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Jun 2002 - Lasseter’s Reef

Has Lasseter’s Reef been found….by Newmont ?

In a recent Exploration Conference in May in Sydney, Bruce Kay of Newmont (previously Normandy) made two references to Lasseter in his presentation on the Tanami as the best block of ground in the world. The first reference was to the cave which Lasseter inhabited and may have added to the confusion since the second expedition may have gone in the wrong direction, while the second reference stated :

Figure 1 An outcrop in the TanamiGDNjun02

“ ….access to new ground can lead to immediate exploration success such as the recently discovered Groundrush orebody in 2001. After a period of 7.5 years of negotiations with the traditional owners, the 700koz Groundrush deposit was discovered within 7 weeks of the first sampling being undertaken. The deposit outcrops and visible gold (vg) was identified in weathered suphide-bearing quartz at surface.

Similarly new areas recently released by agreement with the traditional owners, are scheduled to be tested in the coming field season and are known to contain significant outcropping mineralized veining which has never been sampled let alone subjected to systematic exploration. These systems may not be the fabled Lasseter’s Reef but they do highlight the enormous prospectivity of the Tanami. Nowhere else in Australia is it possible to repeatedly find outcropping gold systems in a regional environment already known to host a world class gold mine.”

For a major company to even allude to Lasseter’s reef with the words “may not” which could be replaced by the words “could” is virtually unheard of. Lasseter reputedly stated that there were 7 to 14km of outcropping reef in which gold could be seen. More probably he said several miles (given the year in which it occurred and that became 7 miles which became 7 to 14km, and in fact saw vg in a reef outcrop where the outcrop stretched to the horizon).

In the presentation a slide was shown containing the picture in Figure 1, with a geo examining a rock outcrop in the Tanami with a helicopter in the background, and that is apparently what has happened with Newmont taking over Normandy. Cash has been injected to enable exploration to be conducted using a “chopper”, flying and landing on an outcrop and then sampling it.

In his presentation Bruce Kay stated that there was at least 30km of outcrop, and he thought that Callie would ultimately become at least a 10moz resource. He also thought that a new 20moz resource was waiting to be discovered somewhere in “the block”.

Bruce thought that in the Tanami virtually anything goes when it comes to finding gold orebodies such as Callie in siltstone sediments, the Granites in cherts and schists, Groundrush and Titania in dolerites and greywackes, and the Tanami mine in basalt. Groundrush is expected to be larger than 700koz with possibly some shoot extensions at depth, and one of the new areas of focus is the Lake McKay jv with Tanami Gold in which access is expected to be achieved possibly by the end of June 2002.

A slide was shown of the 40moz Getchell Trend and 107moz Carlin Trend both fitting into the Lake McKay tenements (again note this slide was not produced by a junior mining company) with the comment that aeromag inferred favourable lithologies. Newmont appeared confident about what they could discover using their own new refined BLEG analysis technique which gives higher peaks than conventional BLEG geochem analysis as was shown in an example over Titania.

We must admit to having been puzzled as to why Newmont and Anglogold entered into a bidding war and effectively paid an additional A$2bn to acquire Normandy, and maybe the Tanami was the hidden jewel that could not be completely exposed because not all the negotiations were in place, and the reserves/resources could not be delineated at depth due to drillhole-spacing limitations. At the time of the merger/ takeover there were mutterings coming out of Anglogold about how well the Tanami was shaping up.

We knew that there was one jewel hiding in the depths of Nimary (Nim3), which was exposed at Paydirt’s Gold Conference in Perth on the 22 March 2002 as Jundee’s Westside discovery by Newmont with massive visible gold intersections such as 5m at 3,280gpt and 0.3m at 2,910gpt (cut to 100gpt to 150gpt when reported). Since we can recall when Eagle Mining first “walked the streets of Sydney” with two pieces of drillcore from Nim 3 of which the first looked like a 1cm thick gold bar had been drilled through with rock on either side of it, and the second started out as 1cm thick solid gold part-way across the core and then traversed vertically about 1cm thick up the core.

However, if it transpires that there was the potential for mega orebodies being found and still to be found with a reasonably higher degree of certainty then it can be understood as to why the bidding war developed that effectively doubled NDY’s share price.

At the conference, Tanami Gold also presented a paper, which while the glimpses that could be seen of the slides looked interesting, it was a great pity that the presenter had not checked to see what presentation had been loaded and consequently tried to get through what appeared to have been at least 50 to 70 slides or more within 15 minutes. (This occurs at presentations, there was one at the Paydirt conference too, please check your presentations before you get to the podium, and end up apologizing throughout your presentation). Tanami Gold thought that their best prospect was the joint venture with Barrick since it contained “dozens of targets”.

The inference from both presentations is that the Tanami is indeed the jewel in the crown, and it is very much a case of “watch this space” in terms of gold production and major discoveries likely to come. As for Lasseter’s reef, “30km of outcrop with possibly some vg in it”, sounds remarkably close, so maybe Newmont has found it, or if not something that closely resembles its description.

Disclosure and Disclaimer : This article has been written by Keith Goode, the Managing Director of Eagle Research Advisory Pty Ltd, who has a Proper Authority with State One Equities, and with his associates, has interests in a number of gold stocks including Newmont, This e-mail address is being protected from spambots. You need JavaScript enabled to view it . The opinions expressed in this article should not be taken as investment advice, but are based on observations by the author. The author does not warrant the accuracy or completeness of any information and is not liable for any loss or damage suffered through any reliance on its contents.

  • Written by: Keith Goode
  • Saturday, 01 June 2002

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