Thisyear’s AGM was very different to 12 months ago but I am probably more excitedfor the coming year. There was 2 shareholders at 2020's AGM and we’ve graduated toroughly 25 today which was very exciting to see (included Hartley’s broker andsome of the company’s staff).
Mysummary of proceedings (and my chats with the team) are below:
Intro
- Andy ran over the company’s position, outlining his opinion that the market is currently valuing the assets at fair value but has not assigned any value to exploration upside. He commented on the tight corporate structure and praised Paul’s leadership for making this happen;
- Brief comments on the credentials of the board – this was a major part of my decision to invest and here are some regurgitated comments:
- Paul has a wealth of experience (25 years) in the financial and investment markets which has seen him involved with resource companies through all stages of the mining cycle. He remains proud of the low SOI and is endeavouring to continue this trend; and
- Andy has 30 years of experience in the mining industry and has also taken projects from grassroots exploration to mining operations. He has been involved in the discovery of multiple mines in WA including King of the Hills and Bannockburn.
Wallbrook
- Reiterated that a tenement package of this style takes a mountain of effort and years to put together (recommend checking quoted post for further comments - this isn't built overnight). He outlined that the continuity of the package was paramount to ensure that there wasn’t any strike missed. This initially slowed the exploration process (as exploration may have led to the surrounding land appreciating) but it is really gearing up now;
- The package largely sits on mining leases which will enable a mining plan to be delivered to DMIRS and generally the permitting process can be completed within 3 – 6 months. This de-risks the project due to reduced regulatory interference;
- 30,000m drill program is ongoing with one RC drill rig currently spinning. The second RC drill rig will commence next week and continue into the new year;
- The drilling strategy has typically aimed to define the extent of the deposits – essentially this is sending down some ballsy drills with a view to tagging the deposit (i.e. all deep DD holes) to find the limits which would then be followed up by infill drilling – my comment is that we’re yet to find the end;
- Referred to the Crusader-Templar long section and outlined the scale whilst noting that there was plenty of drilling ahead to fill in the middle of Crusader / Templar. My chat with the geos following suggests that ‘the right rocks’ are coming out of these drill holes.
- To outline the scale, Andy recounted last week's broker / analyst site tour. Essentially, the tour party drove to the prospect site and walked the 1.6km of strike to understand the size (trucks are just blips on the horizon at 1.6km);
- Andy did qualify this comment (i.e. this is not confirmed at all) but over-layed NST’s Karari deposit over the long section 4 times (something like the below) – twice over Templar and twice over Crusader. Karari has a measured, indicated and inferred resource of 4.275m ounces (31 March) and has previously mined a few 100k ounces;
- Then flipped to the cross-section, noted that this diagram does not allow any room to hide poor results. He mentioned that it was exactly what the geos wanted to see, with an open pit for supergene mineralisation and then flowing into the lodes for UG.
- It was again reiterated that the entire Crusader / Templar prospect showed good continuity of mineralisation and similar patters were appearing along strike.
- You could clearly tell Andy was excited by the drill trays. For background, the geo team has been at Karari over the years to collect rock samples and study the geology. The results from the DDHs were very hard to find and clearly synonymous with Karari geology.
The4 styles of alteration seen at Karari only occur with each other (i.e. sodicalteration overprint must be present for quartz-albite-ankerite overprint whichmust be present for quartz-albite-ankerite veining). Each layer gives a highprobability of mineralisation flowing and is what we have seen in all results;
This essentially saw the company receiving unsolicited calls from independentgeos to comment that NXM appears to have cracked the area;
- My opinion is that the results from DDH4 and DDH5 will prove economic to mine UG and geo team is extremely confident these assays will return exciting results.
Regional
- Andy outlined the volume of work completed by the team regionally, including ongoing ground magnetic works. The magnetic works has been extremely successful in identifying interesting prospects (i.e. similar magnetic signatures to Crusader / Templar) that will be drilled in the new year;
- As seen below, the prospects are about 1.6km apart which is developing a pattern aligned with the geological understanding.
Bethanga
- Team previously considered Bethanga in 2018 but was stymied by the pandemic. At a high level, the prospect looked good and was sitting in the right rocks (Cadia and Nothparkes projects) for this area;
- Preliminary exploration had commenced and ground magnetic surveys were ongoing. NXM was also able to arrange an extension to the option period (at no further cost) due to travel restrictions.
AGM again ran very smoothly, management is all over the asset value and is forward planning exploration given their experience with the geology. I am of the opinion the current campaign will keep producing results and the geo team will continue to infill the exciting DD results.
The Crusader / Templar prospect is now at a stage where it will command management's attention and prudent governance will continue to see quality ounces picked up at low cost.
Hold them tight, it's going to be a fun ride!
