ASX-listed explorer, Comet Resources, has finalised a US$20 million gold “streaming” and royalty financing facility with Raptor Capital International for the potential development of its high-grade Santa Teresa gold project in Mexico. Historic drilling at the project intersected some bonanza gold hits including 1m at an incredible grade of 958 grams per tonne, or a whopping 33 ounces of gold to the tonne.
According to the Perth-based company, the project area is relatively underexplored and possesses plenty of potential for resource growth. The Santa Teresa deposit hosts an existing non-JORC-compliant inferred mineral resource of 230,000 tonnes of ore grading a very respectable 8.7 g/t for 64,000 ounces of contained gold using a cut-off grade of 4 g/t. It remains open along strike and at depth, Comet says.
Santa Teresa is situated in the gold-rich El Alamo district about 100km south-east of Baja California in Mexico, just south of the US-Mexico border and about 250km south-east of San Diego in California.
The streaming or financing agreement with Raptor comprises a minimum of US$6 million and up to US$20 million in funding for the development of Santa Teresa. Comet can draw on the facility after certain conditions are met, most notably management deciding to go ahead with mining there.
Repayment of the monies accessed involves the delivery of gold produced from the project to Raptor rather than cash.
Comet has agreed to pay 15,000oz of gold for the first US$6 million and the deal also includes a 2.5 per cent royalty for Raptor.
Comet Resources Managing Director, Matthew O’Kane said: “Finalisation of the streaming agreement with Raptor provides Comet with non-dilutive capital for the development of a mining operation at the Santa Teresa gold project.”
“We are presently working towards upgrading the existing foreign resource estimate at the project to a JORC compliant resource. Information gained from completing the JORC resource will also assist us in planning the initial exploration activities at the project, including our first drilling program.”
The company plans to re-assay the historic drill core from Santa Teresa before embarking on a maiden exploration program, which is slated for the last quarter of this year or by the March 2021 quarter at the latest.
Some of the more impressive intercepts from previous diamond drilling undertaken in 2008 by Canada-based Premier Gold Mines include 2m at 32.4 g/t gold from 19m, 1m at 958.4 g/t from 239m, 1m at 125.9 g/t from 83.1m.
Other notable intersections include 3.9m at 39.4 g/t from 121.1m, 2.5m at 38.3 g/t from 173.8m and 1m at 33.9 g/t from 55m.
Some of the shorter but high-grade hits were 1m at 29.1 g/t from 201.5m, 1.2m at 24.6 g/t from 127.4m, 1.4m at 21.1 g/t from 152.7m and 3m at 19.9 g/t from 214m.
As is often the case with intriguing, complex, multiple narrow-vein lodes such as those that occur within the Santa Teresa deposit, there are big variations in grade ranging from the sublime to the ridiculous.
In parallel with the re-assaying work, Comet will also look to prepare an initial JORC-compliant resource estimate for Santa Teresa which will no doubt be highly anticipated by the market.
Comet currently holds a 50 per cent interest in the project and can take full ownership within two years if it proceeds with developing a mine.
Is your ASX listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Matt Birney
