Integra, Avoca liaison speculation gathers steam KATE EMERY, The West Australian February 2, 2010, 6:26 am
A bullish update from Integra Mining on the potential for an underground gold operation at its Maxwells deposit has sparked renewed market speculation of a tie-up with Avoca Resources.
Integra yesterday set an initial exploration target of between 3.7 million tonnes and 6.4 million tonnes at between 5.6 grams per tonne and 7 g/t for up to 1.3 million ounces of gold at Maxwells. The deposit is part of its wider Randalls gold project.
And although the company has yet to define a JORC-compliant resource, it said its recently completed desktop study had confirmed "excellent potential" for a long life, profitable underground mine at Maxwells.
The update did little to excite Integra's shares, however, which fell 1.5 to 22.
It did trigger fresh talk from industry sources that a deal with Avoca - which is on the hunt for additional reserves - could happen sooner rather than later.
Speculation Avoca could bid for Integra has been around for months, with Avoca's controlling shareholder Pala Investments understood to be pushing for the move. Pala also has a stake in Integra.
Speculation has increased in recent weeks because Integra is about to start spending cash on a new mill at Randalls, about 60km south-east of Kalgoorlie. Any move by Avoca is likely to come before its target spends too much cash on infrastructure that could prove unnecessary. A bid would be complicated by Avoca's latest tilt at Dioro Exploration. Given its failure to secure 50 per cent of Dioro the first time around, Avoca is reluctant to pursue another hostile takeover.
IGR Price at posting:
27.0¢ Sentiment: None Disclosure: Not Held
