RESOURCEStocks: You recently joined Golden Mile Resources. You have a long history in the exploration business, including starting out in nickel and gold with WMC in WA, as well as experience in other parts of Australia and around the world - in the Philippines, US, New Zealand, among other places. Firstly, have you had earlier exposure to the main Golden Mile properties, or at least an awareness of them/their potential, in the course of your career?

Lachlan Reynolds: I started with Golden Mile Resources only a few weeks ago and had not been closely following the company until fairly recently. Because of my experience in the WA goldfields and being based in Perth, I've long been aware of the opportunities in some of the areas where the Golden Mile has its nickel and gold projects, particularly around Leonora, Darlot and in the Gidgee Belt. But, despite my exploration background I did not have any real appreciation of the potential at the company's flagship nickel-cobalt project at Quicksilver in the South West Mineral Field near the town of Lake Grace.

Though this project area has seen limited exploration in the past, nobody had realised either the full extent and grade of mineralisation, or ever considered it a real development opportunity. I think this is probably because many geologists, myself included, have underestimated the exploration potential in the south west of the state. This is something that is changing rapidly and the company has done very well to be strategically positioned with a key ground holding and the right expertise. 

RS: What drew you to the opportunity to lead this company at this time?

LR: Golden Mile Resources has a number of attractions for me as a mineral exploration and development company. First and foremost the company has a portfolio of attractive exploration and development projects, located in areas that have excellent geological potential and that are comparatively under-explored. It is also rare that you get an opportunity to take up an MD role with a company where the lead project has literally gone from discovery and resource definition into scoping-level studies in the course of a few months.

It is a very exciting time for me to become involved and the work will make good use of the skills that I have built over the years managing development projects. From a corporate perspective, the company listed on the ASX only a year or so ago and still has both a very tight capital structure - about 58 million shares on issue - and cash in the bank. Add to that an experienced board of directors and supportive key shareholders and I think that you have the ingredients for success. 

RS: What have been the main highlights of drilling to date at Quicksilver, in your view - in terms of both the supergene targeting, and the sulphide?

LR: In my opinion the highlight of the drilling on the laterite deposit at the Garard's prospect has been the realisation of the extent and continuity of nickel-cobalt mineralisation. Historical data only hinted at this kind of scale and so the discovery is a credit to the management and technical team who committed to undertaking the work.

Using mainly RC percussion drilling the company has quickly, cheaply and effectively outlined laterite mineralisation over about 1.6km of strike, with a width of around 600m.  It will now be very interesting to see how coherent this body of mineralisation is as the resource estimation process is undertaken.  It is also very encouraging that preliminary drilling has identified further mineralisation at Garard's South, adjacent to the current deposit, where there is potential for the delineation of further resources.

The sulphide targets at Quicksilver are at a much earlier stage of development but they are truly compelling opportunities because of the value uplift that discovery of a sulphide deposit would potentially give the company. We've now confirmed that the geophysical anomaly at Wyatt's prospect is sourced by semi-massive to massive pyrrhotite-pyrite-chalcopyrite mineralisation and despite the absence of significant nickel intersected there, we are keen to progressively explore the other discrete anomalies that occur further to the north, along the prospective trend of the ultramafic rocks. These targets are all relatively shallow and can be tested with RC percussion drilling, which is a very cost-effective way for the us to advance the exploration.

RS: What is the status of work to establish a maiden JORC resource on Garard (still on track for current quarter)?

LR: The work on a maiden resource estimate at Garard's prospect has commenced and is on-track for completion during the current quarter. A resource consultant has been engaged, as have a number of other industry experts to assist us with the geological and geochemical interpretation of the deposit. We have an excellent, modern assay database and plan to complete geological modelling of the deposit with a strong emphasis on the key geochemical zones and boundaries that control the distribution of mineralisation and which can be readily identified from these data.

The company recently completed diamond drilling on the deposit which has provided us with excellent core samples for measuring density of the mineralised rocks. We were pleased to find this is significantly higher than ‘typical' lateritic nickel deposits and this will have a positive effect on the contained tonnes within the deposit. The diamond drill holes also provided our geological team with valuable insights about the nature of the regolith profile which up to this point has been determined only from RC percussion drill chips.

RS: What have been the most significant findings/conclusions of Newexco's work to date?

LR: Our exploration program, in conjunction with the geophysical work completed for us by Newexco has shown that we can effectively identify, model and 'cheaply' drill near-surface anomalies within our ground that appear to be associated with massive sulphides. We now have the prospective ultramafic rocks comprehensively surveyed with a moving-loop electromagnetic (MLEM) system over more than 13km of strike. Newexco have identified and modelled a number of category 1 anomalies from the survey which we consider to be priority exploration targets. These anomalies are all discrete, non-stratigraphic conductors that have EM signatures that are analogous to other known nickel sulphide deposits.

RS: What are the primary objectives of the multi-faceted exploration program in progress, over the next 6-12 months?

LR: The company's exploration program over the next 6-12 months will be designed to address all our projects.

Quicksilver, being the most advanced, will demand more detailed technical studies such as resource estimation, metallurgical test work, etc, and I expect will progress to evaluation of mining and processing studies at a scoping level. If results continue to be favourable, then the company will consider both infill drilling and further work to delineate end expand the mineralisation at Garard's South. We are also keen to continue testing our sulphide targets along strike, with the objective to make a new nickel discovery.

Concurrently with the Quicksilver project development work, Golden Mile will also be getting to work on its projects in the north-eastern goldfields, where we have another nickel-cobalt project at Minara and untested gold potential on the Leonora East, Gidgee and Darlot projects. Minara is another area where significant resources could be delineated along strike from known mineralisation.

The gold projects, while at an early stage, all have potential for a new discovery in areas where additional resources could easily be developed.

RS: What is the company's current funding position/outlook on that front?

LR: The company currently has about A$2 million available to progress the exploration and development of its projects.

The management team has endeavoured to keep costs down, while not compromising on the effectiveness and outcomes of the work and this is something I will be keen to continue.  Nonetheless, it is anticipated that the exploration work program expenditure requirements will probably mean that the company will look to undertake further capital raising in mid-2019 or earlier if it is appropriate to do so.

RS: Obviously the market's receptiveness to exploration stories has nosedived this year - by and large - but as always will jump on standout discoveries when they are made. What is your view of current market sentiment, and what you are going to have to do in the months ahead to recapture the sort of interest that was there a year ago?

LR: The market sentiment is fairly ambivalent toward junior explorers at the moment and obviously the uncertainty caused by ructions on the US market in recent weeks are not helpful in the sense that they impact shareholder confidence overall. Nonetheless, there is still optimism around the price outlook for nickel and cobalt, both of which are considered to be key metals for the rapidly growing battery market.

I think the market will always react positively to news of new discoveries, just as we saw with the Golden Mile share price when the Quicksilver discovery was announced back in November of 2017.  We now have a fundamentally better understanding of that deposit and the challenge for me is to maintain the engagement of investors as we move through the time-consuming but essential process of technical studies on the mineralisation.

We will try to do this by continually working to demonstrate and communicate that the company has assets that have real value and that have a realistic development timeline. My opinion has always been that investors will back companies that have good assets; a strong technical, economic and scientifically-based plan to advance those assets; and a team who are capable of delivering on that plan.