Alchemy Resources uncovers high-grade gold in phase one campaign at Karonie Gold Project, shares up

Alchemy Resources Ltd (ASX:ALY) is trading higher on tabling a suite of high-grade gold results after completing a reverse circulation (RC) campaign at its Karonie Gold Project east of Kalgoorlie in Western Australia. The precious metals explorer has now received assays from all 27 holes drilled across its wholly-owned project’s Taupo, KZ5 and Parmelia gold prospects. During the phase one campaign, Alchemy uncovered wide zones of mineralisation along strike and both up and down-dip of existing gold zones at all three areas of interest, with a strong result of 12 metres at 1.26 g/t gold from 24 metres, including 8 metres at 1.41 g/t from 24 metres. Primarily, fresh assays have extended the gold mineralisation at KZ5 to 500 metres — a promising sign as the company looks to generate maiden resources across each of the prospects. Shares have been as much as 30% higher in early trade to 1.7 cents. Now, Alchemy is gearing up for another round of drilling at the WA project, with 3D modelling, surface mapping and rock chip sampling underway to inform future campaigns. A project with potential Alchemy Resources chief executive officer James Wilson said Karonie continued to emerge as a very exciting project for the explorer. “This recent round of drilling has extended mineralisation at KZ5 to around 500 metres of strike as well as opening a potential new zone of mineralisation to be tested in the northwest section. “At Taupo we’ve extended mineralisation to 150 metres down dip with some high grades in the central part of the deposit, which is a fantastic outcome. Mineralisation remains open at depth and along strike at all three prospects so its early days of testing what appears to be multiple significant mineralised systems. “Our understanding of these systems has advanced significantly and will be utilised in planning for our next phases of drilling. We will now look to re-sample the four-metre composites and to commence 3D modelling these zones, with a view to potentially calculating a maiden resource later this year. “In addition, we have detailed reconnaissance surface mapping underway in the areas to the north and south of Karonie which will form part of the next phases of drilling commencing later this year. "This dovetails in with our strategy of an aggressive 10,000-metre to 20,000-metre drill program over three phases across the tenement package at Karonie”. The phase one campaign Drilling at the Karonie Gold Project took place over three distinct prospects; the Taupo, KZ5 and Parmelia zones. At each of the prospects, RC drilling was designed to infill previous drilling and test strike extensions to the existing mineralisation envelope. At Taupo prospect, drilling results have confirmed the mineralised structure's continuity in an area known as the central zone, where one drill hole intersected four metres at 1.72 g/t gold from 123 metres, including 1-metre at 5.73 g/t from 123 metres. Over at KZ5, apart from the 12-metre intersection, one hole returned 4 metres at 3.39 g/t from 56 metres, targeting the up-dip extent of mineralisation observed in a previous hole. Following work at this gold zone, Alchemy believes there is significant opportunity to test the structure to the northwest, where historical drilling is both wide-spaced and shallow, and most holes have been drilled to 10 metres or less. Finally, at Parmelia prospect, RC assays have confirmed the region’s mineralised structure extends both down-dip and along strike to the south, with assays ranging from 0.3 g/t gold to 0.83 g/t over widths from four metres to 20 metres. Alchemy posits the Parmelia mineralisation may occur as a series of steeply south-plunging shoots over a strike length which now exceeds 500 metres. This theory will be tested in follow-up drill programs. Additional drilling at Karonie’s Warrior prospect returned as much as 0.66 g/t gold over four metres. Future programs As it prepares for phase two and three drill campaigns at the WA project, Alchemy has kickstarted detailed surface mapping across Karonie’s southern areas. It’s hoped this activity will provide the ASX-lister with a better understanding of the region’s mineralisation ahead of a phase two drilling program across the Challenger, Batavia, Gilmore, Esplanade and Aldiss prospects. Historically, wide-spaced RC drilling has intersected as much as 39.07 g/t gold at the Batavia prospect. Alchemy believes that there is scope to follow up these zones and assess their potential to host short strike length high-grade structures. From there, a phase three drill program over Karonie’s Claypan Shear Zone will kick off. This area has seen only limited modern exploration, with just four lines drilling over the region’s 35 kilometres of strike extent.