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Novo Resources (NVO.v), Kirkland Lake (KL.to) and the Rabbit Warren prospect in 1980

Kirkland Lake (KL) buying C$56m worth of Novo Resources (NVO.v) stock is news.
Kirkland Lake also being the counterparty to the Newmont (NEM) news on Friday, that’s news.
However, the story of the Rabbit Warren prospect, that’s not news. That’s 37 years old.
In 1980, Sydney ‘Snowie’ Barnes, and Peter Thompson, uncovered about
A$130 000 worth of gold here in a few days. The site is 9 kilometres
north-east of Leonora, and less than 50 metres north of the
Leonora-Nambi Road. It appears the endeavours about to be discussed
produced a small pit, now largely filled in.


One oral source states, Barnes and Thompson, had dug a 15 foot pit, and
set explosive charges into the wall, uncovering a thin plate of gold 3
feet across at a depth of 7 feet. A subsequent 8.5 tonne parcel produced
232 ounces to the tonne, or 7430 grams of gold.


The discovery led to a rash of exploration, during a period when certain
local entrepreneurs had more money than sense. The prospectors got paid
just over half a million for the lease by Peter Englebrecht, who then
made some unwise comments about the deposit in the hope of generating
interest, which had to be retracted on the insistence of the Australian
Stock Exchange.


After much wheeling and dealing, a joint venture was formed between
Cliffminex headed by Englebrecht, Endeavour Resources, Amber Gold Ltd,
and Bond Corporation headed by Alan Bond, infamous in Western Australia
for some less than ethical business dealings in the 1980’s.


Seven years later Endeavour and Amber are still persisting at the site,
but announce the deposit is only worth 17.7 g/t (which is good), but a
8.5 tonnes of ore yields 48 ounces worth A$3000 (which is bad,
considering the half million purchase price). Essentially this a classic
case of companies falling over themselves to buy a bonanza, which turns
out to be a small but rich find, which does not extend to any depth or
width beyond the original discovery.
Continues here.

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