The Ned's Creek Project (Lodestar 100%)

The Ned’s Creek project is located 150 kilometres north east of Meekatharra, Western Australia in the northern Murchison gold field. The discovery of Sandfire Resources’ DeGrussa Cu-Au deposit (10.7Mt at 5.1% Cu and 1.7g/t Au) in 2009 highlighted the potential of the region to host significant, high-grade copper deposits and initiated a new era of exploration within the Proterozoic volcano-sedimentary basins. The northern Murchison district has become one of Australia’s exploration hotspots with sustained exploration spending and a growing endowment of base metal and gold targets.

In addition to the DeGrussa deposit, the region hosts the Horseshoe Lights Cu-Au deposit (73,000t Cu metal), the Abra deposit (93Mt at 4.0% Pb and 10g/t Ag), the Magellan deposit (15Mt at 5.6% Pb), and is a significant gold producer. The Plutonic and Marymia gold deposits (5Moz. Au), the Peak Hill/Harmony gold deposits (1Moz. Au) and numerous gold and copper workings all occur along major structural and lithological boundaries. Lodestar’s tenements span a distance of 14 kilometres in a north easterly direction along the Jenkin Fault zone; a regional scale thrust-strike slip fault and the structural divide between the Marymia Inlier and the Yilgarn Craton.

Lodestar’s regional exploration is targeting gold and base metal deposits of significant scale, utilising advanced airborne and surface geophysical surveys, regional multi-element geochemical sampling and geological mapping. Anomalies defined by these methods are tested by detailed geochemical sampling and drilling.

The project comprises seven tenements with a combined area of 340 square kilometres.

Exploration commenced in December 2010 and Lodestar has since identified numerous gold and base metal drill targets. Significant gold targets have been discovered at Brumby and Contessa with the first high-grade gold drill intersections reported from Contessa in March 2013.

Ned's Creek - Exploration

The Ned's Creek tenements have received limited previous exploration for base metals and gold. Western Mining Corporation explored and mapped the area in 1969 - 1970 during exploration for sediment-hosted Zambian Copper Belt-style mineralisation and identified the McDonald Well prospect within a wider area of copper anomalism extending over 60 square kilometres.

CRA Exploration carried out an auger geochemical survey over the McDonald Well area and identified a number of multi-element geochemical anomalies associated with the carbonaceous shale unit of the Johnson Cairn Formation.

Lodestar completed a regional VTEM survey over the northern and western part of the Ned's Creek tenements.  The VTEM survey identified numerous anomalies (electromagnetic conductors) within the sedimentary sequence and five of these anomalies were the target of the first phase of RC drilling completed at the McDonald Well prospect in February 2011.  The drill holes tested targets within a carbonaceous shale horizon (a common host to sediment-hosted copper mineralisation) and returned wide intervals anomalous in base metal and associated elements from the weathered zone.  First-pass drilling at Little Well, located south of the Thaduna Copper deposit, reported elevated copper from regional aircore drilling targeting the Thaduna greywacke; disseminated chalcopyrite was observed in LNR460 reporting 1m at 0.65% Cu from 37m, LNR466 reporting 5m at 635ppm Cu from 40m to end of hole and LNR515, reporting 5m at 1550ppm Cu from 55m to end of hole.

Gold

--------- Figure 2 Location plan showing gold prospects Neds CreekFigure 2 Location plan showing gold prospects on the Neds Creek project.

Multi-element geochemical lag sampling led to the discovery of gold mineralisation at Contessa and Brumby and significant gold anomalies in sparse reconnaissance aircore drilling along the southern contact of the Contessa granite. The structural setting, diorite-granite-syenite host rocks within a composite intrusion, alteration mineralogy and Au-Ag-Bi-Mo-Te association strongly resemble syenite-hosted gold deposits in the Canadian Abitibi greenstone belt and within Western Australia, the Jupiter deposit being developed by Dacian Gold. Syenite-hosted targets include gold deposits of significant scale and the under-explored, large magmatic – hydrothermal system at Contessa represents a highly attractive greenfield exploration opportunity.

At Brumby shallow aircore drilling has intersected significant primary gold mineralisation in syenite host rocks and the western syenite contact is a high priority exploration target.  Results from this area include:

  • Widespread aircore intersections of greater than 0.1g/t gold and rock chip samples up to 27g/t Au, indicating a large system.

  • Strong anomalies reported from a single RC drill hole in the syenite host with 37 metres of the 99m hole (LNRC019) reporting greater than 0.1g/t Au

  • 7m at 0.51g/t Au from 45m in LNRC019, including 1m at 1.87g/t Au from 50m

  • 10 metres at 2.6g/t gold from 10 metres (including 3m at 8.2g/t) in adjacent aircore hole LNR598

  • 20m at 0.53g/t Au from 16m and 3m at 1.6g/t Au to end of hole in LNR824, a first-pass drill test of the syenite contact 700m southwest of LNRC019.

 --------- Figure 4 Cross-section exploration model Brumby Contessa mineralisationFigure 4 Cross–section of an exploration model for intrusion-related gold, showing the relative positions of the Brumby and Contessa mineralisation. 

--------- Figure 5 Visible gold in quartz vein Brumby Figure 5 Visible gold in quartz vein sample from Brumby.

At Contessa 40m spaced in-fill drilling targeted extensions to supergene and transition zone gold mineralisation within a diorite intrusion, results include:

  • 21m at 3.01g/t Au from 40m in LNR656
  • 10m at 5.6g/t au from 55m in LNR533
  • 10m at 1.2g/t Au from 50m in LNR545 and
  • 15m at 3.1g/t Au from 40m in LNR546
  • 20m at 1.61g/t from 48m in LNR792
  • 8m at 3.35g/t Au from 48m in LNR810
  • 10m at 0.91g/t Au from 80m to end of hole in LNR792
  • 3m at 1.0g/t Au from 96m to end of hole in LNR806
  • 13m at 0.40g/t Au from 80m to end of hole in LNR805

3D implicit modelling of the Contessa mineralisation using Leapfrog® software has revealed a shallow to moderate northerly dip, suggesting a primary source towards the strongly sheared granite contact. The drilling completed to date is too shallow to have effectively tested this area and a diamond drill hole is planned. The drill hole will target the interpreted down-dip position of mineralisation and identify the dominant structures to assist follow-up drilling.

--------- Figure 6 Contessa - Significant gold intersections in aircore drillingFigure 6 Contessa - Significant gold intersections in aircore drilling.

--------- Figure 7 Cross section view of Contessa mineralised envelopeFigure 7 Cross section view of Contessa +0.1g/t mineralised envelope, looking ease. White drill holes are postulated holes intended to target the down-dip extension to transition zone mineralisation.

--------- Figure 8 Plan view of Contessa mineralised envelopeFigure 8 Plan view of Contessa +0.1g/t gold mineralised envelope (GDA94 Zone 50).

Vango Mining Farm-in

Lodestar has entered a farm-in agreement with ASX-listed Vango Mining Limited to earn an 80% interest in four mining leases (Yowereeena) located immediately north of Lodestar’s Brumby and Contessa prospects. The farm-in agreement gives Lodestar access to an additional 35 square kilometre area that contains significant gold targets, including high-grade gold intercepts in drilling, and has had no exploration drilling since 2001.

The main targets identified at Yowereena include:

  • The 7 kilometre long northern contact of the Contessa granite, where it is believed there is high potential for intrusion-related gold mineralisation. Lodestar’s surface sampling at Brumby has identified gold anomalies continuing up to the tenement boundary and surface sampling completed by Dampier Gold Limited indicates these anomalies extend into the adjoining Yowereena tenements.

  • Boundary Fence prospect – high grade shallow gold intersections reported in RAB drilling completed in 1994. The drilling tested a 500m long soil anomaly believed to be related to an outcropping quartz reef within mafic schists. 6 wide-spaced RC drill holes were drilled in 1997, targeting the interpreted down-dip extent of the mineralised zone. RC drilling did not confirm the interpreted shallow dip of the system and Lodestar will complete surface mapping and initial drilling to confirm the original results.

  • Several gold anomalies were identified during regional reconnaissance drilling on traverses between 800m and 1400m apart. There has been no in-fill drilling in the area of the anomalies.

  • Geochemical sampling of the interface between cover and bedrock on 160 metre centres has identified contiguous gold, bismuth and arsenic anomalies adjacent to the granite contact. The anomalies are several hundred metres in length and in part coincident with the gold anomalies in regional reconnaissance drilling. There has been no follow-up drilling to test these anomalies

--------- Figure 9 Farm-in area showing Vango tenementsFigure 9 Farm-in area showing Vango tenements, historic RAB/aircore drilling and the Boundary Fence prospect.