Gunnawarra Project

  1. Introduction

The Gunnawarra Project area is approximately 130km south-south-west of Cairns, 108km south-south-west of Mareeba and 214km north-west of Townsville, an approved Cobalt and Nickel export port.   Access is readily available via the Kennedy Highway from Mareeba and then via the Gunnawarra Road, a formed and graded council road.  Gunnawarra Station has a rural airfield.  Several tracks dissect the project area giving good vehicle access to most of the tenement.  The project lies adjacent to and overlays tenements associated with Australian Mines Limited Sconi Cobalt-Nickel-Scandium project.

The climate of the area is sub-tropical, being warm and dry in winter and hot and wet in summer.  Two thirds of the rainfall occurs between December and March.  The mean annual rainfall recorded at Mt Garnet is 781mm.  The average maximum daily temperature ranges from 21⁰C to 35⁰C.

Vegetation across the Gunnawarra project areas is mapped as predominantly Category B Remnant vegetation with some areas of Category X Vegetation.  Approximately 50% of the vegetation on site at EPM 26560 consists of RE 9.5.5a/9.5.6a considered least concern under the Vegetation Management Act, the remainder being a mix of Res 9.11.26a, 9.5.8, 9.8.4, 9.8.1 and 9.3.10a. 
Open woodland that is both sparse and mid-dense consisting of Corymbia clarksoniana, Eucalyptus leptophleba, Eucalyptus portuensis, E.cebra and Corymbia citriodora.  At EPM 26599 the dominant vegetation consists of RE 9.11.5, sparse woodland of Eucalyptus persistens, and E. crebra with a sub canopy of Carissa lanceolata and Acacia spp.  Themeda triandra (kangaroo grass) and Heteropogon triticeus (giant spear grass) are the main grass species.

The topography is generally gently undulating sitting between the 720m and 620m contours and forms part of a Tertiary laterite land surface.  The land surface is in an advanced state of dissection with the laterite capping having been partially stripped off, revealing scattered low hills and small ranges of pre-tertiary rocks.  The area contains a variety of physiographic features including hills, small ranges, mesas, plateaus and valleys. 

The Gunnawarra Project consists of EPM 26560 located 30km south of Mt Garnet in Far North Queensland and EPM 26599, 17 km south of Greenvale both of which are held by Ark Mines Ltd. was granted on 24th November 2017 for a period of two years and a renewal has been lodged; EPM 26599 was granted on 24th November 2018 also for a period of two years.  Since grant, exploration work has concentrated on EPM 26560 and has comprised of site visits, localised sampling (returning anomalous Platinum and Palladium confirming the potential Sulphide extension), assay work and desk top research, table 1.

Ark Mines Ltd. Gunnawarra (GW)

Surface Sample highlights (July 2018) include;

GW105 – Cobalt – 4430ppm

GW101 – Nickel – 14,350ppm

GW87 – Copper – 2320ppm

GW87 – Scandium – 60ppm

GW107 – Chromite – 13,500ppm

GW105 – Manganese – 228,000ppm​

Table 1. Surface Sample Highlights EPM 26560

The region has a long mining history predominantly nickel, cobalt, gold, tin and zinc and is part of the Greenvale Nickel Province which produced some $7 billion of nickel and cobalt between 1974 and 1992.  Mining is still active in the area with Consolidated Tin operating the Surveyor Mine near Mt Garnet. 

With the demand for electric vehicles increasing and the need for improved batteries, the ability to secure supply of both Cobalt and Nickel will be paramount in the future.  Electrical vehicle sales are predicted to account for 30% of all new vehicle sales by 2025.  Nickel and Cobalt account for the majority of the metals used in the manufacture of lithium-ion batteries and sufficient future supply is likely to be challenging.  

Significantly EPM 26560 forms the centre, and is adjacent to, Australian Mines’ Sconi Cobalt Project at Bell Creek, now at more advanced stage of development with feasibility studies being finalised and currently the most advanced Cobalt-Nickel – Scandium Project in Australia. Ark Mines Ltd. Gunnawarra Project therefore holds a strategic position.  Similarly EPMA 26599 lies directly south of the Sconi Greenvale Project and holds potential for considerable deposits being the extension of the Greenvale Nickel belt.


EPM 26560 comprises 11 sub-blocks covering 36km².  The tenement sits within pastoral lands lease Gunnawarra Station and cattle grazing is the dominant land use.  The underlying tenure has extinguished native title and is therefore 100% exclusive of Native Title.

EPM 26599 comprises 8 sub-blocks covering 24km2.  This tenement straddles three pastoral holdings, Porphyry Creek Holding, Wade Holding and Shield Creek Holding all of which are pastoral land leases.  The underlying tenure is currently subject to Metallica Minerals and QLD Gold Pty Ltd ILUA.

2. Regional Geology

The project lies in the eastern most part of the Georgetown inlier in the Greenvale sub province close to the Palmerville Fault Zone.  Carboniferous to Upper Permian post tectonic granite emplacement and acid volcanism is associated with the major regional structural feature.

3.Local Geology

Geology specific to site consists of these pre-Cambrian Halls Reward metamorphic rocks overlain by the Sandalwood Serpentinite (Proterozoic injections) and intruded by the Gunnawarra Bump Granite (pale pinkish, medium-grained porphyritic biotite monzogranite) in the late Carboniferous to early Permian.  These rocks are buried by the Pleistocene vesicular to massive olivine “Depression” Basalt forming the northern and western margins of the area peripheral to Bell Creek and are largely obscured by late tertiary to Quaternary lateritic soils and alluvium.

The Sandalwood Serpentinite forms four outcrops of low topographical highs within EPM 26560, and trends north-west, south of Bell Creek.  These are superficially separated by alluvium and/or lateritic clays.  At Greys Creek in EPMA 26599, narrow serpentinite belts are associated with the Greys Creek Ultramafic Complex. 

Deep chemical weathering during the Cainozoic caused the formation of a laterite profile which, where developed over the ultramafic units, contain enhanced nickel and cobalt values.  Nickel enrichment >1% is concentrated both in layers in a ferruginous pisolithic laterite found in depressions adjacent to the Serpentinite outcrop and in the underlying weathered Serpentinite.  The duricrust varies in depth up to 5m thick.  Magnesite is commonly present in the lower parts of the duricrust.  The duricrust is underlain either by hard, barren silicified Serpentinite or locally deeply weathered Serpentinite, the latter probably developed along fracture zones.

Previous exploration, by Metallic Minerals, of the area encompassing the Gunnawarra Project (EPM 26560) demonstrated strong magnetic signatures being displayed generally as magnetic highs with associated dipole lows.  A hole drilled into the anomaly in 1982 intersected Norite.  Norite occurs with mafic and ultramafic rocks in layered intrusions and has been associated with the Sudbury Basin complex in Ontario, the world’s second largest nickel mining region.

Previous exploration at Greenvale identified hard rock chromite and nickel mineralisation.  Here the Halls Reward Metamorphics and the Grey Creek Complex of gabbros, dialogite and serpentinites form the oldest units being Proterozoic.  The structure and metamorphism is complex.  Ordovician Donaldson Well Volcanics are overlain by arenites and mudstones which in turn is intruded by the Saddington Tonalite.  Carboniferous conglomerates, arkose, shales and limestone of the Clarke River Formation overlie.  Cainozoic deposits including the basalts and partially lithified sand and gravels over much of the area and include the tertiary laterisation responsible for the Greenvale nickel deposits.

4. Mineralisation

Comparison can be drawn between this project and the historical Greenvale mine, both being in the Greenvale Nickel Province, which produced 40Mt (dry) of nickel cobalt ore from 1974 – 1992.  The deposit is reported as producing approximately $7 billion worth of nickel and cobalt metal over an 18 year period.  The ore was mined in a 3km² area to an average depth of only 20m. 

Previous exploration has established the existence of potentially economically viable high-grade Nickel and Cobalt deposits within the EPMs and surrounding area.  Analysis by Austin Anderson (Australia) Pty Ltd of rock samples indicated high values of Nickel and Cobalt occurring in the ultrabasics with a high Ni: Co ration of 20:1.  Specifically Metallica Minerals Ltd reported a measured and indicated resource of 14.49 million tonnes in the Bell Creek area.  Metallica Minerals had planned to mine the deposits directly west of the Gunnawarra Homestead and within the current EPM held by Ark Mines Ltd.

At Bell Creek, Metallica reported the ultramafic bodies being deeply weathered to form nickel laterites as part of the Sandalwood Serpentinite intruded along north-north-east trending faults.    The nickel mineralisation was considered to occur throughout the laterite profile.  Limonitic ores lying above the saprolite zone were generally found to have high grade cobalt with the saprolite zone generally containing high magnesium and iron along with high nickel value.  Out crops of laterite occur across a strike distance of some 2.5 km with an inferred resource of 3.31 Mt for 23,110 tonnes of contained Ni metal and 1324 tonnes of Cobalt.   Metallica Minerals, through the wholly owned subsidiary Qld Gold Pty Ltd, prepared an IAS for submission in which they proposed the mining of three pits in the Bell Creek Northwest Prospect describing isolated outcrops of laterite over a strike distance of 2.5 km and covering 26 hectares.

Reported mineralisation appears to be confirmed by the first pass sampling regime carried out by Ark Mines Ltd in 2018.  Random surface hand samples were taken from sites in the north-west of EPM 26560, figures 1 and 2.  These have been assayed returning upwards of 0.8% Ni and anomalous Co to 0.07%. 

  • In the alteration sequence, two distinct types of laterite are formed. The recognition of residual textures in these forms provides an indication of the ore grade in the underlying sulphide body, and as a result further exploration is now in progress.  Diagnostic features of Ni-Co-Cu gossans include:
  • High Ni-Co-Cu
  • High Pd-Pt
  • Variable Co-As
  • Low Cr-Mn-Zn-Pb

Gossans, capping non-nickeliferous sulphides, Ironstones and representing laterised sulphides, which can generally be distinguished by:

  1. Low Cu-Ni/high Zn and
  2. High Ni-Cr-Mn and low Cu respectively

Even siliceous nickel gossans generally retain some characteristics or geochemical “signatures” of their diluted metal contents.  Given the high-grade Anomaly these samples represent a probable sulphide body at depth.  Ark mines Ltd. are very encouraged by the latest results therefore have extended their exploration program.

Within in the area of the Greenvale EPM26599 held by Ark Mines Ltd., rock chip samples have returned some highly anomalous results from Serpentinites with significant mineralisation for Nickel, Chromite and Vanadium from previous historic surface samples.

Greenvale EPM26599 area Highlights from Surface Samples

Nickel – 3480ppm

Cobalt – 257ppm

Vanadium – 764ppm

Chromite – >10,000ppm

Table 3. Surface Sample Highlights EPM 26599

Due to the significant mineralisation present in the rock chip samples at Greenvale, Ark Mines Ltd. have allocated a budget for further exploration to be carried out in H2 of 2018.

The project holds a strategic position sandwiched between tenements held by Australian Mines Ltd.’s Sconi Project at Gunnawarra and the Greenvale project along with Superior Resources nickel-cobalt project.  Both of which are considered highly prospective for economic values of nickel and cobalt.  Further exploration including targeted drilling would need to be competed to delineate the resource and confirm historical work carried out by Metallica Minerals Ltd.

5. Previous Exploration

On Gunnawarra Station a small tongue magnesite deposit was mined from a weathered and laterised serpentinite and two tungsten occurrences are known to be present in the immediate area.  At the turn of the century 70 ounces of gold was produced from a mine located on the property.

In the 1970’s A.O. Australia Pty Ltd, holders of AP671 and 1289M, conducted 91 percussion drill holes for 2000m, a series of costeans and a representative bulk sample.  A.O. concluded that the four outcrops were probably continuous based on a magnetic survey and the results of the percussion drilling.  A.O. lodged two mining lease applications across the lateritic nickel deposits.  From exploration in Area 1, which coincides with EPM 26560, the company concluded an inferred reserve for the Gunnawarra area to be estimated at 23.7 million short tons (21.5 metric tonnes)  grading 1.05% Ni using a 0.5% Ni cut off or 10.8 million (9.8) tons grading 1.55% Ni using a 1% Ni cut off comprising as follows:


9.4 million short tons (8.4) grading 0.93% Ni (0.5% Ni cut off).

2.6 million short tons (23.6) grading 1.81% Ni (1.0% Ni cut off).


13.3 million short tons (12.06) grading 1.15% Ni (0.5% Ni cut off).

7.8 million short tons (1) grading 1.46% (1.0% cut off).

North western  

1.1 million short tons grading 1.15% (0.5% cut off.)

0.4 million short tons (0.36) grading 1.33% Ni (1.0% cut off.)

The company further reported grades and thicknesses of nickel mineralisation varying from 0.5% to 3.5% and 1.5 to 21 metres thick respectively.  

CRA explored the area in the 1990s primarily for supergene magnesite and gold and finding nothing prospective relinquished the area.  However in 1995, Renison Ltd carried out exploration activities seeking gold on EPM 10235, including reconnaissance mapping, regional rock chip sampling and investigation of previous exploration. 

Renison considered the area prospective for breccia hosted gold deposits similar to Mt Leyshon and Kidston hidden underneath transported alluvium and residually developed regolith.  The EPM was assigned to Metallica Minerals Ltd in 1997 and formed part of the Nornico Project.

Metallica Minerals Ltd expressed confidence in the presence of mine level deposits of high-grade lateritic nickel-cobalt which they planned to process on site using acid leach metallurgical processes to produce metal concentrates for sale domestically and on the international market.  This Nornico Project included areas under the current EPM held by Ark mines Ltd.

The Nornico/Sconi Project also encompassed “Bell Creek” EPM 11285 and EPM 14101 (now EPM 26560) and the Mining leases 4187 and 4188 (now ML20549) concentrating on identified “substantial” nickel-cobalt resources.  This EPM mirrors that held by Ark Mines Ltd. and the subject of this report. 

In December 2017 Metallica Minerals Ltd sold 100% of the Sconi Project to Australian Mines Limited who have since moved to development of the project.