The Tennant Creek Goldfield: Small but High Grade
Tennant Creek is located 504 km north of Alice Springs and 978 km south of Darwin. It lies near an important crossroad in Northern Australia: the intersection of the Stuart and Barkly Highways. The Stuart is the only highway in central Australia that connects the north and south coasts. The Barkly connects the centre with the north Queensland coast.
Settlement commenced with the establishment of the overland telegraph in 1872. Alluvial gold was first discovered around 1879, but it wasn’t until 1932 that the gold rush really started. In that year visible gold was found within ironstone, a very unusual occurrence at the time because gold was usually associated with quartz.
This lead to prospectors swarming over any outcropping ironstone and many discoveries were made of both gold and copper. In 1934 the population was sufficient for the government to gazette a township. The population is now around 3,500.
Historical Mine Production
The Tennant Creek Goldfield is small by Australia standards. It has produced 3.3 million ounces from gold deposits and 2.2 million ounces (along with 488,000 tonnes of copper) from copper-gold deposits, for a total of 5.5 million ounces. It has also produced significant amounts of bismuth.
The largest polymetallic mine was Warrego, which produced 4.75 million tonnes at a grade of 8.0g/t gold, 2.0% copper and 0.3% bismuth. Peko produced 3.16 million tonnes at a grade of 3.5g/t gold, 14g/t silver, 4.0% copper and 0.1% bismuth.
The biggest gold mine was Nobles Nob, which produced 2.14 million tonnes at a grade of 17.0g/t gold. The highest grade gold mine was Juno, which produced 0.45 million tonnes at a grade of 57.0g/t gold, 7.0g/t silver, 0.4% copper and 0.6% bismuth.
There is a skewed distribution of size and production for both polymetallic and gold deposits at Tennant Creek. This is quite common in mineral fields around the world. It is significant because it means these deposits are in a geological setting that is the most amenable to metal deposition. This, in turn, implies that brownfields exploration is likely to be more successful in the immediate vicinity of these large deposits.
Geology and Mineralisation
The setting for mineralisation at Tennant Creek is complicated. Where mineralisation doesn’t outcrop, it has proven to be an elusive target. There is good reason for this, as is briefly summarised below.
The gold and copper-gold mineralisation (+/- bismuth, uranium etc.) is intimately associated with “ironstone”. At Tennant Creek ironstone refers to a variable mixture of hematite and magnetite. The ironstone was deposited first, without accompanying gold and copper, in zones of dilatancy. That is, in zones that have been structurally expanded and thus have more space between the rock grains to more easily accept introduced fluid.
The varying proportions of hematite and magnetite; sulphide, such as pyrite; gold; copper; and bismuth suggest that there have been several different phases of mineralising solutions being deposited(?). This has led to complex geological relationships that have made exploration targeting difficult.
Thus, a geophysical technique, such as magnetics will define magnetite, but be less effective in defining hematite; and a technique such as gravity should identify all ironstone. But, of course, there are numerous gravity/magnetic anomalies in the area that are not mineralised. Similarly, while dilational structures are probably a pre-requisite, they will not necessarily be mineralised.
Finally, because the ironstone is a precursor to mineralisation, and there have been multiple phases of mineralisation, it does not follow that gold and copper cannot be deposited without the presence of ironstone.
Four listed companies have significant interests in the Tennant Creek Goldfield. Brief details on each are provided below.
Exploration by all companies over the past 10 years or so has met with limited success. Although all four companies listed below have resources, they are small and of modest grade. No one has come close to finding another Warrego or Nobles Nob.
It is possible that such deposits have not been found because they do not exist. It is also possible that they do exist, but because the controls on mineralisation are complex and poorly understood, exploration has failed. Finally it is also possible that much exploration has been poorly planned and executed.
In my opinion Tennant Creek is a very tempting target, but has a difficult risk-reward profile.
|ASX:TRM||Truscott Mining Corporation Limited|
|Issued Shares||77.7 million|
|Market Capitalisation||$3.1 million|
|Cash End March||$0.132 million|
|Cash Burn March Quarter||$0.117 million|
|Resources, Inferred||111,300t @ 25.6g/t gold|
|Profile||Gold explorer entirely focussed on Tennant Creek. The resource has not increased, or even been referred to, since January 2012.|
|ASX:EXM||Excalibur Mining Corporation Limited|
|Issued Shares||4,368 million|
|Market Capitalisation||$4.3 million|
|Cash End March||$0.075 million|
|Cash Burn March Quarter||$0.158 million|
|Resources, Inferred||2.1Mt @ 4.1g/t gold1.0Mt @ 0.5% copper|
|Profile||Copper/gold explorer entirely focussed on Tennant Creek. Owns the two biggest historic gold producers, Nobles Knob and Juno|
|ASX:ERM||Emmerson Resources Limited|
|Issued Shares||261.0 million|
|Market Capitalisation||$12.2 million|
|Cash End March||$3.5 million|
|Cash Burn March Quarter||$0.909 million|
|Resources, Inferred & Indicated||1.48Mt @ 2.5% copper0.98Mt @ 1.4% copper & 2g/t gold|
|Profile||Copper/gold explorer entirely focussed on Tennant Creek. Holds projects in own right and in JV with Ivanhoe Australia Limited|
|ASX:MLX||Metals X Limited|
|Issued Shares||1,651 million|
|Market Capitalisation||$181 million|
|Cash End March||$76.9 million|
|Cash Burn March Quarter||N/A – EXM is a profitable tin producer|
|Resources, Inferred & Indicated||6.8Mt @ 1.7g/t gold, 1.2% copper, along with silver, bismuth and cobalt|
|Profile||The Tennant Creek assets are a minor part of the MLX portfolio. Planning an exploration decline.|