Brokers Bullish

On Gold Explorers

Australian brokers May and Mellor, with the UK firm Laing and Cruikshank are recommen ding investors grab a stake in the Pacific gold rush.

In a joint report to clients following a regional field trip both firms are enthusiastic about several gold prospects.

The recent interpretations of gold deposits associated with volcanic areas has led to new examinations of the whole of the Pacific “ring of fire” with most activity centred on the collision line of the Australia- India Plate and the Pacific Plate.

The line closely follows the New Zealand and Melanesian islands.

“Current theory,” says their report, “regarding the deve lopment of the earth’s conti nents allows for the movement of surface plates around the periphery of a molten but shrinking core.

“A general upwelling in the middle of the Pacific is moving the ocean floor outwards against the more stable contin ental masses. In the South-west Pacific the ocean plate is being forced against the Australian plate creating thrust and fault zones. ”

What this means is volcanic eruptions bringing all kinds of interesting minerals to the surface.

“Each and every individual volcanic emission contains different quantities of metals and not every system will con tain gold or any other particular metal in commercial quanti ties,” reported the brokers’ team.

It’s a case of examining each one to see if gold is present and then more tests to see if it can be recovered commercially.

Hence the sudden upsurge in exploration in the islands.

With the advent of satellite

photography, the job has been made easier, though ground sampling is still vital before moves to secure exploration licences can be made.

“In New Zealand, local poli tics make this stage tedious and time consuming, while Vanuatu moves very quickly,” say the moneymen.

“The potential in Fiji is very good,” clients are told.

Western Mining, a stock favoured by both brokers, negotiated a series of joint ventures with Emperor Mining over three years ago. Emperor had been extracting gold at Vatukoula for 50 years.

Western Mining, says the re port “have rejuvenated the mine, located additional ton nages of underground and open-pit ore, found an entirely new deposit and are sinking a development shaft.”

They are convinced the de posit area has further potential.

“The mining legislation in Fiji is well known and understood but is being revised at the present moment. It is not ex pected that there will be any undue environmental con straints put on companies in the development stage and tax allowances for capital expendi ture will continue.”

Vanuatu, until fairly recently ignored by the big prospectors, has seen an upsurge in activity. (June PIM page 21).

So much so, in fact, that practically all the possibilities are covered by existing licences.

City and Suburban and Ca nyon Resources are the main ground holders though several other interests are active.

“The republic is stable, it is financially sound and is in the process of drafting new mining legislation expected to be modelled on the Fiji and PNG systems,” the report says.