CHN (ASX) Ann: Tier-1 Scale Maiden Mineral Resource at Julimar

Originally posted by Iryna-Bella ↑

Chalice Mining

CHN

November 10, 2021 FAT-MIN-792
Speculative

H
CHN Snapshot

The Falcon is coming together

Details of the Falcon Metals (Falcon) demerger are now available, with the release of the prospectus and requisite shareholder meeting now scheduled. The demerger will see Falcon take ownership of Pyramid Hill and the Viking and Mt Jackson gold projects. Concurrently with the demerger, Chalice is offering its shareholders the opportunity to participate in a priority offer of shares in Falcon. The following image shows the location of Falcon’s assets:

Source: Chalice
The shareholder meeting to approve the demerger has been scheduled for 3 December 2021, with the submission of proxy forms due by 1 December 2021. We recommend Members eligible to participate at this meeting, do so by voting in the affirmative to the in-specie distribution of Falcon Metals shares. The notice of meeting, proxy forms and instructions on how to vote are available electronically and can be found on Chalice’s website and can be found here.
On the demerger, Chalice will offer its shareholders, an in-specie distribution of one (1) Falcon share for every 3.025 Chalice shares, with this ratio still an approximation. The demerger remains subject to shareholder approval, but we expect it will be forthcoming. To participate in the demerger, Members must own Chalice shares on 9 December 2021.
Falcon shareholder statements, for share received through the in-specie distribution will be issued on 15 December 2021. Falcon shares are expected to list on the Australian Stock Exchange (ASX) on 22 December 2021 under the likely code FAL.
Concurrently with the demerger of Falcon, Chalice is offering its shareholders the opportunity to participate in a priority offer of shares in Falcon, to raise a minimum A$15 million to A$30 million. The Prospectus covering the priority offer has been lodged with the Australian Securities and Investment Commission on 3 November 2021. A copy of the Prospectus is available on the Facon website and can be accessed here.
The priority offer price has been set at A50 cents per share and to be eligible to participate, Members must have held Chalice shares on 9 November 2021. Chalice shareholders can apply for one (1) priority share for every approximate 5.882 Chalice shares held.
We recommend Members eligible to participate in the priority shareholder offer of Falcon shares do so. We will provide a review of Falcon Metals at a time closer to its expected listing on the ASX.
We are pleased with Chalice bringing its gold assets out from under the recent shadow of success it is enjoying at Julimar. We believe and have written on many occasions that Julimar is a company changer for Chalice. Falcon will, we believe, bring out the full value of the gold assets now locked in Chalice.Afterall, we were reporting on Pyramid Hill prior to the arrival of Julimar in the portfolio.
Pyramid Hill is the most advanced of the three projects that Falcon will own. The Pyramid Hill project is circa 5,000 kilometres of tenements in the prolific Bendigo zone of in Victoria. The Pyramid Hill tenements host an approximate four kilometre long gold trend with three gold bearing diorite intrusions. The following image shows the region of the Pyramid Hill tenements on a geological setting and walk up prospects of interest (Au – gold, g/t – grams per tonne):

Source: Chalice
As Members can see from the above image, there are four walk up targets across the Pyramid Hill project ground, with Karri the most advanced. Karri covers some four kilometres of strike, with a maximum assay read of 32.1g/t gold. Members can see from the results in the above image, the success Chalice has enjoyed at Karri with the high assay read returning five metres graded at 14.0g/t gold from 100.9 metres and included an enriched zone of 2.2 metres graded at 32.1g/t gold. This was an exceptional read and will certainly warrant follow up exploration.
Ironbark and Banksia, as Members can see from the above image also have gold showings that warrant, in our view, follow up exploration, while Wandoo has yet to be fully explored.
Both the Viking (Falcon’s interest 70%) and Mt Jackson projects are less advanced, with Mt Jackson least explored. Shallow reverse circulation drilling at Viking, has intersected gold at three of the four identified prospects. The following image shows the region of the Viking project and the Beaker prospects and the results of exploration to date (Au – gold, ppm – parts per million):

Source: Chalice
Members can see from the above image that three of the Beaker prospects already have gold readings. Falcon is planning to drill at its Beaker prospects in the March quarter 2022, with the aim of targeting the deeper ground beneath the known mineralised envelope.
Mt Jackson is the least advanced of Falcon’s assets, with surface exploration identifying surface gold and pathfinder geochemical responses. Exploration, including a maiden air core drill programme will target coincidental gold-arsenic-antimony soil anomalies along an approximate five kilometre long aeromagnetic anomaly, interpreted to be mafic/ultramafic due to its elevated chrome response. In short, the ingredients are there that can host gold.We look forward to the maiden drill campaign.
We believe Pyramid Hill, in its own right, can carry the value ascribed to Falcon as it demerges from Chalice. The only reason work to date has not been frenetic across Pyramid Hill, is the Julimar project is a game changer for Chalice, and this is where the frenetic exploration has been focussed since the project was stacked in early 2018.
On the frenetic pace and the Julimar project, Chalice released a maiden mineral resource estimate for its Gonneville deposit and as we expected, the numbers were substantial. The following image shows the mineralised envelope at Gonneville that now hosts a maiden mineral resource: (PGE – platinum group elements, Pd – palladium, Pt – platinum, Ni – nickel, Cu – copper, Co – cobalt, NiEq – nickel equivalent, PdEq – palladium equivalent)

Source: Chalice
Gonneville now hosts a new tier–1 maiden resource, after some 520 holes totalling 137,000 metres of drilling were conducted, from the first assay read that returned 25 metres graded at 8.5g/t palladium, 0.9g/t platinum, 0.1g/t gold, 2.0% nickel, 0.9& copper and 0.11% cobalt from 46 metres. The reason for the frenetic pace from initial discovery to the maiden resource is now clear.
Now to the numbers, the resource is 330 million tonnes of ore graded at 0.58% nickel for 1.9 million nickel equivalent tonnes, for contained palladium, platinum and gold of 10 million ounces, nickel of 530,000 tonnes, copper of 330,000 tonnes and cobalt of 53,000 tonnes. The resource is the largest nickel sulphide discovery, globally, since 2000 and the largest PGE discovery in Australia. We expect the maiden numbers will be but the tip of the iceberg, with upgrades to come as further drilling at Gonneville is planned.As Members can see from the above image, the mineralised envelope has yet to be closed off in all directions except up, as it occurs from the surface, and this delivers more blue-sky potential. Drilling will be ongoing well into 2022.
[IMG=707,488]https://members.fatprophets.com/wp-content/uploads/2021/11/MIN792-CHN-D.png[/IMG]
Chalice is well cashed up with some A$86 million in liquid assets. As of 30 September 2021, it held a cash hoard of A$81.3 million and A$5.1 million in listed investments. We have no concern over liquidity.
In passing, Falcon will also be well cashed up as a stand-alone company, as it is currently raising A$15.0 million to A$30 million in a priority offer initial public offering to have cash in hand to explore. A formula tried and true for Chalice and Falcon has fertile ground to complete the formula for success.
[IMG=707,488]https://members.fatprophets.com/wp-content/uploads/2021/11/MIN792-CHN-M.png[/IMG]
We have always considered Julimar was a game changer for Chalice and will stay so, as the story continues to unfold. The resource announcement for Gonneville has reinforced our view. Falcon will come out of this exploration mantra with the same mantra, so even if Pyramid Hill is half as successfully as Julimar has been for Chalice, the rewards could be significant.

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Anyone else slightly mistifed as to why the In Speccie Distribution is closed to non resident Chn holders?
As such, its a demerger of Chn assets held by existing shareholders, so I'm at a loss as to why non resident financial instos should be granted access to the Priority Offer and any Shortfall Offer but not us plebs who happen to reside in other jurisdictions?

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Ann: Tier-1 Scale Maiden Mineral Resource at Julimar, page-312

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Ann: Tier-1 Scale Maiden Mineral Resource at Julimar, page-312

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