One year on from its Australian Securities Exchange listing, MRG Metals has acquired three potential company-maker projects, adding to a strong suite and at the same time de-risking prospects and diversifying cash flow options.

Western Australian copper and gold comprised MRG’s prime $A5.7 million initial public offering interests, but coal was soon added to the company’s exploration portfolio.

“Coal and gold each provide significant production margins, both at current and lower prices,” MRG Metals managing director Andrew Van Der Zwan told RESOURCESTOCKS.

In April 2012, MRG acquired an additional WA gold project.

The two tenements with Tropicana analogues comprise 100 blocks within the same geological province as keenly watched gold exploration and development projects held by AngloGold Ashanti and Independence Group, Ausquest, Sipa Resources and Thor Mining.

While known for the 5 million ounce Tropicana gold project resource, the region is also prospective for Broken Hill-type base metals mineralisation.

Now the company is ready to reward investors with higher profile, headline-producing activity, commencing with a series of investigative data and drilling results due to continue throughout 2012 and beyond.

The 1700 hectare Kalgoorlie East gold and nickel project, purchased in July 2011, within a few weeks of listing, represents MRG’s current drilling priority.

MRG likes the location, near Barrick Gold and Newmont Mining’s Kalgoorlie Super Pit and Barrick’s 5Moz Kanowna Belle gold operation.

In addition, the 15 tenements comprising the project are underexplored by modern methods.

Long-established regional infrastructure, together with nickel prospectivity underscored by the nearby Blair and Carnilya Hill projects, add to the project’s attraction.

Heritage and ground electromagnetic surveying programs were completed in April 2012 and maiden MRG drilling is underway.

The initial 5000m of RAB drilling is targeting shallow gold anomalies while additional RC drilling is testing EM anomalies considered prospective for nickel.

Initial results could be known as early as next month.

Despite a planned $200,000-400,000 2012 exploration spend on its Kalgoorlie East gold and nickel prospects, MRG intends to simultaneously assess its other July 2011 acquisition, the southwest WA Collie South coal project.

“Without doubt, the project that has the most potential to dramatically enhance MRG’s profile and capitalisation is Collie South,” Van Der Zwan said.

Collie South’s attraction was the particular expanse and nature of land assembled by Perth-based geologist Paul Askins.

Hosting potential for new coal-bearing basins and proximal to some of the best-quality, low-sulfur, low-ash, high-calorific coal operations in southern Australia, Collie South presented to MRG as a likely export operation plus domestic power industry sales.

Again, infrastructure and other support resources are well-established.

“In terms of exploration potential, however, the recent arrival of Japanese and Indian corporations in Collie has really boosted the region’s profile,” Van Der Zwan said.

“Depending on what we find, we could compete to supply to the local power industry, develop an export operation and perhaps even sell assets to the bigger players.”

MRG needed to risk just $50,000 cash and one million company shares for an initial 30% Collie South interest.

It also has options to pick up another 30% next year and to fully acquire the project within three years.

MRG has completed Collie South reconnaissance mapping and plans to commence drilling on public access land by June 30, 2012.

Pending results, MRG will continue drilling during the second half of 2012.

Land owner access will then become the focus as the company maps out the likely project profile.

Meanwhile, MRG has secured granted exploration licences for its 100%-held Xanadu gold project, the company’s premier prospect on listing. Xanadu is in WA’s Ashburton region, located 38km southeast of Paraburdoo, on the same fault conditions as Northern Star Resources’ respected Ashburton project.

MRG is very much encouraged after acquiring, and recently completing an evaluation of, additional Xanadu data.

“We are really positive about the data, which has essentially identified high-grade target potential, and it would be fair to say this project is now back on the radar as another priority,” Van Der Zwan said.

“MRG will undertake further Xanadu exploration this year, and if we decide to ramp up, given the remoteness of the location, we could look at joint venturing with interested third parties in the area.”

Sampling results are just coming to hand for MRG’s Braemore Battery gold and copper project, located 5km north of Leonora in WA’s far northeastern goldfields.

Preliminary analysis appeared promising and MRG is keen on any identified copper potential sufficient to enhance the company’s multi-mineral profile.

MRG retains a free-carried interest through to production for three other WA gold and copper projects on which the company completed its ASX listing: Mulgul, near the Abra base metals project in WA’s Gascoyne region; Diorite, 25km north of Leonora; and Bell Chambers, near Sandstone in the WA Murchison region.

The company will continue to monitor the potential value of each of these as initial results come to hand.

MRG attributes its project acquisition success to a range of quality WA geological, technical, and investment industry connections.

“Last year we had some raw assets,” Van Der Zwan said.

“Since then we have completed a lot of desktop analysis and are now ramping up to preliminary drilling.

“We can now identify ourselves as a true drilling and exploration play.”

In the coming year, investors can look forward to a potential series of gold, nickel, coal and copper exploration results.

Within two years, MRG aims to define resources for at least two development projects.

Results this year will dictate the allocation of cash reserves, which total approximately $4.5 million.

Pending success with results, MRG anticipates commencing road shows later this year.

“MRG is well funded for the next two years, and by then we expect to be finalising resources for at least two of our current projects,” Van Der Zwan said.

“But should early, comprehensive success mean rapid expansion, we would be looking at cornerstone investors.

“We would promote the company locally, but we also have some key shareholders with key contacts in London.”

*A version of this report, first published in the June/July 2012 edition of RESOURCESTOCKS magazine, was commissioned by MRG Metals

This article first appeared in ILN's sister publication MiningNews.net.