PC Gold gets a Spring Hill in its step ahead of eagerly anticipated resource increase

The company, which owns the Spring Hill gold project in the Northern Territory, listed on the ASX in October last year after an initial public offering that raised A$13.5 million at A25c.

“As a newly listed company, I think people don’t realise that, in fact, we’ve been around for 10 years as a private equity-backed vehicle,” PC executive chairman Ashley Pattison told a recent event in Perth. 

“Most importantly, as a result of that, board and management have contributed most of the money – $25 million dollars-plus, still own 40% of this company – top 40 shareholders, 85%, and that’s predominantly institutionally based investors. 

“Very tight capital structure. Unfortunately, trade by appointment on some days, but still have liquid trading days.”

The company raised a further $24 million at 65c in February.

The stock is up by more than 350% since listing, trading at around $1.32 this week.

“What’s really driven that is drill success – over 30,000m drilled since we listed in October last year,” Pattison said. 

“90% of our holes hit economic mineralisation, 40% of those hit visible gold, and that’s what’s really driving the share price performance of PC Gold.”

The most recent drill hits from the high-grade Link Zone, reported this week, returned 9.5m at 3.04 grams per tonne gold from 189.6m; 6m at 5.16g/t gold from 209.6m; and 5.2m at 3.12g/t gold from 174m.

It follows an earlier result of 25m at 36.83g/t gold from 283m, reported in the March quarter.

Resource update imminent

Spring Hill already has an indicated and inferred resource of 25.6 million tonnes at 1g/t gold for 821,000 ounces of gold, based on a 0.5g/t cut-off, reported in 2024.

PC is putting the finishing touches on a resource update, which will capture the recent high-grade Link Zone discovery.

“The expectation obviously out there is for a very material increase in the resource,” Pattison said. “The mineral resource estimate was a starting point for us.

“We believe this is a five million ounce system, and we’re well and truly seeking to prove that during the course of this year and next year.”

PC has four rigs on site with around 40,000m of drilling planned over the remainder of the year.

The company also has a prefeasibility study on an open pit and underground operation due at the end of October.

“It’s a beautiful bulk-tonnage orebody, averages 50-60m wide,” Pattison said.

“Even that Link Zone structure is 15m wide and 140m below surface, so very easily accessible.”

In an initiation note published in March, Euroz Hartleys analyst Michael Scantlebury said the expectation was for the resource to more than double to around 1.7Moz, which would underpin a $350 million operation to produce 128,000oz per annum at all-in sustaining costs of $2500 an ounce over nine years.

Pattison said PC’s goal was to be in production by the end of 2028.

The project has a head start as it is already fully permitted, which took four years to achieve.

Last week, the company paid $770,000 for a 64-room accommodation camp, 30 minutes from Spring Hill, which is expected to result in major cost benefits when compared to permitting and building a new facility.

This week, PC acquired 68sqkm of adjoining tenure along strike and to the east of Spring Hill.

NT rockin’

The Top End only has a handful of operating mines but in the past six weeks, Arafura Rare Earths has approved its US$1.2 billion Nolans project, Hanking Gold pushed the button on its $500 million Mount Bundy project and Core Lithium approved the restart of its Finniss operations.

Pattison said NT chief minister Lia Finocchiaro was proactive and pro-mining.

“For those people that think the Northern Territory is off limits, that’s well and truly not the case,” he said.

The Pine Creek region, in which Spring Hill sits, is also looking increasingly interesting and ripe for consolidation.

“What we love about the region, is there’s 20 million-plus ounces in the Pine Creek region, two and a half hours south of Darwin,” Pattison said.

Agnico Eagle Mines holds dormant assets in the region, picked up via the acquisition of Kirkland Lake Gold, but has recently said it was considering a restart given the high gold price.

US-based Vista Gold Corporation holds the shovel-ready, 10Moz Mt Todd project nearby, while Mt Bundy sits to the north.

Patronus Resources also holds gold resources in the region.

“I told the market we’re very open to building a 3 million tonne CIL plant, and despite an unused one being down road that’s owned by Agnico Eagle, we are well and truly committed to a go-alone strategy,” Pattison said.