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Horizon Minerals Ltd

Intermin Resources plans to add gold resources and facilities to new Horizon entity

Snapshot

Intermin gained today on news it may snap up a Coolgardie project and plant from Focus Minerals.

Drill rig in the Goldfields

Quick facts: Horizon Minerals Ltd

Price: $0.15

Market: ASX
Market Cap: $62.06 m
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  • Intermin is joining forces with MacPhersons Resources to form Horizon Minerals by mid-year
  • Focus’ Coolgardie Gold Project could contribute gold ounces and a plant if acquired
  • Newly-merged Horizon would aim to get cracking on a feasibility study this year
  • The new board would target a swift construction decision after releasing the study

What does Intermin Resources do?

Intermin Resources Ltd (ASX:IRC) specialises in gold exploration on Western Australia’s Goldfields. It is run by Jon Price, a metallurgist and minerals economist who has more than 25 years experience in the mining industry and was managing director of Phoenix Gold Ltd (ASX:PXG) before it was swallowed up by Evolution Mining Ltd (ASX:EVN) (FRA:WE7) (OTCMKTS:CAHPF).

What does Intermin Resources own?

The key assets are its gold projects alongside and north of the city of Kalgoorlie-Boulder and up to the town of Menzies.

Another asset is its Richmond Vanadium Project in Queensland in which JV partner AXF Vanadium Pty Ltd hopes to acquire a 75% stake by March 2021.

In WA's Goldfields-Esperance region Intermin is joining forces with MacPhersons Resources Ltd (ASX:MRP) (FRA:9PR) to form a combined gold company with at least 1.19 million gold ounces.

The merging companies plan to call themselves Horizon Minerals Ltd.

MacPhersons’ 507,000-ounce Boorara deposit 10 kilometres east of Kalgoorlie-Boulder would be an important project for the merged entity, with work underway this year to test its very large gold system to see if it can provide a baseload for a processing facility.

If the partners add Focus Minerals Ltd’s (ASX:FML) (FRA: FZA) 2.1 million ounce Coolgardie Gold Project to the mix for $40 million, as signalled today, the new company would hold 3.32 million gold ounces.

Intermin has a five-month deed permitting it to agree to buy the Coolgardie project for $40 million in a cash and scrip over a 3.5-year period.

The project has a plant attached to it - the Three Mile Hill processing plant - which is on care and maintenance and has a 1.2 million tonnes a year processing capacity.

Intermin’s core Teal, Goongarrie Lady, Binduli, Anthill and Blister Dam gold projects each have the potential to provide more than 2 g/t gold, oxide and transitional feed amenable to open pit mining to supplement a baseload feed from Boorara.

Intermin’s mineral resources are found in the Teal, Anthill, Menzies and Goongarrie deposits and make up a total resource of 9.26 million tonnes grading 2.05 g/t tonne gold for 609,625 ounces at a 1 g/t cut-off.

Teal open pit, 12 kilometres north of Kalgoorlie-Boulder, has potential to deliver about 22,000 ounces of gold grading 3.2 g/t and 94% gold recovery.

A 2018 drilling program pushed estimated ounces to 562,000 gold ounces, with further resource updating expected this quarter.

Intermin is consolidating its portfolio ahead of the planned merger with MacPhersons, grabbing back 100% of its Menzies and Goongarrie joint venture projects from troubled partner Eastern Goldfields last week.

Goongarrie Lady open pit was the subject of a feasibility study which produced results of about 12,000 ounces of gold at 2.9 g/t gold and about $5.7 million in cash flow over a seven-month life-of-mine.

Intermin hopes to merge with MacPhersons by June 2019 and embark on a feasibility study for a mine-and-plant development this year targeting a project life of at least 4 or 5 years.

Merged entity Horizon’s board would then target making a construction decision soon after the company completed its study.

In Queensland, Intermin’s Richmond vanadium/molybdenum JV has four deposits - Rothbury, Lilyvale, Manfred and Burwood - all with inferred resources that total 2,579 million tonnes grading 0.32% vanadium and 262 g/t molybdenum trioxide at a 0.29% vanadium cut-off.

Inflection points

  • Intermin’s assessment of the value of the Coolgardie project and Three Mile Hill plant to the Horizon portfolio

  • Shareholder support for the proposed merger with MacPhersons

  • Project, plant and feasibility study financing support

  • Gold price trending during definitive feasibility study work

  • State Government regulatory approvals

Managing director Jon Price sees value in acquisition and merger

“The potential consolidation of the Intermin and MacPhersons assets with the Coolgardie Gold Project would be a natural fit, delivering additional high-grade open cut and underground ore sources to the base load Boorara project and Intermin’s satellite projects, as well as a conventional 1.2 million tonnes per annum processing facility,” Intermin managing director Jon Price said.

Proposed ground near Coolgardie, if Intermin picks up Focus' gold project along with its plant

Proposed ground near Coolgardie, if Intermin picks up Focus' gold project along with its plant

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