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D’Aguilar Gold has a proven record of successfully spinning off project-specific subsidiaries in order to maximise shareholder returns. Currently, one of D’Aguilar’s key projects is its rapidly developing AusNiCo nickel find, centred around Mt Cobalt in South East Queensland.
D’Aguilar managing director Nicholas Mather believes the project will soon become one of the company’s most valuable spin offs.
“We’ve discovered a new style of nickel mineralization at Mt Cobalt and at Ridleys, and we can now see the same sort of geological potential in a number of other areas of Queensland,” Mr Mather says.
“And this is going to be one of D’Aguilar’s most valuable spin outs in the future, and it’s going to start around Mt Cobalt, which is a beautiful pyramid-shaped hill. It’s got nickel oxide mineralisation all through it, and we’re very optimistic that that will give way to some sulphide mineralisation at depth.”
The appointment of Ian Levy as AusNiCo’s chief executive in July was a great boost for the project. Levy was formerly CEO of Tasmanian-based nickel explorer-come-miner Allegiance Mining. Mr Mather believes his appointment indicates the potential of D’Aguilar’s new spin off.
“He [Ian] built the Allegiance project in western Tasmania as the CEO from about a $40 million company to about a $700 million company,” Mr Mather says.
“So Ian’s a man of great achievement in an executive role, and for him to leave that project and come to one that’s starting from scratch with a new style of mineralisation, we believe speaks heaps about the project and it speaks heaps about how Ian can see AusNiCo developing as a company.”
Ian Levy expresses great excitement at the AusNiCo assets.
“Nickel is an extremely rare mineral and I’m excited by the possibility of creating a new nickel province,” Mr Levy says. “Since I joined in July we’ve drilled some very significant drill intercepts but more importantly we now have the geological model pretty much sorted out.
“Our business plan here is to create a significant business in two to three years. We’ve already found significant oxide occurrences and they justify the whole existence of AusNiCo. But if we can also turn up a nickel sulphide occurrence in this area, it would be extremely beneficial to the shareholders.”
AusNiCo’s exploration licences span more than 1000 square kilometres across south east Queensland. Exploration manager Neil Wilkins has been overseeing the day to day running of the exploration programme.
“We’ve done in excess of 1000 metres of percussion drilling and about 1000m of core drilling,” Mr Wilkins says. “The drilling so far has confirmed ore grades of nickel in two areas that we call Ridley and Mt Cobalt. It is very unusual to get in excess of 100m of depth of nickel mineralisation in oxide nickel and we know that it goes deeper.”
The drilling has also turned up unusually high grades of nickel, which in some cases is just two metres below the surface. Up to 4000m of further drilling in the New Year should give greater clarity to the extent of the resource, and Mr Wilkins believes the potential for further significant discoveries is strong.
“The AusNiCo project covers the ultra basic rocks that occur in this [Mt Cobalt] belt and also a similar one to the north west that has never been looked at before,” he says. “We only need a small part of those belts to come in with the results that we have here and we will have a very large project in two parts of Queensland.”
Following this intensive exploration, an IPO looks likely for the D’Aguilar subsidiary at the end of the first quarter 2008. Nicholas Mather says this will offer an exciting opportunity to existing D’Aguilar shareholders.
“We expect the company to grow very, very rapidly, and once we get it listed and public, the D’Augilar holding in AusNiCo will, we believe, be represented by a very valuable piece of equity. That will help support the growth in D’Aguilar.
“In addition to that, AusNiCo will be raising its own funds in an initial public offering and ASX listing, and anybody who is a D’Aguilar shareholder when we launch that will be entitled to take part in the AusNiCo IPO raising.”
Ian Levy believes the AusNiCo resource has the potential to grow, and to produce a very significant nickel project.
“A large nickel business is a business that owns 100,000 tonnes of nickel or more that they can recover. And if the nickel price was say $30,000 US per tonne of nickel, you’re talking about $3 billion,” Mr Levy says.
“It’s too early to say how much nickel we’ve got in the ground within AusNiCo right at this moment; resource studies will continue over time and the resource will continue to grow.
“But we are fairly confident in our order of magnitude. We’ve already got tens of thousands of tonnes of nickel within our known prospect areas and we certainly have large aspirations to locate much, much more.”
D’Aguilar managing director Nicholas Mather believes the project will soon become one of the company’s most valuable spin offs.
“We’ve discovered a new style of nickel mineralization at Mt Cobalt and at Ridleys, and we can now see the same sort of geological potential in a number of other areas of Queensland,” Mr Mather says.
“And this is going to be one of D’Aguilar’s most valuable spin outs in the future, and it’s going to start around Mt Cobalt, which is a beautiful pyramid-shaped hill. It’s got nickel oxide mineralisation all through it, and we’re very optimistic that that will give way to some sulphide mineralisation at depth.”
The appointment of Ian Levy as AusNiCo’s chief executive in July was a great boost for the project. Levy was formerly CEO of Tasmanian-based nickel explorer-come-miner Allegiance Mining. Mr Mather believes his appointment indicates the potential of D’Aguilar’s new spin off.
“He [Ian] built the Allegiance project in western Tasmania as the CEO from about a $40 million company to about a $700 million company,” Mr Mather says.
“So Ian’s a man of great achievement in an executive role, and for him to leave that project and come to one that’s starting from scratch with a new style of mineralisation, we believe speaks heaps about the project and it speaks heaps about how Ian can see AusNiCo developing as a company.”
Ian Levy expresses great excitement at the AusNiCo assets.
“Nickel is an extremely rare mineral and I’m excited by the possibility of creating a new nickel province,” Mr Levy says. “Since I joined in July we’ve drilled some very significant drill intercepts but more importantly we now have the geological model pretty much sorted out.
“Our business plan here is to create a significant business in two to three years. We’ve already found significant oxide occurrences and they justify the whole existence of AusNiCo. But if we can also turn up a nickel sulphide occurrence in this area, it would be extremely beneficial to the shareholders.”
AusNiCo’s exploration licences span more than 1000 square kilometres across south east Queensland. Exploration manager Neil Wilkins has been overseeing the day to day running of the exploration programme.
“We’ve done in excess of 1000 metres of percussion drilling and about 1000m of core drilling,” Mr Wilkins says. “The drilling so far has confirmed ore grades of nickel in two areas that we call Ridley and Mt Cobalt. It is very unusual to get in excess of 100m of depth of nickel mineralisation in oxide nickel and we know that it goes deeper.”
The drilling has also turned up unusually high grades of nickel, which in some cases is just two metres below the surface. Up to 4000m of further drilling in the New Year should give greater clarity to the extent of the resource, and Mr Wilkins believes the potential for further significant discoveries is strong.
“The AusNiCo project covers the ultra basic rocks that occur in this [Mt Cobalt] belt and also a similar one to the north west that has never been looked at before,” he says. “We only need a small part of those belts to come in with the results that we have here and we will have a very large project in two parts of Queensland.”
Following this intensive exploration, an IPO looks likely for the D’Aguilar subsidiary at the end of the first quarter 2008. Nicholas Mather says this will offer an exciting opportunity to existing D’Aguilar shareholders.
“We expect the company to grow very, very rapidly, and once we get it listed and public, the D’Augilar holding in AusNiCo will, we believe, be represented by a very valuable piece of equity. That will help support the growth in D’Aguilar.
“In addition to that, AusNiCo will be raising its own funds in an initial public offering and ASX listing, and anybody who is a D’Aguilar shareholder when we launch that will be entitled to take part in the AusNiCo IPO raising.”
Ian Levy believes the AusNiCo resource has the potential to grow, and to produce a very significant nickel project.
“A large nickel business is a business that owns 100,000 tonnes of nickel or more that they can recover. And if the nickel price was say $30,000 US per tonne of nickel, you’re talking about $3 billion,” Mr Levy says.
“It’s too early to say how much nickel we’ve got in the ground within AusNiCo right at this moment; resource studies will continue over time and the resource will continue to grow.
“But we are fairly confident in our order of magnitude. We’ve already got tens of thousands of tonnes of nickel within our known prospect areas and we certainly have large aspirations to locate much, much more.”
