Orion Gold NL (ASX: ORN) advises that nickel exploration programs are about to commence at its Fraser Range Gold-Nickel Project in Western Australia following the completion of key acquisition agreements. The Company also provides an update on recent drilling programs at its Walhalla Gold-PGE Project in Victoria.

Fraser Range Gold-Nickel Project (Western Australia)

On 22 March 2013, Orion announced that it had entered into a binding heads of agreement to acquire all of the shares in unlisted company Kamax Resources Limited. The agreement will result in Orion acquiring exploration licences covering more than 913sqkm in the Tropicana Belt and Fraser Range Province of WA and 669sqkm of additional applications in the two belts. Orion has now completed its due diligence and executed all agreements relating to the acquisition, and has received 100% acceptance from Kamax security holders for the offer.

The Company is holding a shareholder meeting on 13 June 2013 to seek shareholder approval for the issue of Orion shares and options to Kamax security holders for settlement of the acquisition.  Importantly, Orion’s major shareholder, Silja Investment Ltd (which has a holding of approximately 60% in Orion), has confirmed its intention to support the acquisition. Orion has contracted Fugro Airborne Surveys to immediately mobilise and conduct a HeliTEM survey across the nickel-focused Peninsula prospect.  Mobilisation to site has commenced with the survey anticipated to be completed in early June.

The Kamax Fraser Range tenements are located between two world-class discoveries, the Tropicana Gold Project to the north, owned by Independence Group and AngloGold Ashanti, and the Nova Nickel-Copper-Cobalt Project to the south, owned by Sirius Resources. Nickel exploration was carried out by Western Areas NL at the Peninsula Project between 2000 and 2006. This exploration pre-dated Sirius Resources’ recent world-class Nova discovery and has not been re-interpreted in that context, although Peninsula is one of the few confirmed differentiated mafic intrusives in the Fraser Range geological province, with a similar rock composition to Nova.

Airborne EM was a key tool in the Nova discovery and the Company believes that its application at Peninsula will yield critical information to add to the substantial data already available for the Project. Scout RC drilling by Western Areas in 2005 yielded intersections of gabbronorite and other mafic units which were interpreted as a layered, differentiated mafic intrusive. Western Areas interpreted the mafic complex to be approximately 13km long and 5km wide.

Drilling also returned individual nickel values >0.1% Ni in three holes (Figure 3). Significantly, while aeromagnetic and ground gravity data was collected, no EM surveys (airborne or ground) were carried out. Importantly, the ground gravity survey identified an anomaly which has not been explained by previous drilling. The Company has engaged Southern Geoscience to monitor QA/QC of data acquisition and interpret the results of the HeliTEM survey which, it is hoped, will identify conductive bodies such as massive sulphide accumulations within or on the margins of the mafic intrusions. This will provide further detail about the layering and other magmatic features present within these intrusions.