In late 2024, Alicanto, a member of the “Richardson Street” group of companies that also includes FireFly Metals and Andean Silver, appointed geologist and former Macquarie banker Ben Palich as head of corporate development to scour the globe for acquisition opportunities.
The company’s executive chairman is Ray Shorrocks, who was the founding chairman of Bellevue Gold and FireFly, and is also on the boards of stablemates Andean and Cygnus Metals, while FireFly managing director Steve Parsons is a consultant and major shareholder.
In November, the company appointed Regis Resources head of investor relations and external affairs Jeff Sansom as CEO, suggesting an acquisition may be nearing.
A week before Christmas, Alicanto announced the acquisition of the Mt Henry gold project, 22km south of Norseman in Western Australia’s Goldfields, in a deal worth up to A$64.6 million.
Alicanto will pay mid-tier producer Westgold Resources A$15 million cash and issue 357.1 million shares, worth A$19.6 million, which will give Westgold a 19.9% stake in Alicanto.
A further A$30 million will be due in cash or shares on the satisfaction of drilling, resource and project development hurdles.
The total value of the deal is worth more than Alicanto’s market capitalisation before it was announced.
Alicanto had just A$1.93 million in cash at the end of September but announced a A$28 million placeement to institutional investors to fund the acquisition.
Board, management and consultants committed to subscribe for A$2.4 million, with Parsons to maintain a 5.1% stake after the placement.
The two-tranche placement was priced at A5.5c per share.
Participants in that placement have already done well with the stock rising as high as A17c this week.
Shareholders will be asked to approve the placement, as well as a 12-for-1 share consolidation, at a meeting to be held on January 30.
Mt Henry
After completing the acquisition, Alicanto will have A$17.3 million cash to advance the project.
Mt Henry, in the Norseman Wiluna Greenstone Belt, has a resource of 24.5 million tonnes at 1.2 grams per tonne gold for 915,000 ounces of gold but has seen little exploration over the past 15 years.
The current resource is reported inside pit shells completed at an assumed price of roughly A$2169 an ounce.
Gold in Aussie dollar terms was nudging A$7000/oz yesterday, highlighting the opportunity and making it a great time to be a new gold story.
The project has produced around 100,000oz historically and was last mined in 2019. Ore was trucked 75km to Higginsville, then owned by Karora Resources, for processing, with recoveries averaging 82-94%.
The project comprises 67 square kilometres of granted mining leases prospecting licenses and has access to grid power and the sealed Esperance-Kalgoorlie Highway.
The three deposits, Mt Henry, Selene and North Scotia, sit within a 16km mineralised corridor and mineralisation remains completely open along strike and down-dip with clear potential.
Previous drilling in unmined areas has returned results including 18m at 16.4g/t gold from 14m; 19m at 9g/t gold from 29m; 64m at 3.9g/t gold from 65m; 39m at 5.2g/t gold from 100m; 18m at 9.8g/t gold from 1m, including 5m at 33.1g/t.
Results along the corridor outside the current resource include 10m at 88.2g/t gold from 5m, including 4m at 208.8g/t gold; 13m at 13.3g/t gold from 5m, including 3m at 41.8g/t gold; 2m at 46.3g/t gold from 6m; and 12m at 6.1g/t gold from 17m.
Almost all of the previous drilling has been in the top 150m, with depths outside the main areas averaging just 50m.
Alicanto is planning to kick off a 50,000 drilling campaign with multiple reverse circulation and diamond rigs this quarter, marking the first major program at Mt Henry since Kinross Gold’s work in the late 1990s.
The program will aim to extend known mineralisation and test new targets along the corridor.
Alicanto is planning two resource updates this year in the June and December quarters.
While the district, which has historically produced more than 150 million ounces of gold, hosts at least 14 other major gold projects, Alicanto’s focus will very much be to establish a new standalone gold mine.
