Redbank Joint Venture
This project is a joint venture with Carpentaria Exploration Limited (ASX:CAP) whereby GBM can earn up to an 80% interest in the Redbank Nickel Project, located 140 km northwest of Townsville. The project mineral target is a nickel laterite with a very similar signature to the nearby and historic Greenvale nickel laterite complex.
This JV provides a low cost entry into the nickel sector to complement our gold and base metals programs at Malmsbury and Willaura in Victoria and at Dee Range near Rockhampton in Queensland.
Stage 1 involves drilling the main target by the end of April 2008 and if successful, GBM can elect to earn a 51% interest by contributing expenditure of $1,000,000 within 18 months of completing Stage 1.
Exploration success at the Redbank Nickel Project may lead to the potential opportunity to toll treat ore at the Yabulu Lateritic Nickel Refinery located 120km north west of the Redbank project. The Yabulu Lateritic Nickel Refinery toll treats ore from various 3rd party mines.
The key terms for GBM to earn an interest in the Redbank tenement, EPM14840, are:
Stage 1 - GBM completes a 150m drilling program by 31 April 2008;
Stage 2 - After successful completion of Stage 1, GBM can elect to earn a 51% beneficial Joint Venture interest by contributing $1.0 million within 18 months;
Stage 3 - At the completion of Stage 2 and in the event that CAP does not elect to contribute, GBM can increase its Joint Venture interest to 65% by contributing a further $2.0 million within 36 months;
Stage 4 - At the completion of Stage 3 and in the event that CAP does not elect to contribute, GBM can increase its Joint Venture interest to 80% by contributing a further $2.0 million within 24 months;
In the event that Cap does not elect to contribute to the Joint Venture, then its 20% Joint Venture Interest will convert to a 5% net profit royalty in relation to minerals extracted and sold by GBM.
Strong nickel province
The Redbank Creek Magnetic Anomaly is a 9km by 5km ovate magnetic high located 65km north east of the historic Greenvale Lateritic Ni Co Mine and 140km northwest of Townsville in north Queensland. This region is also host to several other significant Ni occurrences including the Nornico and Lucky Break Prospects.
Regional geological studies focussing on Ni bearing laterites in eastern Australia have shown a close spatial coincidence between large magnetic highs such as the Redbank feature and elevated Ni geochemical results. Importantly, the highest grade components to these deposits are frequently associated with internal zones of magnetite destruction or magnetic lows. The Greenvale Ni Co lateritic deposits are characterised by such a pronounced magnetic low.
The Redbank Magnetic Anomaly has such an internal magnetic low measuring 2km by 1km. Identified Ni bearing mineral occurrences are located peripheral to this magnetic anomaly in Silurian metasediments. The entire magnetic anomaly is covered by continental Tertiary clay, sand, gravel and residual deposits. This cover sequence is interpreted to be 30 to 40 metres in thickness. The source of the magnetic anomaly has not previously been identified but the character and shape of the anomaly is suggestive of an intrusive whose composition is unknown.
A regional soil sampling traverse over the magnetic anomaly targeting the magnetic lows was completed by Carpentaria Exploration Limited. It identified a low order but coincident Ni and Co anomaly associated with the magnetic low. Given the benign nature of the Tertiary cover sequence and the development of this coincident Ni Co anomalism over the magnetic low, the target requires scout drill testing.