Additional Information
Market: ASX
Sector: General Mining
EPIC: NTL
Latest Price: 0.01  (-25.00% Descending)
52-week High: 0.01
52-week Low: 0.01
Market Cap: 6.05M
1 year chart
1 day chart
New Talisman Gold Mines
www.newtalismangoldmines.co.nz

New Talisman Gold Mines (ASX: NTL), formerly Heritage Gold NZ, is a mining exploration company with gold projects in the Coromandel region of New Zealand and cobalt and base metal projects near Broken Hill in Australia.

New Talisman Gold Mines on track to commence year-end gold production

13th Jun 2014, 9:09 pm by Proactive Investors
New Talisman Gold Mines on track to commence year-end gold production

New Talisman Gold Mines (ASX:NTL) remains on track for first production out of its Talisman gold mine in New Zealand by the end of this year after raising $634,069 from its rights issue.

Talisman is located on the Coromandel Peninsula and had previously produced 1 million ounces of gold and 3 million ounces of silver.

It has a JORC Resource of 205,000 ounces of gold including a Reserve of 28,800 ounces of gold. 

The Talisman permit area has the potential to host between 0.55 million to 2 million ounces of gold and between 1.5 million to 6 million ounces of silver.

“The board was committed to offering existing eligible holders the opportunity to participate in the mines development at the generous discount provided, rather than fund via external sources,” chief executive officer Matthew Hill said.

He added the amount raised was one of the more successful rights issues of any Australian and New Zealand junior mining company over the last 18 months despite very difficult mining conditions. 

It also demonstrated tremendous support from its New Zealand shareholders who were the highest participants by far.

“Having given shareholders the opportunity to participate we can now look at further opportunities to complete the funding objectives of the company,” Hill added.

“We remain on target for the first production out of Talisman by the end of Q4 2014.”

Entitlement Offer

New Talisman had offered up to 282,941,751 shares priced at either NZ$0.008 or A$0.008 each through a 1 for 2 renounceable rights issue to raise up to $2.26 million.

With acceptances received for 78,722,716 shares, there is a shortfall of 204,219,035 shares.

The shortfall shares can be placed at the discretion of the Board no later than 3 months after the closing date of the offer which is 6 September 2014.

Talisman Gold Mine

New Talisman has obtained permits to annually process up to 10,000 cubic metres of remnant ore and underground bulk samples. An off-site agreement to toll treat this feedstock is expected shortly. 

The mine is well supported by existing infrastructure including roads and water supply.

It is preparing to carry out a bulk sampling program that is intended to validate parameters for a Phase One gold production program focussed on the current JORC compliant reserve of 28,800 oz AU. The full production program will require funding of NZ$5.4 million.

Annualised production is forecast to reach 12,115 ounces of gold and 36,000 ounces of silver over an initial mine life of 5 years. Phase Two will is expected to lead to a significant increase in production.

Talisman is located in the Coromandel Peninsula where alluvial gold was discovered in the 1850’s and was quickly followed by gold production from quartz gold in 1862. 

Major gold production to the current date includes Thames with 1.4 million ounces, Golden Cross 1.4 million ounces and Waihi which is operated by Newmont with 7.1 million ounces of gold.

Talisman was mined on 16 levels and good access is available on 8 Level where the Company has completed refurbishment for extensive channel sampling and drilling. 

It comprises the Maria, Crown/Welcome and Mystery veins and 8 Level leads into Crown, Mystery Woodstock and Dubbo veins.

Pre-Feasibility Study

A Pre-Feasibility Study completed in April 2013 for underground mining at Talisman confirmed an initial Phase One life of mine of 5 years to generate NZ$68.2 million in revenues to generate a cash surplus of NZ$23.4 million. 

Start-up capital to generate this level of revenue was estimated at NZ$5.4 million while NPV is estimated at NZ$15.5 million (A$14.3 million).

Production from Phase One is forecast to peak at an annualised extraction rate of 35,000 tonnes of ore to produce 12,115 ounces of gold and 36,000 ounces of silver.

Phase One operations incorporate funding for additional resource development that is expected to build into Phase Two operations that will exceed 5 years.

A sub-level stoping method will be deployed to exploit steeply dipping, narrow vein deposits, and allow mining crews to switch between hand-held and long bore-hole drilling techniques. Gold ore reserves located below the 8 Level will be extracted via a trackless mine fleet that will traverse between stopes along a series of small ramps.   

Majority of the ore will initially be derived from the Mystery and Dubbo sections.

The company has completed rehabilitation of the mine access road and hardstand area.

Analysis

With $634,069 raised from its entitlement offer, New Talisman Gold Mines remains on track for first production from its Talisman Gold Mines by the end of 2014.

This continues to demonstrate its potential to develop into a small scale producer with a gold resource EV approaching $58.32 per ounce as applied to A1 Consolidated (ASX:AYC), which is developing the A1 Gold Mine in North Eastern Victoria.

The project NPV of NZ$15.5 million (A$14.3 million) compares favourably with its current market cap. of circa NZ$8.5 million.

Proactive Investors had previously placed a Speculative Buy recommendation with a  6-9 month target of $0.021 per share.

 

Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX “Small and Mid-cap” stocks with distribution in Australia, UK, North America and Hong Kong / China.

No investment advice


Proactive Investors North America Inc, trades as "Proactiveinvestors USA & Canada".


You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.


You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.


From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.


You understand that we may be providing advertising and/or marketing services to companies mentioned on the site. A full list of companies that are paying for services from us, or our affiliated companies in the UK and Australia can be viewed here