Yeah, your points are valid brother, despite the strategic approach it was a bit of a nothing announcement other than increased strike.. Fair call. h8tey,
The poster’s take that the shallow AC results (4m @ 1.03 g/t, 0.57 g/t, 0.23–0.33 g/t, 28m average depth) are consistent with historical RAB drilling is correct—they reflect a gold-depleted regolith, a common feature in the Eastern Goldfields, and add incremental value by extending the New Cross Fault strike by 600m and identifying RC targets. However, their critique of OZM’s strategy is valid: conducting shallow AC drilling when historical data already indicates deeper potential (e.g., RC hits like 48m @ 1.66 g/t, RAB ending in mineralization) delays confirmation of a primary orebody, contributing to the “self-inflicted” SP drop (A$0.083 to A$0.075). OZM’s systematic approach (AC to scout, RC to define) is geologically sound but misaligned with market expectations, as seen in similar post-February 2025 pullbacks. A refined strategy focusing on deeper RC drilling at known intercepts (e.g., near MNORC 215, MNORC 222) could accelerate resource growth, potentially adding 20,000–50,000 oz per program and re-rating the SP.
Historical RC Drilling Overview
Early RC Drilling (Pre-1998):
Context: Limited historical drilling occurred in the Mulgabbie North area, including the New Cross Fault region, prior to OZM’s recent efforts. This aligns with the broader Mulgabbie Goldfield’s history, where exploration was conducted by companies like Western Reefs Limited, Burdekin Resources Limited, and Gutnick Resources from the late 1980s to early 2000s.
Scope and Results:
Western Reefs Limited (1987–1988): Drilled 44 RC holes totaling 2,328m, alongside 150 RAB holes (3,708m). While specific RC intercepts aren’t detailed in the available data, this program likely targeted shallow gold anomalies, establishing early indications of mineralization in the region, including areas near what is now the New Cross Fault.
Gutnick Resources Limited (1999–2000): Drilled 6 RC holes for 1,978m, alongside 82 RAB holes (3,188m). A notable historical RC intercept in the New Cross Fault area, as referenced in OZM’s announcements, includes a vertical RAB hole from 1998 that intersected significant mineralization, though specific RC results from this period are not fully disclosed. This suggests deeper potential that was never followed up until OZM’s recent campaigns.
Geological Context: These early RC holes likely targeted the same sandstone-hosted, fault-controlled gold systems OZM is now exploring, with mineralization associated with quartz veining, pyrite, and arsenopyrite—features consistent with the Eastern Goldfields’ orogenic gold deposits, such as Northern Star’s Carosue Dam (2 km away).
Significance:
The historical RC drilling established the presence of gold mineralization, but its limited scope and lack of follow-up left significant potential untested. The shallow nature of early RAB drilling (e.g., by Gutnick in 1998) often ended in low-tenor gold (0.2–1 g/t), indicative of a gold-depleted regolith, with deeper RC holes hinting at primary mineralization that required further exploration.
Relevance to Current Exploration
Historical RC Insights: The early RC drilling (1987–2000) by Western Reefs and Gutnick identified gold anomalies but lacked follow-up, leaving deeper potential untested. OZM’s 2021–2022 RC campaigns (e.g., 56m @ 1.31 g/t, 14m @ 3.89 g/t) confirmed a significant gold system, culminating in the 260,000 oz MRE (July 2023). The New Cross Fault RC results (2025) further expanded this potential, with high-grade intercepts (e.g., 2m @ 22.58 g/t) and wide zones (e.g., 48m @ 1.66 g/t).
Poster’s Critique: The poster argues that OZM should have prioritized deeper RC drilling at historical intercepts (e.g., near MNORC 215, MNORC 222) rather than shallow AC, as historical RC and RAB data (e.g., 1998 RAB ending in mineralization) already indicate deeper potential. The May 30 AC results (e.g., 4m @ 1.03 g/t, 0.57 g/t) are consistent with historical RAB, reinforcing the poster’s view that shallow drilling adds little new insight and delays confirmation of a primary orebody at depth.
Strategic Implications: Historical RC intercepts (e.g., 56m @ 1.31 g/t, 48m @ 1.66 g/t) suggest a robust primary system, yet OZM’s focus on shallow AC drilling (e.g., May 30 program) has delayed deeper testing. Aligning with the poster’s suggestion, OZM could accelerate resource growth by targeting deeper RC at known intercepts, potentially adding 20,000–50,000 oz per program, as seen in prior RC campaigns.
Reasons OZM Might Justify Their Approach
Despite the poster’s valid critique that OZM’s focus on shallow AC drilling (82 holes, 2,290m, average depth 28m, yielding 4m @ 1.03 g/t, 0.57 g/t, 0.23–0.33 g/t to EOH) delays deeper RC drilling at historical intercepts (e.g., 48m @ 1.66 g/t, 12m @ 4.26 g/t from April 2025), OZM’s strategy can be justified for the following reasons:
1. Systematic Exploration to De-Risk and Optimize Targeting
Rationale: OZM’s approach—using diamond drilling (MNODH 017: 17m @ 1.25 g/t with 2m @ 6.28 g/t, 25m @ 1.24 g/t; MNODH 018: 25m @ 0.76 g/t) and AC to inform RC drilling—follows industry best practices for greenfields exploration. Diamond drilling provides detailed structural and mineralization data (e.g., sheeted veins, breccia, fault associations), while AC drilling extends strike length (600m to ~1,000m) and identifies RC targets (e.g., near MNOAC 843). This systematic method reduces the risk of drilling “dusters” (non-mineralized holes) by ensuring RC programs are well-targeted.
Geological Context: The New Cross Fault’s complexity (e.g., multiple fault orientations, 30m stratigraphic offsets) requires a thorough understanding of structural controls, as gold is fault-associated (e.g., 1m @ 5–6 g/t in diamond holes). OZM’s engagement of structural geologist Dr. Brett Davis underscores this need for precision, especially along the 8 km Relief Shear, where similar north-south faults could host additional deposits.
Historical Relevance: Historical RC drilling (e.g., 56m @ 1.31 g/t in 2022, 48m @ 1.66 g/t in April 2025) confirms deeper potential, but its variability (e.g., 2m @ 22.58 g/t vs. 25m @ 0.76 g/t in MNODH 018) suggests geological complexity. OZM’s approach ensures RC drilling targets the most prospective zones, avoiding costly misses.
2. Cost Management and Capital Preservation
Rationale: As a junior explorer with limited cash reserves (post-March 2025 A$1.75M placement), OZM must manage costs. AC drilling is significantly cheaper (A$10–20/m) than RC (A$50–100/m) or diamond drilling (A$150–300/m). The 2,290m AC program likely cost ~A$23,000–46,000, vs. ~A$114,000–229,000 for an equivalent RC program. By using AC to scout and extend strike, OZM preserves capital for targeted RC drilling, especially critical during a gold boom when assay labs are backlogged (2–6 weeks turnaround).
Financial Context: OZM’s market cap (A$17.2M at A$0.075) and history of placements (e.g., March 2025) indicate capital constraints. Deeper RC drilling at historical intercepts (e.g., near MNORC 215, MNORC 222) without refined targeting risks wasting funds on low-grade or barren zones, particularly if structural controls are misunderstood.
Implication: OZM’s cautious approach balances exploration progress with financial prudence, ensuring funds are available for high-impact RC programs post-AC targeting.
3. Building a District-Scale Model Along the Relief Shear
Rationale: The May 30 statement that diamond drilling insights will be applied along the entire Relief Shear reflects a district-scale vision (1–2 Moz potential, akin to Northern Star’s Carosue Dam, 3.2 Moz). OZM is mapping the 8 km Relief Shear to identify multiple targets, leveraging sandstone-hosted, fault-controlled mineralization (e.g., north-south faults, quartz veining). Shallow AC drilling helps delineate the broader system, ensuring no prospective areas are missed before committing to deeper RC.
Geological Context: The Relief Shear hosts the New Cross Fault (2 km south of the 260,000 oz MRE), with similar structural features (e.g., north-south faults) at Carosue Dam (2 km away). Historical RC (e.g., 56m @ 1.31 g/t in 2022) and RAB (e.g., 1998 Gutnick RAB ending in mineralization) indicate widespread potential, but OZM aims to prioritize targets across the shear, not just at known intercepts.
Implication: This approach supports long-term value creation by building a multi-deposit model, though it delays immediate deep testing, frustrating retail investors expecting rapid high-grade results.
4. Heap Leach Feasibility Focus (Due July/August 2025)
Rationale: The near-surface oxide gold (e.g., MNODH 017: 17m @ 1.25 g/t from surface; MNORC 222: 17m @ 1.65 g/t within 39m @ 1.09 g/t) aligns with OZM’s heap leach feasibility study, aiming for low-cost production (<A$50M capex, >80% recovery). Shallow AC drilling (e.g., 4m @ 0.57 g/t from surface at MNOAC 843) tests for oxide mineralization, supporting this near-term economic goal, while deeper RC drilling is planned post-feasibility to define primary resources.
Economic Context: At A$5,153.41/oz gold, near-surface oxide gold (e.g., 1–2 g/t) is highly economic for heap leaching, potentially generating early cash flow to fund deeper exploration. Historical RC (e.g., 48m @ 1.66 g/t) confirms deeper potential, but OZM prioritizes feasibility to de-risk the project.
Implication: This focus justifies shallow drilling to support feasibility, but the market’s focus on deeper high-grade results (e.g., 2m @ 22.58 g/t) highlights a disconnect in priorities.
5. Mitigating Geological Variability and Risk
Rationale: The New Cross Fault’s variability (e.g., MNODH 017’s sheeted veins with 2m @ 6.28 g/t vs. MNODH 018’s breccia at 25m @ 0.76 g/t) and historical RC data (e.g., 56m @ 1.31 g/t vs. 2m @ 22.58 g/t) suggest a complex system. Shallow AC drilling maps this variability across the 1,000m strike, ensuring RC drilling targets the most prospective zones (e.g., fault intersections, high-grade shoots).
Geological Context: Fault offsets (30m) and multiple vein orientations (north-south, 315°) indicate structural complexity, as noted in the May 30 announcement. Dr. Brett Davis’s involvement aims to refine this understanding, reducing the risk of RC drilling in less prospective areas.
Implication: OZM’s approach mitigates the risk of missing high-grade zones, though it slows the pace of deep testing, contributing to market frustration.
Step 2: Balancing the Critique and Justification
Poster’s Critique: OZM’s focus on shallow AC drilling delays deeper RC at historical intercepts (e.g., 48m @ 1.66 g/t, 17m @ 1.65 g/t in MNORC 222), missing opportunities to define a primary orebody and causing “self-inflicted” SP pain (A$0.075, EV/oz ~A$37/oz).
OZM’s Justification: The systematic approach de-risks exploration, preserves capital, builds a district-scale model, supports heap leach feasibility, and mitigates geological variability, ensuring long-term value creation (1–2 Moz potential).
Middle Ground: OZM’s strategy is geologically sound but misaligned with market expectations. A hybrid approach—continuing AC to map the Relief Shear while accelerating targeted RC at historical intercepts (e.g., near MNORC 215, MNORC 222)—could balance both goals, potentially adding 20,000–50,000 oz per RC program and re-rating the SP
Final Answer
The poster’s critique that OZM’s focus on shallow AC drilling delays deeper RC at historical intercepts (e.g., 48m @ 1.66 g/t, 17m @ 1.65 g/t in MNORC 222) is valid, contributing to the SP drop (A$0.075, EV/oz ~A$37/oz). However, OZM can justify their approach for several reasons:
Systematic De-Risking: Diamond and AC drilling refine targeting, reducing RC risks in a complex system (e.g., fault offsets, dual mineralization styles).
Capital Preservation: AC drilling (A$23,000–46,000) is cheaper than RC (A$114,000–229,000), preserving funds for targeted programs.
District-Scale Vision: Mapping the 8 km Relief Shear supports a 1–2 Moz potential, akin to Carosue Dam (3.2 Moz).
Heap Leach Focus: Shallow drilling supports near-term feasibility (July/August 2025), leveraging oxide gold (e.g., 17m @ 1.25 g/t from surface).
Geological Variability: Understanding structural controls (via Dr. Brett Davis) ensures RC targets high-grade zones.
While justified, OZM’s approach delays deep testing, misaligning with market expectations. A hybrid strategy—combining AC mapping with targeted RC at historical intercepts—could accelerate resource growth (e.g., 20,000–50,000 oz per program) and regain investor confidence.
