Dateline reels in huge gold hits to boost US-based mine

Dateline Resources drilling has reeled in two giant hits going 1 gram per tonne gold, including a richer zone of 10.7m of 8.17g/t, as it works to bring its Colosseum project in California’s San Bernardino County back into production.

The company says its first two diamond drillholes from the project’s North Pipe show 203.6m grading 1.03g/t gold and 192m running at 1g/t, confirming the potential for expanded mineralisation at the site.

The two holes are the first to be drilled by the company since its March campaign and have added to management’s structural understanding of the North Pipe. It says it not only validates historical data from the 1980s, but also shows higher assay grades than those previously recorded in its resource estimate.

Additionally, Dateline says the North Pipe mineralisation appears to be more evenly distributed when compared to the South Pipe – an important factor that will be incorporated into a scoping study that is underway. The study will assess the potential for both open-pit and underground mining methods.

The company also reported today that a $1.66 million shortfall from a recent capital-raising had been placed, concluding a successful $5.8 million raise and bolstering its balance sheet as it polishes off the scoping study required before any future development. The proceeds from the latest equity round is earmarked to fund further exploration, reduce debt and go towards general working capital.

Dateline Resources managing director Stephen Baghdadi said: “The results from the North Pipe have confirmed the previous drilling by BP in the 1980s, with significant widths of mineralisation intersected within the near-vertical breccia pipe structure. There remains considerable potential to extend these broad zones of mineralisation.”

Consisting of the North and the South Pipes, the Colosseum project was acquired by the company in 2021 from Barrick Gold, which at the time was jettisoning non-core assets.

With a colourful list of previous owners prior to Barrick’s tenure, the deposit had been drilled out to the tune of 55,000m by British Petroleum’s exploration arm, Amselco, and mined by Bond Corporation, which extracted 344,000 ounces of gold from the South Pipe. It eventually ended up in the hands of Lac Minerals, which was later absorbed into Barrick.

Barrick then sat on the deposit for nearly two decades, citing a slump in the gold price to US$350 (Au$518.15) an ounce for its inaction. But it believed just 300,000 ounces were left in reserves and it was too small to pursue.

When Dateline finally convinced Barrick to relinquish the asset in 2021, it immediately set about redefining the resource, eventually bringing it up to a 2012 JORC standard of 813,000 ounces in 2022. Further drilling earlier this year subsequently improved the global resource estimate to 1.1 million ounces, of which 736,000 ounces is in the measured and indicated category grading 1.26g/t, with some of those ounces going at more than 3g/t as verified by today’s reported high-grade section of 8.17g/t.

The Colosseum mine sits at the southern end of the Sevier foreland thrust belt in the Southern Basin and Range province. The deposit is a hydrothermal breccia pipe with a combination of epithermal mineralisation at original higher levels and mesothermal mineralisation at the lower levels.

Unusually for a gold project, the Colosseum deposit sits next door to the Mountain Pass mine, owned by Nevada-based MP Materials, that is America’s only large-scale rare earths project and is renowned as one of the world’s highest-quality deposits.

Dateline notes that Colosseum and Mountain Pass appear to sit along the same dyke and could potentially share some of the same rare earths.

World-renowned rare earths geological father-and-son duo, Tony Mariano and Tony Mariano Jr, have since visited Dateline’s project and have reported that there are some encouraging signs of rare earths-bearing structures. However, they have also sought to dispel the theory that Colosseum is a Mountain Pass-lookalike.

Further work will be undertaken to test the geochemical fingerprint at some stage in the future.

With its saddle bags now full of cash and a raft of new data to sift through as it moves towards scoping the project, Dateline appears to have jagged a previously unloved project that has literally been gathering dust in a back room somewhere in the bowels of a Barrick basement for 20 years. With the gold price riding high at about AU$3700 an ounce, the company may have got its timing pitch-perfect to be able to blow the dust off a deposit that well deserves a second chance.

Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au