The extension of this reality is new ore bodies that are viable for development are even harder to find.
Two of the more active explorers in WA at the moment are Artemis Resources (ASX: ARV) and St George Mining (ASX: SGQ).
Both have highly prospective copper-gold tenements in the Paterson Province – Artemis next door to Newcrest-Greatland Gold’s Havieron project and St George closer to Rio Tinto’s Winu discovery – and are advancing methodical exploration programs.
Artemis’ Paterson Central project is a dial mover though the Alastair Clayton-led explorer is far from a one-trick pony. The junior’s most advanced asset is the Greater Carlow gold-copper-cobalt project, south of Karratha in the Pilbara.
Long ignored, Artemis has spent the past two years reworking models and its understanding of Greater Carlow and working the ground over with the drill bit. A much-hoped for resource upgrade early last year failed to materialise but led Artemis to better understand what it was dealing with at Greater Carlow.
This week, Artemis reported a total Inferred Mineral Resource for Greater Carlow of 8.74 million tonnes at a gold-equivalent grade of 2.5 g/t, comprising an open pit resource of 7.25Mt at 2.4 g/t Au-eq for 557,000oz (using a 0.7 g/t Au-eq cut-off grade) and an underground resource of 1.49Mt at 3.1 g/t Au-eq for 146,000oz (using a 2 g/t Au-eq cut-off grade).
Importantly for this line-in-the-sand resource statement, the high-grade mineralisation remains open in multiple directions and will be the target of further drilling planned by Artemis.
“What we have now established at Greater Carlow is a robust, credible, high-grade multi-metal resource which our exploration team can now seek to continue to grow via drilling,” Alastair Clayton told shareholders.
“The next phase at Greater Carlow is to drill and add more high-grade tonnes to the open pit and underground resources, including the high-grade Keel Zone which is not included in this resource statement.
“Importantly, this resource has taken into consideration recent industry cost escalation and still returned robust results.
“With a diverse potential product stream of gold and the key battery metals of copper and cobalt, we believe the Greater Carlow grade ranks very favourably against other comparable pre-development resource projects in WA.”
There is a growing view in the marketplace that Greater Carlow is one of the few sizeable gold discoveries not only with scale upside but a path to likely development, either through a stand-alone operation or as feedstock for a third-party mill.
For St George, its Paterson Project is a value-add to an exploration asset portfolio that is dominated by Mt Alexander in the Goldfields.
Best known for hosting high-grade nickel-copper-PGE sulphides – St George has already made four shallow discoveries and is achieving breakthroughs at depth – the John Prineas-led explorer this week set the market on fire with first assays results from a rock-chip sampling program to test outcropping pegmatites.
The assay results from the first 10 samples included grades of 1.97 per cent Li2O, 1.15 per cent Li2O, 1.68 per cent Li2O and 2.72 per cent Li2O plus sizeable quantities of lithium tracers caesium, tantalum and rubidium.
The news sent St George’s share price up as much as 40 per cent while more than 15 per cent of its issued share capital changed hands.
St George is preparing a maiden lithium drill program for Mt Alexander to kick off within weeks – in parallel to continuing the hunt for more nickel.