Maiden Mineral Resource Estimate (Resource) for the Penny West Project of 799 kt @ 13.8 g/t for 355,500 oz.

Includes 569 kt at 16.8 g/t Au for 306,800 oz from Penny North.

  • Located 25km south of Youanmi Mining Centre;
  • Blind discovery from +30ppb anomalous soil sample in 1990;
  • Mined by Eastmet / Metana (GMA) in 1991-1992;
  • Produced 91.4Kozs @ 18.1 g/t gold including low grade stockpiles;
  • One of the highest grade OP mines in WA in the modern era;
  • Current resource of 36,000 ozs at 5 g/t gold;
  • Quartz-sulphide vein 2-5m in width in Penny West Shear Zone;
  • Numerous high grade intersections below the pit;
  • Discovery cost A$40 per oz.

Penny West Gold Project – Resources

Spectrum Metals Limited (‘SPX’ or ‘the company’) is pleased to announce a maiden JORC 2012 Mineral Resource Estimate (“Resource”) at the Penny West Gold Project totalling 799,000 t at 13.8 g/t Au for 355,500 oz of contained gold.

  • Maiden Mineral Resource Estimate (Resource) for the Penny West Project of 799 kt @ 13.8 g/t for 355,500 oz;
  • Includes 569 kt at 16.8 g/t Au for 306,800 oz from Penny North;
  • High confidence: ~75% of Resources at an Indicated status (Indicated resources total 268,000 oz Au at a grade of 17.8 g/t Au, with the Penny North Indicated component grading 18.6 g/t Au for 247,000 oz Au;
  • Resource delivered <8 months since discovery of Penny North (March 2019) at an exploration cost of approximately $10 per oz;
  • Resource is shallow, delineated from 80m to 320m (below surface);
  • Resource indicates 1,480 ounces per vertical metre;
  • Initial metallurgical test work indicates that Resources are free milling with average recoveries of > 99%;
  • Mineralisation is open at depth and along strike and has very strong extension potential;
  • Recent extensional drilling is not included in the Resource shown in Figure 1. Results are pending and may form the basis for future Resource growth;
  • Diamond and RC drilling currently continues from Penny North, to Columbia Magenta;
  • Baseline environmental studies will be completed over the Penny North project in the December quarter.
Domain Indicated Inferred Total
Tonnes Au Au Tonnes Au Au Tonnes Au Au
t g/t Ounces t g/t Ounces t g/t Ounces
Penny North 414,000 18.6 247,000 155,000 12 59,800 569,000 16.8 306,800
Penny West 54,000 12.1 21,100 93,000 5.1 15,400 147,000 7.7 36,400
Minor Zones 82,000 4.6 12,300 82,000 4.6 12,300
Total 468,000 17.8 268,000 331,000 8.2 87,500 799,000 13.8 355,500

Table Above: Penny West Gold Deposit October 2019 Mineral Resource Estimate (2.0g/t Au cut-off)

Long section of the resource model with resource block grade and drilled diamond holes (awaiting results)

Penny West Gold Project – Significant Gold Intercepts

Since the acquisition of Penny West Project in December 2018, Spectrum Metals has been actively exploring this highly prospective landholding.

Initial assays from the Phase I RC drilling program were received in early March 2019, with the receipt of Hole SPWRC002 assaying 14m @ 14.4 g/t from 124m downhole, including 8m @ 23.3 g/t from 128m at a prospect now known as Penny North.

From that point an aggressive RC drilling program has continued to deliver very high-grade results, particularly at the Penny North discovery, as well as to the south of Penny West as in SPWRC006.

SPWRC001 2m @ 19.7 g/t gold from 115m.
SPWRC002 14m @ 14.4 g/t gold from 124m including 8m @ 23.3 g/t gold from 128m.
SPWRC006 5m @ 28.9 g/t gold from 203m, including 1m @ 103 g/t gold from 203m.
SPWRC009 3m @ 5.0 g/t gold from 86m including 1m @ 11.5 g/t gold from 86m.
SPWRC016 8m @ 24.2 g/t gold from 149m including 4m @ 43.7 g/t gold from 150m.
SPWRC018 9m @ 16.2 g/t gold from 130m including 4m @ 35.2 g/t gold from 135m.
SPWRC022 4m @ 105 g/t gold from 151m and 1m @ 11.5 g/t gold from 86m.
SPWRC024 2m @ 12.0 g/t gold from 173m.
SPWRC027 6m @ 47.4 g/t gold from 150m, including 2m @ 140.0 g/t gold from 153m.
SPWRC028 1m @ 16.2 g/t gold from 172m.
SPWRC029 11m @ 25.8 g/t gold from 131m, including 6m @ 46.8 g/t gold from 131m.
SPWRC030 1m @ 11.4 g/t gold from 175m.
SPWRC032 2m @ 12.9 g/t gold from 186m and 1m @ 11.9 g/t gold from 196m.
SPWRC039 3m @ 70.8 g/t gold from 205m including 1m @ 180.3 g/t gold from 206m.
SPWRC040 11m @ 11.7 g/t gold from 229m including 7m @ 17.5 g/t gold from 230m.
SPWRC047 4m @ 4.60 g/t gold from 111m including 1m @ 18.0 g/t gold from 111m.
SPWRC051 13m @ 3.2 g/t gold from 141m including 1m @ 26.0 g/t gold from 149m,
and 4m at 16.8 g/t gold from 116m including 2m at 31.1 g/t gold from 116m.
SPWRC053 9m @ 7.7 g/t gold from 200m including 5m @ 13.3 g/t gold from 202m.
SPWRC054 7m @ 4.9 g/t gold from 225m including 1m @ 24.0 g/t gold from 231m,
and 3m @ 15.0 g/t gold from 239m.
SPWRC056 5m @ 24.4 g/t gold from 241m including 3m @ 40.2 g/t gold from 241m.
SPWRC067 3m @ 34.4 g/t gold from 264m including 1m @ 99.9 g/t gold from 265m.
SPWRC068 9m @ 24.1 g/t gold from 265m including 3m @ 69.3 g/t gold from 267m.
SPWRC069 9m @ 15.9 g/t gold from 294m including 6m @ 22.5g/t from 295m.
SPWRC070 2m @ 16.6 g/t gold from 274m.
SPWRC071 2m @ 48.7 g/t gold from 264m.
SPWRC072 1m @ 7.1 g/t gold from 310m and 2m @ 27.1g/t gold from 315m.
SPWRC080 2m @ 50.5 g/t gold from 338m.
SPWRC081 4m @ 63.1 g/t gold from 289m including 3m @ 83.7 g/t gold from 289m.

Penny North Plan View

The drilling at Penny West has focussed primarily on an area to the north of the original open pit, mined in the early 1990’s.

Well over 60 holes and in the vicinity of 10,000m of RC drilling continues to delineate the high-grade Penny North shoot that contains abundant visible gold in a shear-hosted Archaean quartz lode, displaying an abundant pyrite-pryrhhotite-galena-spahalerite sulphide assemblage. The presence of galena is an important indicator mineral for high-grade gold in the Penny West mineral system.


Penny West Gold Project Long Section

Showing the spatial relationship between the Penny West Open Pit & the Penny North discovery.

Current understanding proposes an indistinct fault offset between the two lodes, however future drilling intends to draw the two edges of the Penny West and Penny North lodes together as Spectrum methodically explores the ground between, in addition to extensional drilling down dip and down plunge on both lodes.


Penny North Long Section

Shows a zoomed in image of the Penny North lode, with many high-grade intercepts and a gradually south plunging orientation . It appears that the lode is maintaining its tenor and continuing with strength as the depth potential is explored.


Regional Long Section – The “Gap Zone”

Between the northern edge of the Penny North discovery and the Magenta/Columbia prospect, approximately 1.4km to the north, there exists a virtually unexplored length of highly prospective shear zone. This area has only undergone limited wide-spaced reconnaissance air-core drilling in the early 1990’s.


Regional Magnetics

Spectrum has commissioned an extensive geophysics program that has led to the generation of numerous priority targets for drilling along the well-defined shear zone in the “Gap” as well as other targets more regionally on the granted Penny West leases.

Surface Magnetics imagery 1VD

Initial Metallurgical Testwork

Spectrum has completed via Independent Metallurgical Operations Pty Ltd (IMO Perth) an initial metallurgical test work program on selected composites of RC chips within the Main Lode at Penny North.

Highlights from the program include:

  • Composites selected from RC samples from holes SPWRC002 and SPWRC018;
  • Exceptional total overall (gravity + leach) recoveries of 99.1% and 99.2% achieved for the two composites;
  • Composite SPWRC002 displayed gravity recoverable gold of 76.9%;
  • Composite samples are free-milling and highly amenable to a standard crush-grind-gravity-leach flowsheet.

Composites of ore-grade material were split from the RC chips of two (2) of the initial holes drilled into the Penny North discovery, specifically

  • SPWRC002 – 8m composite from 128 to 136 metres downhole;
  • SPWRC018 – 4m composite from 135 to 139 metres downhole.

Following receipt of the samples and stage crushing to -2.0mm, a 1kg sub-sample was split from each composite, pulverised and split into two (2) equal 500g charges for SG determination and head assay. An average SG over the composite intervals yielded 2.67 tonnes per cubic metre, generally in line with expectation based on the composite lithology.

Sample ID SG
SPWRC 002 2.65
SPWRC 018 2.69

Specific Gravity of Composite sample

Gravity recoverable gold was assessed for each composite prior to cyanide leach testing. A sub-split of approximately 6kg of each composite was ground to 80% passing 300 µm and passed as a single pass through a standard 3” Knelson laboratory concentrator.

The Knelson concentrate was subsequently intensively leached for 20 hours, emulating industry standard gravity concentrate leach conditions.

Gravity gold recovery data for the composites is shown below. The gravity recovery for each sample is back calculated from the intensive leach solution assays and calculated head grades from the gravity tailings leach tests. The two composites were quite different in terms of gravity recovery, with composite 002 returning a gravity recovery of 76.9%, which is considered extremely high by industry standards, whilst composite 018 returned a more modest 10.6%. The very high gravity recovery observed for composite 002 indicates a high proportion of free milling, liberated coarse gold is present in the sample, whilst composite 018 appears to contain a higher proportion of finer and or flaky gold. Further testwork is planned to investigate the effect on gravity gold recoveries of lowering the relatively coarse 300 µm grind on this portion of the flowsheet.

Parameter Units SPWRC 002 SPWRC 018
Calculated Head Grade g/t 24.59 23.30
Concentrate Mass Recovery % 0.46% 0.29%
Gravity Gold Recovery % 76.9% 10.6%
Gravity Gold Recovery g/t 18.77 1.13
Concentrate Gold Grade g/t 4,167 897
Leach Feed Grade g/t 5.83 22.17

Sample Head Assay & Gravity Gold Recovery

Tailings from the gravity concentration stage were recombined with the residue from intensive cyanidation of the gravity concentrate for further conventional kinetic cyanidation testing. A 1kg charge was split from the recombined tailings of each composite and ground to 80% passing 150µm prior to leaching under the following leach conditions.

Parameter Target
Initial CN Concentration (ppm) 500
Maintained CN Concentration (ppm) 300
Leaching pH 9.80
Leaching Pulp Density (% w/w) 40.0
Dissolved Oxygen Concentration (ppm) 8-10

Cyanide Leaching Conditions

The results demonstrate that both composites are highly amenable to cyanide leaching under conventional conditions and a 150 µm grind, with final gold recoveries of 96.4% and 99.0% for composite 002 and 018 respectively.

Duration (hrs) Au Solution Grade(ppm) Cumulative Leach Recovery
0 0.00 0.00 0.0% 0.0%
2 2.17 3.32 55.7% 22.7%
4 2.85 4.90 72.9% 33.5%
8 3.45 7.15 88.0% 48.8%
24 3.83 12.41 97.4% 84.6%
48 3.89 15.04 96.4% 99.0%

Composite leach test results

Composite 002 demonstrated faster leach kinetics than composite 018, with complete leaching achieved after 24 hours. Composite 018 achieved full extraction somewhere between 24 and 48 hours but despite being slower leaching, achieved higher leach recovery than composite 002. Both composites achieved very similar residue (tail) grades as shown in Table 4.6. In practice, operating at higher free cyanide concentration may assist in improving the leaching rate for composite 018. Alternatively, longer residence times could be employed by way of additional tankage in a CIL or CIP circuit.

Kinetic leach curves


The Overall Mass Balance for both composites for the mill – gravity – leach flowsheet is tabled below.

Parameter SPWRC 002 SPWRC 018
Total Sample Mass Received (kg) 17.43 13.665
Assay Head Grade (g/t) 20.5 25.3
Recalculated Head Grade (g/t) 25.1 24.7
Gravity Concentrate Mass (g) 27.3 17.4
Total Gravity Stage Recovery (%) 76.9% 10.6%
Leach Feed Grade (g/t) 5.8 22.2
Leach Stage Recovery (% of Leach Feed) 96.4% 99.0%
Tails/Residue Grade (g/t) 0.213 0.216
Total Recovery (%) 99.2% 99.1%

Penny North sighter flowsheet Mass Balance

For Composite 002:

  • Assayed head grade varied against mass balanced head grade by 18%, this variation between the head and calculated assays are indicative of significant coarse gold in the sample;
  • Gravity concentration at a P80 of 300µm yielded gravity recovery of 76.9%;
  • Calculated leach feed grade was 5.8g/t;
  • CIL leaching at 150µm recovered 96.4% of the gold in the leach feed;
  • The final residue grade after undergoing both gravity concentration and leaching was 0.213g/t;
  • The combined overall recovery for the gravity and leach testing was 99.2%.

For composite 018:

  • Assayed head grade varied against mass balanced head grade by -2%. This indicates a relative absence of coarse gold in the sample compared with sample 002, particularly when considering the variation in head assays was also relatively low;
  • Gravity concentration at a P80 of 300µm yielded gravity recovery of 10.6%;
  • Calculated leach feed grade was 22.2g/t;
  • CIL leaching at 150µm recovered 99.0% of the gold in the leach feed;
  • The final residue grade after undergoing both gravity concentration and leaching was 0.216g/t;
  • The combined overall recovery for the gravity and leach testing was 99.1%.

Further Work:

Based on the results from the sighter testwork conducted, IMO has recommended that future testwork campaigns incorporate more detailed work involving the following components:

  • Comminution testing including crusher work index (CWi) and ball mill work index (BWi) testing to determine ore hardness and energy requirements for size reduction;
  • Grindsize optimisation work to determine the optimum trade-off between grindsize and gravity and leach recovery. And;
  • Cyanide optimisation to determine the optimum free cyanide concentration to enable sufficient leach recovery to be achieved in the minimum timeframe.