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Hosting rock formations more than three billion years of age, the Pilbara region of north-central Western Australia is one of the world’s most richly mineralised areas.
The Pilbara region also hosts Australia’s oldest granite-greenstone terrane known to exist on the continent. The rocks are so old that they are internationally significant.
This is a key reason why the Pilbara spurred the first WA gold rush back in the 1880s – there’s just nowhere else with rocks so likely to boast gold.
And the volume of gold the Pilbara has boasted is nothing short of awe-inspiring.
Since alluvial gold and gold nuggets were discovered at Whim Creek all the way back in 1887 (or even earlier) and since the Pilbara Goldfields region was established a year later on October 1, 1888, the area has seen in excess of 150 continuous years of gold exploration.
The importance of the area was recognised by the Commonwealth almost immediately upon the first official discovery. By 1891, a train line connected Marble Bar and Port Hedland – an impressive feat in those still early-settler days.
Gold and more
Consider also that the Pilbara is the heart of the iron ore export economy, that its coastal margins are home to some of the southern hemisphere’s largest oil and gas deposits, and that the Pilbara is now also a bustling lithium hotspot.
Base metal explorers continue to be attracted to the area, too. Nickel and copper are typical minerals of interest to local miners.
For miners, the Pilbara is a globally renowned hotspot that is widely desired, and having a good patch of land in the right area can be worth more than the metal you stand on.
All of this adds up to one impressive statistic: the Pilbara accounts for 19.2 per cent of WA’s entire GDP and 3.4 per cent of the entire country.
This is evidenced by the development the area has seen in the last one hundred years, with profits helping fund the development of Kalgoorlie-Boulder, Coolgardie, and Esperance, Broome, and other regional townships.
It’s no surprise then that Rio Tinto, Fortescue, and BHP all have long multi-decade histories in the region.
But gold still remains the crown jewel of the Pilbara.
A string of recent discoveries adding to Pilbara revival
In 2016, a prospector called Jonathan Campbell was flying a light aircraft over the Pilbara region when he spotted an old prospector’s camp down below. Despite expecting it to be long-tapped dry, Mr Campbell returned a time later to investigate.
What he found shocked those in the industry. That shock was the discovery of an 8-kilometre-wide area full of gold nuggets.
In recent history, gold nuggets weighing more than one kilogram have been discovered in the Pilbara.
But perhaps most crucial to a rejuvenation of interest in the area is De Grey Mining’s (DEG) Hemi gold discovery, the most recent massive deposit set to give Australia’s big miners a run for their money.
Importance of Hemi
In December 2019, a company called De Grey discovered a massive gold deposit system in the Pilbara on a scale that hadn’t been seen in years.
Called the Hemi deposit, the discovery sits in an Archean-age setting in the Pilbara Craton, a larger geological formation that boasts the world’s oldest rocks, enveloped by a permit boundary some 2500 square kilometres in size.
The gold is intrusion-hosted style mineralisation, which refers to rocks that have formed from ancient molten magma rising from the centre of the planet, becoming trapped, and cooling down. This happens over millions of years – in the Pilbara’s case, billions.
Once cooling commences, that magma becomes crystalline, and in the right conditions, that is how mineralisation forms. This is as true of commercial minerals like gold and lithium as it is of perhaps less tantalising materials like quartz.
Why is an intrusion system so special?
Hemi is so significant because it’s the first discovery of its kind in the Pilbara. That specific style of gold mineralisation has been largely considered not typical of the Pilbara.
Then, De Grey proved everybody wrong back in 2019.
Intrusion system gold is better understood by geological science and easier to mine if the depths are attractive, and given that gold nuggets are still being discovered in the Pilbara in the modern era, it implies that there’s more out there we haven’t found.
De Grey’s movement to the area has caused as many eyes to turn towards Pilbara landholdings as has the lithium rush.
Where is it?
The Hemi deposit is located about 60 kilometres south of north WA’s largest deepwater marine hub, Port Hedland.
Geologically, the project is located in the Mallina Basin, a well-known but previously unrecognised formation for gold mineralisation on a massive scale.
The Mallina Basin is one of the most mineralised parts of the larger Pilbara Craton. But only in the late 2010s did De Grey discover the Mallina also hosts intrusion-style igneous deposits, meaning they are some of the oldest gold deposits on the entire planet that have ever formed.
The size of Hemi should also be noted: just in June this year, De Grey upgraded its mineral resource for the Hemi deposit to 9.5 million ounces of gold.
The company’s whole-of-project Mallina Gold Project estimate is higher at 11.7Moz, but Hemi has more than the lion’s share.
But De Grey isn’t the only company set to benefit from the Mallina Basin.
Then there’s Mantle Minerals
Mantle Minerals (MTL) has restarted gold exploration at its Robert’s Hill project, also in the Mallina Basin region of the Pilbara.
In fact, it’s basically on the doorstep of the Hemi deposit. Mantle Minerals’ Robert’s Hill acreage is only five kilometres to the northwest of De Grey’s Mallina gold project.
Mantle states it is on the cusp of discovering Hemi-style gold mineralisation, with early evidence strongly indicating this is highly possible. Robert’s Hill sits in the Mallina Basin in a virtually unchanged style of host rock.
Mantle Minerals also found a four-metre-thick intersection of gold in early-stage drilling in 2021. The mineralisation, Mantle confirms, is Hemi-style. This is further added to by the low arsenic counts it picked up, which are replicated at Hemi.
The company is now conducting geochemical works ahead of a drill run set for the second half of 2023. All things in order, that will kick off in September.
The company’s Executive Chairman, Nick Poll, has previously told The Market Herald his vision for Mantle is for the company to replicate De Grey’s success at Hemi. Mr Poll has worked in mining geology for three decades, and he formerly sat at Mirabela Nickel as Managing Director for six years.
During that time, Mirabela’s market cap grew to more than $1 billion.
Mantle shares are cheap, for now
Like Mantle, De Grey initially had results that nobody paid much attention to.
Then they discovered a mammoth igneous gold system only five kilometres south of where Mantle Minerals is now setting up shop.
With Mantle shares at a significant discount to De Grey’s share price, the company offers a tantalising value proposition to investors.
The results of an upcoming 15,000-metre drill run will likely drive a large wave of attention in Mantle, and if those results are as good as management expects, it’s not hard to predict where investors will park their money.
