Remarkable mineralisation consistency and continued impressive grades have been seen in the first round of assays from the recent 3,600m RC drilling program at Verity Resources (ASX: VRL)’s flagship Monument Gold Project, with results such as 5.8m at 2.5g/t from 15m, 2.9m at 3.6g/t from 30m, 3.91m at 3.81g/t from 57m, and 19.4m at 1.65g/t from 84m, including 5.8m at 2.25g/t. Seeing these consistent grades throughout the widths of the BIF main mineralisation lode heavily reinforces the prospect of profitable open-pit mining, and validates the recent pit optimisation study, which VRL will now take into a scoping study that will be followed by the granting of a mining licence. 

The program was expected to produce stellar results due to the high-grade areas being twinned drilled, which have recorded historical results such as 5m at 2.03g/t Au from 60m, 6m at 3.15g/t Au from 95m and 5m at 3.22g/t Au from 130m. By completing a 25m by 25m drill design pattern, the geological model has been confirmed alongside grade continuity – allowing for an upgrade to the JORC indicated classification, which mining studies can be based on.

The upcoming 6,400m diamond and RC drilling campaign will both extend areas of established mineralisation by targeting high-grade shoots around assays such as 7m at 13.15g/t Au from 7m and 3.90m @ 3.16 g/t from 48m, while also testing the extents of the known banded-iron formation along strike and at depth. The $3 million that the company just banked from a strongly supported capital raise led by Evolution Capital will take Monument’s existing 154koz at 1.4g/t deposit through to its highly anticipated upgrade before the end of the year. The placement, which saw VRL Non-Executive Director Patrick Volpe invest $250k to take his stake to 16.23% of the company – will take Monument through to a scoping study and mining permits level of development readiness that should act as a serious value creation catalyst. 

You can read our initial take on VRL here, where we outlined the potential for an exit similar to the $173/oz that STK got from NST for its Millrose deposit. $5.7 billion GMD and its 3Mtpa mill sit under 30km away from Monument – and it operates at just 0.8g/t Au, while GMD is aggressively turning the plant into a central processing hub for higher grade ore. VRL currently has a market cap of $9.3 million with a cash balance of $3.5 million, which has the company trading at just under $38/oz EV/Resource – before the resource upgrade later this year. At 1.4g/t, the size of Monument is not nearly as relevant as its grade, given it would make an excellent source of supplemental ore for Laverton.

Even in a toll treating or joint venture situation, the economics should be attractive. A back of the envelope assessment of what production figures could be would likely be similar to what AWJ recently achieved in WA. The company brought in a partner who funded the entire capex and opex of its 30koz satellite deposit in exchange for a 50/50 profit share split. AWJ ended up pocketing $17 million in cash after the operation produced almost $120 million in revenue at an average selling price of around $3,900/oz – compared to gold’s current record levels of $5,675/oz. 

This implies an average AISC of $2,800/oz, and is especially relevant when considering the ore was sent to region processing hubs in WA similar to Laverton – but much further away. If VRL could produce at a similar price, and with where gold trades right now allowing for a $2,875/oz margin – there is $443 million of profit that could be produced from Monument’s existing 154koz resource, let alone the upcoming upgrade.

Excitingly, VRL will also be testing a few of its many syenite-intrusion targets – the exact same style of mineralisation seen at analogous WA monster deposits such as 1.4 Moz Jupiter and 7Moz Wallaby. Geochem and AC drilling well-outside of the existing resource at Monument, which hit 24m at 3.24 g/t from 44m, including 12m at 6.35 g/t, also came into contact with highly encouraging geological structures that point towards this type of mineralisation being present at the project.

The targets VRL have at Monument are a very exciting two-sided approach. On one hand, it’s growing a resource that can be progressive drilled out by tracing known and well-understood mineralisation, which is currently open along strike and at depth in all directions. On the other, it is looking to test intrusive targets that could hold a gigantic deposit. 

So far, majority of the mineralisation at Monument has been defined within 125m of surface – but there are a couple of deeper intercepts that show outstanding grades, such as 5m at 3.22g/t Au from 130m and 2.10m at 6.58 g/t from 263m. The imminent program will comprise 77 drill holes (5 DD and 72 RC) for a total of approximately 6,400 metres. The RC will hit all required parameters for increasing the geological confidence and facilitate the upgrade of existing 154koz resource from an inferred to indicated confidence level, while also acting as a precursor to the next phase of scoping studies. With just 10% of the project’s 20km structural strike length drilled with detailed aircore and RC drilling, there is still so much more potential waiting to be discovered at Monument. 

The thorough understanding of Archean greenstone-orogenic mineralisation in general and in the context of Monument is allowing VRL to take a masterful approach to its exploration strategy, which is headed by industry veteran and structural geologist Dr. Rick Gordon. The latest drilling results can be seen below, along with the historical assays from the 139koz Korong resource:

Source: VRL

Assays due from the 15koz at 2.1g/t Waihi deposit are due soon, where grades have historically averaged a touch higher than Korong:

Source: VRL

Huge Potential in Intrusion Targets

Monument’s intrusion targets are built around a clear thesis that acknowledges alkaline intrusions and their dyke swarms can create receptive traps, while late-Archean orogenic fluids supply and focus gold into structurally prepared sites within and adjacent to those bodies – which has been clearly documented at 7Moz Wallaby and in 1.5Moz Jupiter’s syenite-associated lodes.

VRL’s AC campaign has already outlined credible vectors on intrusive contacts and favourable stratigraphy. The brilliant hits from Fred’s Well, such as 24m at 3.24 g/t from 44m, including 12m at 6.35 g/t, as well as 3m at 2.98 g/t from 72m, within a mixed package of mafic, ultramafic, shale, chert and felsic porphyry, combined with pathfinder elements including Ag, As, Ba, Bi, Cu and Mn with As above 20 ppm and Cu above 100 ppm. The intercepts can be seen below:

Source: VRL

North Well shows a 1,500m supergene footprint with best AC of 20m at 0.39 g/t from 60m including 4m at 1.06 g/t and 8m at 0.37 g/t, with numerous granitic and porphyry dykes and mineralisation focused along porphyry/granitoid contacts with mafic volcanics or sediments. VRL ran a 19-hole, 757m AC program a few months ago at Triton, Star Well and Korong West to test structural-stratigraphic positions along the same corridor, and Triton targets were selected because the architecture mirrors Fred’s Well.

The analogues frame the upside and help interpret those AC vectors. At Jupiter, company and academic work describe several syenite pipes and linking dykes emplaced into basalt along a more than 2km corridor, with mineralisation concentrated within and adjacent to the intrusions and remaining open below pits. It’s an intrusion-associated lode model consistent with Monument’s intrusive contacts, felsic porphyry and Au-As-Bi-Cu associations.

At Wallaby, gold is focused in and around a south-plunging syenite pipe expressed as an actinolite-magnetite-epidote-calcite alteration column, widely interpreted as an orogenic overprint on a magmatic-hydrothermal framework. While Monument’s shallow AC can’t definitely assert a Wallaby-style pipe directly, using RC/DD to test down-plunge contacts and log for AMEC-style alteration can – which is exactly what VRL are about to do. In that context, the 24m at 3.24 g/t from Fred’s Well is an extremely meaningful vector to a larger intrusive-adjacent system, subject to RC confirmation of geometry, true width and continuity.

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Disclaimer: This article is for informational and marketing purposes only, and does not constitute financial advice or a recommendation to invest. All opinions expressed are our own. We may receive fees or other forms of compensation in connection with the publication of this content, and may own shares in any of the mentioned companies. Please do your own research and seek professional advice before making any investment decisions.