Liontown North Drilling Begins: Can Sunshine Metals Unlock New Gold Zones?

Exploration Advances at Liontown North

Sunshine Metals Limited (ASX – SHN) has begun diamond drilling at its Liontown North prospect, located approximately 500 metres from the established Liontown resource, which boasts 6 million tonnes at 3.6 grams per tonne gold equivalent. This drilling is supported by a Collaborative Exploration Incentive (CEI) grant from the Queensland state government, underscoring the strategic importance of Liontown within Queensland’s critical minerals landscape.

The program involves a 650-metre diamond drill hole designed to test coincident induced polarisation (IP) and electromagnetic (EM) geophysical anomalies on the northern flank of the Liontown Dome. Sunshine’s Managing Director, Dr Damien Keys, highlighted that this is the first diamond drilling targeting the northern contact of the Liontown stratigraphy, aiming to refine geological models and validate a new interpretation of a tightly folded stratigraphic horizon.

A New Geological Model with Significant Implications

Historically, the volcanic-sedimentary contact hosting the Liontown resource was interpreted as an east-west striking, steeply south-dipping sequence. Sunshine Metals’ recent work suggests this contact is tightly folded, with a fold closure located beneath shallow cover at the eastern edge of Liontown East. This reinterpretation opens up a previously underexplored 3-kilometre stretch of prospective contact, where limited historic drilling has returned encouraging gold intersections, including 4 metres at 0.65 grams per tonne gold.

The CEI grant of $162,157 covers the costs of this initial diamond drilling, which will test the fold closure concept and the associated geophysical anomalies. Success here could materially expand the known resource base and enhance targeting for future exploration.

Concurrent Drilling and Upcoming Catalysts

Alongside Liontown North, Sunshine Metals is also commencing drilling at the Sybil gold prospect in August 2025, with both programs running concurrently. This dual approach reflects the company’s commitment to advancing multiple targets within its Ravenswood Consolidated Project, a district known for its rich history of gold and base metal production.

Investors can anticipate a steady flow of news in the coming weeks, including metallurgical test results and a resource upgrade at Liontown. These developments will provide further clarity on the project’s economic potential and the viability of extracting gold and base metals from the complex mineralisation.

Strategic Positioning in a Proven Mining District

The Ravenswood Consolidated Project sits within the Charters Towers-Ravenswood district, a prolific mining region that has produced over 20 million ounces of gold and 14 million tonnes of volcanogenic massive sulphide (VMS) zinc-copper-lead-gold ore. Sunshine Metals’ portfolio includes advanced gold and base metal prospects, with significant intersections reported in recent drilling campaigns, underscoring the district’s ongoing exploration potential.

Sunshine’s exploration strategy leverages detailed geological modelling, geophysical surveys, and targeted drilling to unlock value from both gold-rich footwall zones and VMS deposits. The company’s engagement with government incentives and its methodical approach to exploration position it well to capitalize on the region’s mineral wealth.