GBM Resources Limited (ASX:GBZ) Managing Director Peter Rohner provides an update on the company's projects, discussing the JV with Newcrest Mining (ASX:NCM) and recent divestments.
Abbey Phillipps: We're talking today to the Managing Director and CEO of GBM Resources (ASX:GBZ), Peter Rohner. Peter, thanks for joining us, and welcome to the network.
Peter Rohner: Thanks, Abby. Thanks for the invite.
Abbey Phillipps: First up, for new investors, could you please provide an introduction to the company?
Peter Rohner: GBM is a gold exploration company and our main focus over the last three years has been the Drummond Basin assets in Queensland, where we've pulled together about 1.8 million ounces of gold. And then we've got some ancillary projects in Queensland and Cloncurry and a small operating gold mine in South Australia and some other tenements near Rockhampton, but the gold focus is where we're spending all our time and energy on.
Abbey Phillipps: Peter, could you tell us a bit about the history of the Drummond Basin?
Peter Rohner: Look, when I got involved in 2019, GBM had a small footprint in the Drummond Basin, and Peter Mullins and Steve Nano had spent a lot of time in South America looking at similar epithermal districts in Santa Cruz that turned out to be multimillion ounce deposits found in that district. So, we spent the last three years basically consolidating the Yandan Project area as well as tenements around Yandan and purchasing the Twin Hills asset off Minjar. We like the basin, it's very prospective and it's obviously a third party validation with Newcrest (ASX:NCM) doing the farm-in on the eastern part of our tenements. They wouldn't be coming into the ground if they didn't expect to find something significant. And also the basin over 30 years had a very fragmented ownership. The gold price was a lot lower in the early 2000s and all the owners were really looking for ore that could be trucked up to the Pajingo Mill that was owned in the northern part of the district. So, we're really pleased that we've got a very extensive land package there, and obviously we've got to fund expiration activities and that's partly why we brought Newcrest in.
Abbey Phillipps: What is the status of the Mount Coolon JV with Newcrest, and what's been completed so far?
Peter Rohner: So, Newcrest, we signed the JV last year and probably early this year they really hit the ground running. They've completed a large harmonisation of the assays, so historical samples that only had gold assays. They've assayed for all the other minor elements. They have started an IP program. They've completed about 30 line kilometres of IP surveys north of where we did a major survey in 2020. And they're doing soil lines across that IP program and they're doing a large aerial, aeromagnetic and radiometric survey across the entire tenement package. We're certainly happy with the volume of work they're doing. They've been spending a lot of time over the last six months working. They're using our field technicians on the programs and we're hopeful that they'll start drilling towards the back end of this year.
Abbey Phillipps: So, Peter, since the acquisition of the Twin Hills Gold project, the company has now identified several exploration targets. What geological, geophysical and geochemical work has led the company to identify these targets?
Peter Rohner: Yeah, look, we acquired the project from Minjar in 2020 and we sort of raced straight into a drilling program in the early part of last calendar year. We didn't have time to really sit back and look at all the historical data sets, which there was an enormous amount of data. It's had a, I suppose, chequered ownership history over the last 30 years. And most of the owners of the bulk of the Twin Hills package owned the Pajingo Mine, which is an operating plant to the north. They always were looking for higher-grade, surface, small open pit material that they could truck up the road. And we've basically had the last six months to really integrate all the techniques, review some of the old geophysical data, actually field test and field truth the prospects, and now we've identified some really compelling targets that obviously need drilling. Maybe a little bit more geophysical work around the Southern Sister, Lone Sister trend. But we're pretty excited about doing more work on the ground as the market improves and as asset sales provide some funding.
Abbey Phillipps: Adding on, what drilling plans are in place going forward for the Twin Hills project?
Peter Rohner: Look, in the short term, as I say, we're just firming up where we want to drill, and probably the drilling is a function of asset sales that are ongoing with White Dam and Mount Morgan. We're really leveraging at the moment the joint venture spend that Newcrest is doing in the Mount Coolon district. And our Japanese joint venture partners in Cloncurry are also looking to drill later this calendar year.
Abbey Phillipps: The company recently announced some tenement sales and alliances relating to White Dam. What was the rationale behind these activities considering GBM's plans to divest?
Peter Rohner: Look, with anything, it's a bit like sprucing up the house before you sell it. We like the asset, it's not core, it's generating some cash. The sale of a small tenement to Havilah (ASX:HAV) was really about a non-core tenement that had some minor potential, but gaining some access to some gold, copper potential resources just near our tenement boundary. And then the alliance with the owner of Portia is really about potentially toll treating some material that he has on site and providing opportunity for near-term revenue for both projects and maybe looking longer term at how that asset might fold together with White Dam with a potential buyer. We've certainly had interest on the asset, and I think the two assets potentially together might be a stronger proposition for an incoming purchaser.
Abbey Phillipps: What is the status of the company's remaining divestment program, and how will this assist in funding demands?
Peter Rohner: Obviously, White Dam, selling White Dam, will bring some additional funding into the business, which we'll redirect into the Drummond Basin projects. Look, we've done about $9m worth of asset divestments over the last three years. We don't want to just throw things overboard. We're trying to be respectful of shareholders' interests, and if we get the right price and the right deal, we'll sell that asset. The Mount Morgan spin out that we announced with Smartset some time ago that we cancelled earlier this year, we've got a process now to look at how that gets funded and move forward in its own vehicle.
Abbey Phillipps: Peter, thanks for joining us today. All the best for the future.
Peter Rohner: Okay, thanks Abby. Thanks for your time and thanks for the invite.
Ends
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