Coal billionaire ups Venus stake amid shining WA gold recovery tests

Venus Metals Corporation’s biggest shareholder Chris Wallin has tightened his grip on the company’s register after a Friday filing revealed the Queensland coal billionaire had snapped up an extra 1.9 million shares on market to lift his holding to 24.38 per cent.

Under corporate rules, shareholders can own up to 19.9 per cent of an Australian company before triggering a compulsory takeover offer. However, a creep provision within those rules allows the same investor to accumulate a further 3 per cent of the register every six months without needing to make a bid.

Given that Wallin has invoked the creep rules to take his holding in Venus to almost 25 per cent, it would seem fair to suggest he may not want to stop there.

At the centre of the investor’s keen interest appears to be the company’s 55-million shareholding in ASX-listed Rox Resources, which is worth $19.5 million in today’s market and almost mirrors Venus’ own $21 million market capitalisation.

Add to that a 1 per cent royalty over Rox’s Youanmi gold mine – independently valued at $9.5 million a year ago when gold was US$2000 (A$3100) an ounce – it’s not hard to see why Wallin may be on the buy tack. With gold now pushing A$5200 ($8000) an ounce, the royalty alone could hand Venus a lucrative cash stream for years to come.

The prized assets fell into Venus’ lap in 2023, when it sold its 30 per cent stake in Youanmi to Rox in exchange for 110 million shares. Youanmi hosts 16.2 million tonnes resource going 4.4 grams per tonne g/t for 2.3 million ounces.

Venus passed half its Rox shares on to its shareholders in specie, giving Wallin an instant 2.4 per cent slice of Rox. He has since built on that beachhead and now sits on a healthy 8.6 per cent of the Rox register.

Venus further set tongues wagging today by unveiling a set of cracking metallurgical results from its Bellchambers gold deposit, 23 kilometres southwest of Sandstone in Western Australia’s Gascoyne-Murchison region.

It says the remarkable results pushed gold recoveries as high as 99 per cent, suggesting its ore is both highly treatable and suitable for a low-risk, conventional processing pathway.

The test work, looking at seven reverse circulation drill hole intervals, was carried out by ALS Global in Perth under the watchful eye of SB Process Consultancy.

To gauge Bellchambers’ potential, the program trialled ore performance under cyanide leaching conditions to see how much gold could be hauled out through a simple gravity recovery process. The tests also measured how much reagent would be required to process fresh rocks.

Across both the fresh sulphide material and weathered oxides samples, recoveries came in between 90 per cent and 99 per cent. The oxide material leached so rapidly that more than 90 per cent of its gold was released within three hours and almost all within eight hours.

Gravity recoveries also showed a strong upside, with oxides generally outperforming fresh rock. In simple terms, this means there’s good scope to capture a sizeable slug of gold up front before the ore even hits the cyanide circuit – a handy option that could cut Venus’ processing costs and bolster its returns.

Adding to the good news, reagent usage stayed inside industry-friendly ranges. The oxides barely required any cyanide and lime during processing. While the fresh sulphides were a little hungrier, the reagent level they required still fell within manageable guidelines.

Venus says the results show the free milling ore at Bellchambers is about as straightforward as it gets. It is non-refractory, largely void of nasty elements and capable of yielding high recoveries with run-of-the-mill gravity and leach circuits.

The company believes that optimisation work to tweak grind size, cyanide concentrations and pH control could nudge recoveries even higher and reduce reagent use further.

Venus recently updated the gold resource at Bellchambers to 30,800 ounces at 1.27grams per tonne (g/t). At a 0.5g/t cut-off, the tally now includes 8800 ounces in the measured category, 17,900 ounces in indicated and 4500 ounces in inferred.

As part of the update, Venus also ran the numbers on a pit design using a $4500 per ounce gold price. At the same 0.5g/t cut-off, the optimised pit crunched out 19,130 ounces. While the measured slice held steady at 8730 ounces, the overall grade stepped up 7 per cent to a healthier 1.36g/t.

Venus last month took steps to speed up its open-pit development plans by securing a mining lease over the deposit. The company is also deep in talks with neighbour Rox over a potential farm-gate ore sale or toll treatment deal to process the ore.

Rox, which runs the Youanmi gold project, is edging closer towards a final investment decision on a standalone operation and plant construction.

Should Rox pull the trigger, Venus could paint a masterstroke via a straight ore sale or processing tie-up, which would see it dodge bankrolling its own plant, fast-track early cash flow and wipe away a hefty capex bill.

And if the gold price keeps humming along above $3300 an ounce, Bellchambers could quickly shape up as a tidy little earner with plenty to leverage for further exploration success.

Outside of Bellchambers, Venus holds a swag of other WA exploration plays across gold, base metals, lithium, titanium and vanadium.

With a billionaire backer quietly upping his stake, a resource upgrade in the bag, cracking metallurgy at Bellchambers and the prospect of a low-cost processing deal with Rox, Venus Metals is in a sweet spot.

Add in today’s lofty gold price and a portfolio brimming with WA exploration plays, and the company looks well-placed to turn its recent momentum into a golden run.

Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au