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- Orange Minerals (OMX) is one of the latest listed businesses to join the ranks of gold hopefuls hoping to capitalise on the revered New South Wales Lachlan Fold Belt
- The belt has a rich history of gold production, having been home to several prolific discoveries and mining operations over many decades
- Some of the most prominent gold projects in the area include Newcrest’s (NCM) Cadia-Ridgeway mine, Evolution Mining’s (EVN) Cowal mine, and CMOC’s Northparkes mine
- Orange’s primary focus in the Lachlan Fold Belt is its Calarie project, from which the company has recently reported high-grade assays from first-phase drilling work
- With a sound strategy, an experienced management team, and an impressive list of neighbours, Orange Minerals (OMX) may be a significant growth opportunity for the ASX minerals sector
Location is everything in the minerals exploration sector.
The best equipment, strategy, and funding in the world can be fruitless if an exploration company digs holes in the wrong spot.
It’s for this reason explorers often spend considerable time and money scouring through historical reports, surveying strips of land, and sampling specific areas for exploration before a drilling rig ever touches the ground.
While there’s certainly no guarantee that success at one exploration site means the surrounding area will be equally prolific, history has proven that mineral systems under the ground are often far larger than they initially seem.
As such, mining companies tend to flock to areas surrounding a recent discovery, and they stick around if the ground looks promising. This is precisely what is happening in New South Wales’ Lachlan Fold Belt.
Who’s who in the Lachlan Fold Belt
The thousand-kilometre-wide Lachlan Fold Belt spans across the border of New South Wales and Victoria and has a rich history of mineral production.
Decades of exploration have proven the area to be abundant in precious and base metals, with copper and gold the most prominent. Moreover, the belt has been home to several valuable historical discoveries and a number of world-class mining operations.
Not least among these is the Cadia-Ridgeway mine, owned by ASX gold darling Newcrest Mining (NCM). The world-class operation has a measured and indicated resource estimate of 2.9 billion tonnes at 0.36 grams of gold per tonne (g/t gold) for 33 million ounces of gold.
In the 2021 financial year, Cadia produced close to 765,000 ounces of gold and around 106,400 tonnes of copper.
Also nearby is CMOC’s Northparkes copper and gold mine, which has been operating for almost three decades and has pumped out over 1.17 million tonnes of copper and 1.46 million ounces of gold over its lifetime.
Alkane Resources’ (ALK) Tomingley Mine is another producing mine in this region, having helped lift Alkane’s share price from less than 30 cents per share for most of the late-2010s to over $1 a share today.
From Tomingley, Alkane has mined more than 7.9 million tonnes of ore and produced more than 470,000 ounces of gold.
This is not to mention the world-class Cowal open-pit operation, operated by Evolution Mining (EVN) since 2015.
Evolution expects to produce between 230,000 ounces and 250,000 ounces of gold from the Cowal mine over the 2022 financial year even as it works to build the project to a 350,000-ounce-per-annum operation.
The Lachlan Fold Belt has a history of successful mining, and it’s certainly not finished yet.
One of the latest companies to join the ranks of gold hopefuls hoping to capitalise on this revered NSW region is Orange Minerals (OMX), with a portfolio of assets in the Lachlan Fold Belt including the Calarie and Wisemans Creek projects.
OMX’s promising tenements
Orange’s primary focus in the Lachlan Fold Belt is its Calarie gold project, owned in a joint venture with Godolphin Resources (GRL). Godolphin is also the current owner of the former BHP Mount Aubrey project.
Orange has recently reported some impressive assay results from a first-phase drilling program at Calarie, including a 21-metre hit at 4.5 g/t gold from 34 metres. This intersection included a one-metre zone at a whopping 48.77 g/t gold.
Results like this, the company said, validate the “outstanding” historical results in the region and confirm mineralisation remains open both along strike and at depth at Calarie.
Meanwhile, Orange is gearing up to kick off a 600-metre diamond drilling program at the nearby Wisemans Creek project before the end of April. This drilling is also designed to follow up on excellent historical results.
Led by industry veteran David Greenwood, the OMX team believes it has snapped up a great opportunity in the Lachlan Fold Belt and, importantly, the company plans to stick around.
Gold that stays gold
With a global push for battery metals and minerals that support the worldwide shift to electric vehicles, lithium has stolen the spotlight in recent years across the mining industry.
Every mining company wants a piece of the lithium pie given the surge in demand for the metal over recent years, but this has often come at a cost to investors.
Across the global mining sector, would-be explorers of gold, copper, and other traditional metals are abruptly changing tack and chasing after lithium and rare earth elements (REEs) instead.
This means investors that may have bought into a company in the hopes of supporting the development of a gold mine, for example, are instead shunted into the battery metals industry unless they sell their shares.
Orange Minerals has made it clear that gold and base metal exploration is its focus: investors who support the company need not fear a step-change to another industry.
With a sound strategy, an experienced management team, and an impressive list of neighbours in one of the world’s most prolific regions, Orange Minerals (OMX) may be a significant growth opportunity for the ASX minerals sector.
The company operates with a manageable $11 million market cap and had $6.1 million in the bank to fund exploration at the end of March.
OMX shares last traded for 13 cents each.
