The Aussie gold junior drilling among rich deposits and big names in South America

One of the most eagerly watched gold exploration programs around has just kicked off in Guyana, northern South America.

It is being conducted by ASX-listed Altair (ASX:ALR) at its Greater Oko project in the Guiana Shield, a gold exploration hotspot and a geological analogue to West Africa’s gold-rich Birimian Shield.

More to the point is the exploration success that Canadian companies, which understand the Birimian, have been enjoying in the Oko region, with recent multi-million ounce discoveries prompting a string of merger and acquisition deals.

Altair is only just drilling its first holes after acquiring up to a 70% interest in the Greater Oko project last August.

But it nevertheless has an (undiluted) market cap of $278 million which goes to the earlier point that as far as maiden exploration drilling programs go, Altair’s program at Greater Oko is being keenly followed by the equity market, and the industry more broadly.

There are some nice historical exploration results at one of Altair’s Greater Oko projects (85m at 4.81g/t from 24m and 63m at 2.25g/t from 55m at the North Peters prospect area) which could be a taste of what is to come.

And then there is the investor and corporate interest flowing from the recent corporate activity among Altair’s Canadian neighbours in the region.

The TSX-listed G Mining Ventures (GMIN), a C$14.7 billion company, has just wrapped up a friendly C$3 billion acquisition of fellow Canadian G2 Goldfields. And before that deal, GMIN acquired another Canadian company, Reunion Gold, for C$1 billion.

The takeover action consolidated ownership under GMIN of two adjacent gold projects, Oko West (discovered by Reunion) and G2’s Oko-Ghanie discovery.

The projects have a combined gold resource base of more than 9 million ounces, discovered in the space of three years from a 5km section of the Oko shear zone, giving the region its hot-spot status.

The combination of Oko West and Oko-Ghanie is now being optimised for the single development of a 500,000oz-plus operation, with that level qualifying the project as world-class.

Altair is in the thick of the action thanks to its deal last August which delivered it a 15km section of the prospective Oko shear zone immediately south of the consolidated GMIN project, with Oko West 1.5km from the boundary with Altair’s ground and Oko-Ghanie some 3.5km along strike.

Altair is calling its two prospect areas South Oko (SOKO), and North Peters, 34km to the west.

After dealing with delays forced by a monster wet season in Guyana, North Peters is the first to be tested with the drill bit (5,600m in diamond holes and 2,000m of RC drilling), with SOKO to follow (15,000m of RC drilling).

The all-up 22,600m campaign is very much a Phase 1 program, with Altair’s treasury of $38 million enabling the company to maintain exploration momentum across the project area. The reason for the swollen treasury is simple enough.

Again before Altair drilled a hole, the US$11.7 billion LSE-TSX-listed Endeavour Mining became a 9.9% Altair shareholder by taking up a $28.2 million premium placement in the stock, announced in April.

Altair and Endeavour have also formed a technical committee to oversee the exploration of Altair’s Oko ground. So it can be said Endeavour – the biggest gold producer in West Africa from geologically similar rocks - is a fan of the upside potential of Altair’s ground.

Endeavour hasn’t said so but industry chatter has been that it was an under bidder to GMIN’s takeover of G2 Goldfields. Its decision to take up a stake in Altair is a demonstration of how keen it is on the potential for more multi-million ounce discoveries in the Oko region.

It’s not alone. The London-based resources investment group La Mancha has position in both GMIN (19.9%) and Endeavour (11%), with the GMIN stake recently increased to the current level while the Endeavour stake has been trimmed.

The La Mancha moves stand as head scratcher events given the two companies it is invested in are going head to head in the same region. From Altair’s point of view, it is a dynamic that gives the stock a situational overlay, one that could well get interesting once it begins to roll out drilling results.

Sky Metals (ASX:SKY):

It has got to be wondered if the equity market has become blasé about the impact on mining projects of the broad advance of metal prices metals in to record territory.

Tin is a good example. It is up by near on 10% in the last month to US$55,818/t which compares with its average in CY2025 of US$31,000/t.

Even so, ASX tin equities have been left by investors to merely plod along.

Norm Seckold’s Sky Metals (ASX:SKY) is a prime example.

Early in the week it released a preliminary feasibility study that confirmed its Tallebung tin-tungsten-silver project in central NSW was set to become a high-margin producer. But it has traded flat to lower since.

Based on a US$45,000/t tin price and equally conservative prices for the by-products of tungsten and silver, the PFS estimated a pre-tax net present value of $438m for an initial 7.3-year mine life producing an average of 2,040t of tin annually after capex of $138.8m, with annual EBITDA of $115m.

Plug in spot prices and the pre-tax NPV takes off to $1 billion and the annual EBITA comes in at more than $221m.

It was interesting stuff – at base case prices or spot prices - for a company that was trading at 22c a share in Thursday’s market for a market cap of $218m.

That is particularly so when the PFS flagged that mine life could be extended by four or five years once Sky shifts 11Mt of inferred material in to the measured and indicated category through infill drilling, boosting the project’s NPV.

The PFS was very much a starting point, with Sky now setting out to optimise the project ahead of expected mining approval late next year and first production in mid-2028.

The metals mix at Tallebung makes it a three critical metals mines in one scenario, something that should make the project appealing to strategic funding and offtake partners, keeping shareholder dilution to a minimum.

Bell Potter said it anticipated strong interest from potential strategic partners, government agencies and debt financiers given Tallebung’s scale, low-cost position and critical minerals exposure. The broker increased its risked valuation on the stock to 40c.

Sky is more than Tallebung. As mentioned here previously, it also owns the Doradilla tin project out the back of Bourke in north-west NSW.

It’s a big body of mineralisation that has long been known about. But it has taken a metallurgical breakthrough under Sky to bring it in from the cold.

Drawing on Doradilla’s historical database and its own work, and in light of the metallurgical success, Sky has been able to report a compliant “Exploration Target” of 10-15 million tonnes grading 0.32-0.42% tin for 32,000-63,000t of contained metal.

The target is based on a 2.5km section of Doradilla and there is another 2.5km of strike length on either side. So potentially at least, an already big exploration target could eventually be tripled.

As it was, Sky managing director Ollie Davies gave investors on the call for the release of the Tallebung PFS something to look forward to at Doradilla while the push towards production at Tallebung continues.

“We have an absolute giant up there near Burke in New South Wales,” he said.

Davies said the project had phenomenal potential and could well become the largest undeveloped tin project in the world.

“We look forward to getting up there and doing some more drilling shortly.’’