WA Mt Palmer mine shines for Kula, Aurumin with one-ounce gold hits

Kula Gold and Aurumin Limited have continued to resurrect a forgotten gem in Western Australia’s Southern Cross Goldfields after hauling in another series of dazzling drill hits at the historic Mt Palmer mine.

The share price of Kula, which owns 80 per cent of the project, rocketed nearly 30 per cent to 0.009 cents on the back of the blockbuster drill results. The rise was fuelled by a surge of investor interest that saw close to 25 million shares change hands on the company’s biggest trading day in a month.

The latest stage two reverse circulation drilling campaign delivered some serious eye candy for gold bugs, with a standout shallow intercept of 3 metres at 35.9 grams per tonne (g/t) gold from just 17m, including 1m at a whopping 83.6g/t.

Other hits include 3m grading 29.7g/t gold from 37m, 2m at 18.1g/t gold from 23m and 18m at 1.9g/t gold from 22m, including a 7m section running at 9.4g/t.

The company says the sizzling grades - many from depths of less than 40m - and Mt Palmer’s strong geological fundamentals are building an early case for a low-cost, high-return open-pit operation at the site. 

According to management, the results are also just the tonic to support aggressive ongoing exploration efforts to delineate the longer-term development potential of a mine that once produced 150,000 ounces at 15.9g/t before World War II halted production.

Kula Gold managing director Ric Dawson said: “The latest stage two one-metre split assay results from Kula’s Mt Palmer gold project further substantiate the project's potential to deliver meaningful shareholder value through continued identification of high-grade gold mineralisation.”

Notably, the company believes that using a photon assay could be the secret to uncovering nuggety historically under-reported high-grade zones at the project. The game-changing technique can analyse 10 times more samples than traditional fire assay without destroying coarse gold in the process.

Across the project, the results are stacking up. Previous hits include 18m at 4.4g/t from surface, with a 2m punch of 31.3g/t, and 7m at 7.7g/t gold also starting from surface.

Kula says beyond the spectacular grades, the geological stars are also starting to align. Drilling has tapped into high-grade mineralisation, dubbed the New Lode beneath historic workings, where rich gold appears to be concentrated in fold closures. These can be classic structural traps for juicy mineralisation. 

New zones to the east of the old pit, such as the West Lode and Busey Shoot, are also emerging to offer a pipeline of fresh targets. The company says these lodes remain poorly tested, but early drilling hints at a solid upside.

Kula’s structural consultant Model Earth has now remapped the mine’s intricate geology, revealing stretched and shear-folded quartz veins broken into segments, which vary significantly between each hotspot but appear to control the plunge orientations of the gold mineralisation.

Mt Palmer sits in gold-rich real estate, a little north of the previously mined 600,000-ounce Nevoria gold deposit and east of the Chinese-owned 2.4-million-ounce Marvel Loch mine. 

With its latest results now in hand, Kula is busy putting the finishing touches on a diamond drilling campaign aimed at twinning high-grade reverse circulation intercepts to firm up structural models and refine future drill targeting.

If these results keep coming, helped along with a healthy dose of modern assay technology, Kula might be on to more than a few lost ounces. From a dusty relic of WA’s mining past, Mt Palmer is starting to look more like a golden opportunity in the making.

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