igr article - g&m mag

following is the article on IGR from Gold and min gazette...

Cdchi1

Enthusiasm now reloaded
In less than two years Integra
Mining Ltd has transformed
itself through a mixture of
aggressive acquisitions, targeted
exploration and sound
management.
Part of the transition was a
name change in November last
year from ReLODE Ltd to Integra
Mining Limited, although the
winds of change were blowing
long before then.
In October 2003 the company
exercised an option to purchase
what was then the Karonie gold project,
located 110 kilometres east of
Kalgoorlie-Boulder in Western
Australia, from Equs Ltd.
Soon after this initial acquisition Integra
extended the tenement package to an area
of 340 square km and renamed the project
the Aldiss gold project.
Within the project are the historic Main
Zone pit and Harry’s Hill deposit.
The company then announced a 450,000
ounce resource for the project.
In October 2004 it picked up the historic
Rowes Find and Harry’s Line gold mines,
some 20 km north east of Aldiss, from the
administrators of Deep Yellow Ltd.
Then, in the first half of this year, Integra
really started moving.
In March the junior purchased the
Randalls gold project, some 30 km west of
Aldiss, from Solomon (Australia) Pty Ltd.
Randalls contains four historic mines,
including the incomplete Maxwells pit.
Following on from this in July, Integra
entered into a joint venture agreement
with Avoca Resources Ltd over the
Cowarna project.
The Cowarna JV gave Integra an interest
in a substantial portion of the ground
between the Aldiss and Randalls projects.
The final piece of the Integra puzzle to
date is the option to purchase agreement
the company has executed with Westex
Resources Ltd over the Randall Hill
tenements. Randall Hill adjoins the
western boundary of the Randalls project
and Integra has the option to purchase the
project up until July 2009.
To date — through strategic acquisitions
and partnerships — Integra has
established a position of regional
dominance of about 1,850 square
kilometres of tenure within the Randalls-
Aldiss project area.
While this regional consolidation was
occurring, the company was aggressively
exploring with extensive campaigns of RC
drilling totalling close to 12,000 metres in
the last financial year, enabling it to
increase its resource base substantially.
To date Integra has established 1.1
million oz of JORC-compliant gold
resources across the Randalls and
Aldiss projects.
Of this figure, more than 80% (or
840,000 oz) are in the indicated
resource category.
Building on a strong ground holding
in a prospective area and a solid
resource base, the junior also has a clear
plan moving forward.
Integra’s managing director Chris
Cairns explains how his company
intends to incorporate four pits into a
regional stand-alone operation.
“We propose having the Main Zone
and Harry’s Hill pits straddling a
processing facility location, with French
Kiss 20 km south and Maxwells being
satellite operations providing highgrade
feed,” Cairns said.
The company is currently conducting
a revised scoping study towards this end
and hopes to have it completed in the
first quarter of next year.
In addition, Integra is drilling
immediate opportunities including
2,000m of RC drilling at the French Kiss
deposit following up on a previous
result of 1m at 92 g/t gold returned in
the last metre of the hole.
Along with French Kiss the company
has a number of high-grade targets
throughout the Aldiss project scheduled
for drilling.
Some of these targets have already
produced a significant quantity of
close-to-surface nuggets hosted in
quartz veining.
“We’re very excited about the next
six months that we’ve got in front of
us,” Cairns said.
“The board has approved a fairly
ambitious exploration program
over the next six months.
“We’re going to be drilling a
number of very exciting targets and
it’s not just drilling off the edges of
things people have found before —
we’re looking at identifying new
zones of mineralisation and giving
ourselves the opportunity to make
some new discoveries.”
Integra has employed the services
of Lithofire Consulting Geologists
to review its exploration data across
the majority of its projects to
produce a big picture view of
opportunities for new
discoveries.
“We’re still valued in the
vicinity of $10 per resource
ounce,” Cairns said, “which
compares with an average of
around $40 for similar junior
companies.”
“Eighty per cent of our
resources are in the indicated
category so it’s a high quality
asset. Those oz are not going to
go away, we’re undervalued
relative to the asset and that’s not taking
into account any valuation for the upside,
possible production cash flow and the
initiatives that we’ve recently announced.”
One of the reasons for the market’s
reluctance to ascribe greater value to
Integra’s position could be attributed to a
myth in sections of the industry that the
Karonie ore body at Aldiss was too hard
and difficult to process.
“When Freeport constructed a mine out
at Karonie Main Zone in 1988 they put in
an oxide mill and the processing
contractors felt they could over-rate the
specified crushing capacity by 20% as had
been their experience elsewhere in the
goldfields on oxide deposits,” Cairns said.
“When Freeport started putting through
the Karonie ore — which is pretty much
fresh ore at surface — the mill struggled to
meet its designed throughput rate.”
Cairns said the problems Freeport faced
could have been overcome by using a
front-end crushing circuit more suited to
the material being processed.
“While the ore is hard it is no harder than
other operations in the Goldfields that
have successfully produced at a handsome
profit like, for example, LionOre’s
Thunderbox project,” he said.
“Thunderbox, in terms of resource
grade, is half a gram shy of the grade
at Aldiss.”
Cairns also drew the analogy of Integra’s
holdings in the Karonie greenstone belt
with the Yandal Belt 20 years ago.