Golden Blocks

Key highlights

  • Project covers entire 25km2 historic goldfield on the South Island of New Zealand.
  • Virtually untouched for over 100 years with records lost from public knowledge.
  • Archived records discovered by the Company revealed the true potential of the goldfield.
  • Over nine sites of historic gold workings with total production of 46,000 ounces.
  • High grade, underground free milling gold.
  • 2.5km ‘gold corridor’ of mineralisation.
  • The Aorangi Mine at Golden Blocks closed in 1914 due to shortages of labour with the outbreak of war led to flooding of underwater levels.
  • Produced approx. 26,000 ounces with gold production stopped at high-grade of 66 g/t.
  • Further mining and exploration attempts blocked by old English Estate land owners.
  • Archived records show last reported assays of 663.8 g/t gold over 0.75m including 5324.5 g/t over 0.25m in 1932.
  • No drilling or even basic soil sampling.
  • 100% owned by Strategic Materials.

A virtually untouched 100 year-old high-grade goldfield

The Golden Blocks project in the South Island of New Zealand covers the entire historic Golden Blocks goldfield.

Despite being known for its bonanza-grade gold production, it has remained virtually untouched for a century.

Globally there are very few gold projects that provide investors the opportunity to participate in such a high-grade gold opportunity as Golden Blocks.

In gold mining, grade is one of the most critical factors. Most gold mines today have an average grade of just 1.01 g/t.

However the Aorangi Gold Mine at Golden Blocks stopped production at a grade of 66g/t in 1914. Further, the last company to explore the Mine reported assays of 663.8 g/t gold over 0.75m including 5324.5 g/t over 0.25m in 1932.

Over five producing mines (untouched since 1914) are spread across a 2.5 km gold corridor that has never had modern exploration including drilling or even basic soil sampling.

Strategic Materials owns 100% of the permit over the entire 25km2 Golden Blocks goldfield.

The Aorangi Gold Mine was the largest mine in the goldfield. Archived records reveal an exceptionally high average head grade of primary ore at 46.9 g/t. As noted, the current average grade of a modern gold deposit is 1.01 g/t. Government mining inspectors reported gold continuing beneath the mine.

Over 2.5 million ounces of gold was produced to the south from the Reefton and Lyell Goldfields. Golden Blocks is considered by many to be the northern extension of these goldfields where gold was mined down to a depth of 710m at the Blackwater Mine. However modern drilling indicates this extends to at least 1.5kms below the surface. Historic production from Blackwater was 740,000 ounces of gold.

By comparison, the Aorangi Gold Mine was only mined to a depth of 130m. Last recorded production was at 66 g/t with no evidence of faulting or fading. In fact, some reports indicate the grade was potentially increasing at depth.

The gold from Aorangi Gold Mine was free-milling and easily recoverable. The Mine is situated within trucking distance to operating gold mills.

The Company believes it is the first to enter the Mine since the 1930’s.

 

Records of Underground Exploration in 1931

Previously, accepted public record was that no attempt had been made to re-open the Aorangi mine since it closed in 1914. However, archived records discovered a little-known effort to re-open the goldfield in 1932 by local company Golden Blocks Mines Ltd (GBM), a successor company to New Taitapu Gold Prospecting Company Ltd (NTC).

It is now clear that No. 3 Level of the Aorangi mine has approximately 300m of completed underground development left unmined since 1914.
Over 17 years after the mine closed, NTC drove into this section of the mine successfully cutting through a vein grading 663.8 g/t over 0.75m across the full width of the quartz, including 5324.5 g/t over 0.25m.

Importantly, the stone around the shoot was also said to be “exceptionally good.” An extensive effort was made to validate the NTC results, with the Company successfully tracking the actual laboratory assay sheets from this underground work to the Thames School of Mines, now a mining museum in Thames, New Zealand.

Archived records contained in the Wellington Archives also increase support for gold mineralisation to extend beneath the previously mined levels. Exploration in 1932 by NTC successfully tested for gold beneath No. 3 Level by sinking into the floor of the unmined level. They reported, “gold showing” in their workings.

Independent Reports

Archived records also included a 1933 independent report from highly distinguished New Zealand geologist Dr James Park, a former Director of the Thames School of Mines, who worked globally for Anglo-Continental and became a Professor Emeritus.

Dr Park reported on the potential of gold continuing at depth beneath the old mine, stating “Clearly the future of the mine depends on continuation of values in depth.”

“From what I know of the history of this mine and the undoubted favourable geological conditions there is, in my opinion, warrant for the belief that valuable ore shoots may be looked for in the deeper ground”.

Strategic Elements’ wholly owned subsidiary Strategic Materials (the Company) was granted the prospecting rights for Golden Blocks in October 2012, making the Company one of the few modern day explorers within the area due to the fact that until recent times, the mineral rights and the land were privately held.

The strategy at Golden Blocks was to apply modern exploration techniques to the goldfield. Despite the high yields from the mines and that fact that the area was mined for gold (alluvial and hard rock) it had never been properly understood from a geological perspective.

Following the work of Corner and Jennings (1994) and submissions from the Ministry of Commerce and the minerals industry, the Golden Blocks goldfield was excluded from the Kahurangi National Park. In the Corner and Jennings report, the technical consultants stated:

“There has been no drilling, detailed geological mapping or sampling in the Aorangi mine area. The few brief field inspections made in recent years are totally inadequate to define the ultimate resource potential of these deposits.”

Over the first two years, the Company has conducted the first comprehensive program aimed at opening up the goldfield for the first time by combining modern technology, targeted field programs and the wealth of historical data available.

Our Approach

The Company deliberately pursued an exploration strategy that could utilise all the rich historical data in addition to the data collected by the Company. Historic documents contained vast amounts of valuable information regarding the nature of mines, their reef systems and the high-grade shoots that were mined, additionally the Company conducted numerous field programs which included detailed inspections of workings and the collection of over 200 samples across the permit.

Results

The “Target” Defined

The Company believes that the opportunity within Golden Blocks is to identify additional high grade narrow vein reefs, either to the south along strike or parallel to the Aorangi reef. Narrow vein high grade reefs are characterised by high grade and low grade gold, parts of the Aorangi reef have been as rich as 7750 g/t in some veins down to under 1 g/t in other places. The Aorangi reef has repeating high-grade chutes which follow the reef from the surface down to the lowest levels.

Exploration Focus on South of Mine

Moving forward, the Company plans to focus its efforts to the area south of the Aorangi mine.

Aorangi to Sandhills Creek – In 1900 exploration teams operating in the area south of the Aorangi mine reported that they had traced the Aorangi reef approximately 500m (25 chains) by trenches 18m (60ft.) apart. One trench was 6 metres wide and assayed 1.94 g/t from surface across the 6 metres. Other sections returned surface assays up to 4.7g/t. This prospecting was within the area south of the Aorangi mine to Sandhills Creek.

Sandhills Creek to Webb Stream – The Company looked beyond the 500m traced in 1900 to the area beyond Sandhills Creek, further south to Webb Stream, over 4km to the south of the Aorangi mine. High grade gold was found within Webb Stream, pan concentrates returned up to 51 g/t. Whilst it is not known if the Aorangi reef continues to Webb Stream additional untested favourable structural targets were identified in this area.

Next Steps

As a result of the cumulative work to date, the Company has resolved to conduct a drilling program targeting the potential continuation of the Pioneer Shoot being mined on Level 4 in 1914 when the mine closed due to water, gas and labour shortages. High-grade ore was mined from the internal incline shaft down from Level 3 and on Level 4 itself.

Exploration assays from within the 200m of unmined workings left in Level 3 of the mine contained gold grades of 663.9 g/t over 0.75m including 5342.5 g/t over 0.25m. Unmined stone around this shoot was also exceptionally good. Gold was also showing in the floor of Level 3 and government mine inspectors believed that the reef continued at depth and that valuable ore shoots may be looked for in the deeper ground.

Through its sampling and mapping programs with a number of consultants and insight gained from numerous field trips, the Company is confident that higher grade gold in any potential continuation of the Pioneer Shoot would be contained within a shale unit named the “Mine Bed”. Fieldwork confirmed that the Mine Bed should be easily recognised in drill core as it is consistently positioned between much lighter sandstone and siltstone units.