Business Overview
Northwest Resources Limited is an emerging Australian gold producer listed on the Australian Securities Exchange (ASX: NWR).
The company is currently developing its flagship Nullagine Gold & Antimony Project in the eastern Pilbara of Western Australia.
The project hosts a combination of very high-grade gold/antimony deposits amenable to underground mining located on the Blue Spec Shear and numerous moderate grade open pitable satellite deposits located on the Camel Creek Trend. This combination of underground and open-pitable deposits is similar to successful projects located in some of Western Australia’s most prolific goldfields, such as Mt Magnet and Meekatharra.
The company has a tight capital structure, is well funded and has no debt.
Strategy
Northwest’s strategy is to build a sustainable cash generating mining operation at Nullagine to self-fund future development and enable the payment of dividends to shareholders.
Towards this strategy, Northwest has agreed to a 50/50 joint venture with Millennium Minerals Limited (Millennium) (ASX: MOY) under which ore from Northwest’s Camel Creek Trend gold deposits will be mined and processed by Millennium. The joint venture will be managed by Millennium and will not require any capital contribution by Northwest. Joint venture ore will be processed through Millennium’s 1.5MTPA Golden Eagle treatment plant which is currently under construction and joint venture mining is anticipated to commence in early 2015.
The joint venture will underwrite the transformation of Northwest from an advanced explorer into an emerging gold producer leaving Northwest free to focus on the development of its core Blue Spec Shear high grade gold-antimony deposits into one of the highest grade gold underground mining centres in Australia.
The current resource inventory of 329,000oz @ 20.7g/t & 9,000t Sb at the combined Blue Spec-Golden Spec deposits establishes a robust platform for future gold and antimony production. Feasibility studies and permitting of the proposed project are advanced and Northwest is in discussions with a number of underground mining contractors to mine these deposits.
The high-grade Blue Spec Shear hosted deposits are polymetallic ore bodies, containing both precious (gold) and industrial (antimony) metals. At a current metal price of over US$15,000 per tonne, the production of antimony as a by-product of gold processing has the potential to be a valuable source of additional revenue for the project. Antimony off-take contracts may provide the company with alternative project financing options.
Project Interests
Northwest currently holds a 65% interest in the key mining leases which comprise the Nullagine Gold & Antimony Project and is the manager of the project.
Northwest intends to exercise its right to acquire the minority interest in the key mining leases which will require the preparation of an independent project valuation and an independent expert’s report for the consideration of shareholders.
Northwest has progressively acquired prospecting licences over other highly prospective areas of the Nullagine Goldfield in which it has a 100% interest. It has selected these additional licence areas by utilising innovative exploration techniques, such as PIMA analysis and HYMAP aerial surveys to determine the most promising areas. Early-stage exploration suggests these additional licence areas have strong potential to host additional gold resources.