blacksheep
05-02-2004, 04:30 PM
HLX has retraced 50% following news of gold resource increase to 800,000 oz at Tunkillia SA. With little debt, the current marketcap A$15m could offers leverage especially through options. The West Australian’s report follows. Disc: long the options.
Helix resurfaces from forgotten Craton By John Phaceas
SEVEN years after its first drill hits sparked South Australia's dramatic yet short-lived Gawler gold rush, Perth explorer Helix Resources is finally thinking about potential development options for its remote Tunkillia gold project. Helix yesterday released its first indicated-inferred resource estimate for Tunkillia's Area 223 deposit of 620,000 ounces from 7.3 million tonnes of ore grading 2.64 grams per tonne gold. Helix also lifted the "global" resource estimate for the project 40 per cent to 850,000oz after drilling extended the strike length of the mineralisation by 400m to 2km. In a faint echo of the heady days of the project, 200km north-west of Ceduna, the news sent Helix shares rocketing 9¢, or 38 per cent, to 32.5¢, lifting the value of the company to $18.5 million. Heralding the resource estimate as a key turning point for Helix, managing director Rob Mosig said the company was now awaiting the results of a scoping study into the deposit as a precursor to a full feasibility study. Helix expects the study to confirm the project as a potential 70,000-80,000oz a year open pit operation with a minimum life of at least six years. A $2 million feasibility study is due to kick-off next month, with the results due by November. "So we'd be looking to commission plant in the first quarter of next year, and production before June 2005," Mr Mosig said. Expected to cost around $25 million, Tunkillia would then be just the second stand-alone gold mine in South Australia after Dominion's Challenger project 180km to the north-west. Mr Mosig said the progress at Tunkillia was comforting after seven years of hard slog. "Looking back at the early drill holes, there were some spectacular intersections," he said. "Seven years on the sobriety comes in, because it's not as big as we were then considering. But it's certainly no dead duck either." Back in November 1996, Helix and the Gawler Craton, a vast tract of desert stretching 700km west of Adelaide and 800km north, became household names after the company reported intersections as wide as 36m averaging more than 4gpt gold. The results sent Helix shares racing from 45¢ to as high as $4.99 in two months, valuing the group at more than $230 million. In the process, Helix dragged along with it every other explorer within cooee as pundits predicted the Gawler Craton would be Australia's next big gold province. But the bubble burst in March 1997 when follow-up results from Tunkillia failed to live up to the market's overblown expectations.
Helix resurfaces from forgotten Craton By John Phaceas
SEVEN years after its first drill hits sparked South Australia's dramatic yet short-lived Gawler gold rush, Perth explorer Helix Resources is finally thinking about potential development options for its remote Tunkillia gold project. Helix yesterday released its first indicated-inferred resource estimate for Tunkillia's Area 223 deposit of 620,000 ounces from 7.3 million tonnes of ore grading 2.64 grams per tonne gold. Helix also lifted the "global" resource estimate for the project 40 per cent to 850,000oz after drilling extended the strike length of the mineralisation by 400m to 2km. In a faint echo of the heady days of the project, 200km north-west of Ceduna, the news sent Helix shares rocketing 9¢, or 38 per cent, to 32.5¢, lifting the value of the company to $18.5 million. Heralding the resource estimate as a key turning point for Helix, managing director Rob Mosig said the company was now awaiting the results of a scoping study into the deposit as a precursor to a full feasibility study. Helix expects the study to confirm the project as a potential 70,000-80,000oz a year open pit operation with a minimum life of at least six years. A $2 million feasibility study is due to kick-off next month, with the results due by November. "So we'd be looking to commission plant in the first quarter of next year, and production before June 2005," Mr Mosig said. Expected to cost around $25 million, Tunkillia would then be just the second stand-alone gold mine in South Australia after Dominion's Challenger project 180km to the north-west. Mr Mosig said the progress at Tunkillia was comforting after seven years of hard slog. "Looking back at the early drill holes, there were some spectacular intersections," he said. "Seven years on the sobriety comes in, because it's not as big as we were then considering. But it's certainly no dead duck either." Back in November 1996, Helix and the Gawler Craton, a vast tract of desert stretching 700km west of Adelaide and 800km north, became household names after the company reported intersections as wide as 36m averaging more than 4gpt gold. The results sent Helix shares racing from 45¢ to as high as $4.99 in two months, valuing the group at more than $230 million. In the process, Helix dragged along with it every other explorer within cooee as pundits predicted the Gawler Craton would be Australia's next big gold province. But the bubble burst in March 1997 when follow-up results from Tunkillia failed to live up to the market's overblown expectations.