Newcrest Share Price Higher Thanks to Small-Cap Explorer (ASX:NCM)

The Newcrest Mining Ltd [ASX:NCM] share price has opened higher today as exploration gets underway at its joint venture Wilki project in Paterson Province, WA.

Seeking to securer new gold sources for processing plant at Telfer, NCM entered into a farm-in agreement with small-cap explorer Antipa Minerals Ltd [ASX:AZY].

This isn’t AZY’s first experience with Australia’s mining giants.

The junior explorer has also had joint ventures with Rio Tinto Ltd [ASX:RIO] and IGO Ltd [ASX:IGO].

NCM’s share price is 1.43% or 47 cents higher at the time of writing, trading at $33.25 per share.

Like many other Aussie gold miners, the NCM share price has rebounded strongly since March thanks to the high price of gold.

ASX NCM Share Price Chart - Newcrest Mining

Source: Tradingview

NCM share price higher with gold price

The price of gold in USD terms pushed higher overnight, gaining 0.5%.

Which may also be a contributing factor to NCM’s share price gains today.

With the spot gold price hitting US$1,810, thanks to a global spike in coronavirus cases, we could see a record high hit this year.

In AUD terms, gold pushed 0.41% higher too and still trades near historic highs.

Good news for the NCM share price.

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Strong demand for the yellow metal could remain even when the virus is eventually controlled.

Unprecedented monetary stimulus injected into the economy may support a higher gold price in the medium to longer term.

Accordingly, NCM seems keen to extend the life of one of its key assets, Telfer.

AZY’s Wilki tenements are located just north of the Telfer mine in an area that has no historic drilling.

AZY has begun aerial electromagnetic surveying to identify potential copper-gold targets.

NCM will spend $60 million over eight years to earn a 75% interest in the Wilki Project.

Why not explore yourself?

The benefit to NCM in the farm-in agreement is that if AZY doesn’t strike gold or produce the desirable results, they can elect to not proceed further with the agreement.

Meaning they’re less out of pocket had they bought the tenements themselves.

Newcrest does seem confident in AZY and Wilki though.

As part of the farm-in, NCM also invested $3.9 million for a 9.9% stake in Antipa.

With Phase 1 of the exploration programme focused on identifying potential drill targets, we won’t get a sample of what’s beneath the surface until Q4 this year.

AZY said they have already identified nine gold targets as the Paterson Province begins to attract more big-name gold miners.

If you’re looking to make a play in Aussie gold miners as the price of gold heats up, then make sure you check out our free guide on how to pick a winner. To learn more and get your exclusive investor report click here.

Kind regards,

Lachlann Tierney,

The Rum Rebellion


Lachlann Tierney is a writer for The Rum Rebellion and has been investing for nearly a decade. With a Masters of Science from the London School of Economics, he brings a sound understanding of global markets to his writing. Lachlann is interested in emerging technologies, energy solutions and helping people invest their money wisely. 

The Rum Rebellion