New Murchison Gold (ASX:NMG) hits high grade at Lydia

Key highlights

• NMG surged 21.57% to $0.062 on Tuesday, with 162.3 million shares traded as the market reacted to new high grade drill hits at Lydia.
• The company says Lydia could become a near term satellite feed for the Crown Prince operation, leveraging existing site infrastructure.
• Recent drilling extended mineralisation along the Lydia shear zone, with standout results including 3m at 32.9g/t gold and 9.1m at 10.3g/t gold from diamond drilling.

New Murchison Gold (ASX:NMG) put its name back into the market conversation after releasing a drill update that points to a potentially meaningful production kicker close to its Crown Prince Gold Mine near Meekatharra in Western Australia.

The numbers mattered. NMG finished the session at $0.062, up 0.011 or 21.57%, with the day’s range running from $0.052 to $0.062 and volume spiking to 162,328,357 shares. Turnover was about $8.89 million, with a VWAP of $0.056.

That kind of liquidity on an ASX junior is rarely an accident. The catalyst was Lydia.

NMG said its latest drilling at the Lydia Gold Prospect has delineated additional mineralisation in the Lydia shear zone and extended the known strike and depth of the main structure. The program included 33 reverse circulation holes for 2,920 metres, plus three diamond holes totalling 281.5 metres that tested mineralisation and the structural setting.

There were also five geotechnical holes drilled into planned pit walls for a proposed pit design, with geotechnical analysis underway. That detail is easy to overlook, but it is one of the more practical signals in the release. It suggests the company is not just mapping targets, it is actively testing what a pit might look like and how it could be engineered.

In other words, Lydia is being framed less like a distant exploration punt and more like a potential contributor to the broader Crown Prince production line.

The drill hits that moved the needle

NMG’s headline intercepts included several high grade and thick zones, with the release calling out the following “best intersections” from the drilling program:

• 3m at 32.9g/t gold from 46m, including 1m at 62.4g/t from 47m (NGGRC1094)
• 9.10m at 10.3g/t gold from 89m, including 1m at 24.6g/t from 94m (NGGDD1144)
• 8m at 9.1g/t gold from 20m, including 4m at 16.7g/t from 24m (NGGRC1309)
• 21m at 3.4g/t gold from 117m, including 1m at 8.4g/t from 135m (NGGRC1109)
• 12m at 5.5g/t gold from 48m, including 4m at 14.6g/t from 52m (NGGRC1307)
• 7m at 8.5g/t gold from 90m, including 1m at 16.1g/t from 91m (NGGRC1112)

The inclusion of diamond drilling results alongside RC is notable because diamond holes are typically used to better understand structure, validate continuity, and support modelling confidence, especially if a resource update is coming.

Why Lydia matters for Crown Prince

NMG positioned Lydia as a close-in opportunity. The company said Lydia sits on a granted mining lease (M51/889) and is covered by the same Native Title and Heritage Agreement that guides arrangements for Crown Prince. It also described Lydia as around 800 metres west of Crown Prince, and said mineralisation appears similar to the Crown Prince deposit, with the shear zone described as around 20 to 25 metres thick.

That is the strategic “why now” behind the announcement. A prospect that is nearby, on a granted lease, and potentially compatible with existing infrastructure often has a shorter conceptual pathway to development than something greenfields and remote.

Source: NMG ASX ANNOUNCEMENT

NMG described the Lydia shear zone as a structural feature that likely sits within a local “jog” between intrusive rocks. In simplified terms, these kinds of structural bends can act like pressure-release valves for mineralising fluids, creating pockets where gold deposition becomes concentrated.

The company said the shear zone trends north to northeast and dips steeply west. It also noted a ground gravity survey over the Lydia South shear that outlined prominent gravity features, and early drilling lines returned shallow, high grade intercepts in that area.

For non-specialists, the practical takeaway is that NMG is building a geological case for continuity and scale across multiple sub-areas, not just a single lucky hole.

Lydia South and Lydia East: the extra layers

Beyond the main Lydia shear, NMG highlighted additional work at Lydia South and Lydia East.

A slimline RC program tested Lydia South inferred shear and Lydia East, with NMG noting exploration had been limited historically due to station infrastructure and access constraints, but the station was recently de-stocked, enabling work over previously restricted ground.

The company also said only four holes were drilled at Lydia East so far, but results were encouraging and will be followed up with infill and deeper drilling.

These are still early stage compared with the core Lydia work, but they widen the narrative from “one zone” to a broader prospect area that could feed future modelling.

What happens next

NMG laid out a clear next-step plan:

Update mineralisation modelling and incorporate it into a JORC-compliant resource model, then redesign a conceptual pit outline

Infill drilling along the new Lydia South shear to define shallow high grades

Additional drilling over the Lydia East prospect

That sequencing is important. It implies the company is shifting from discovery and interpretation into resource definition and mine planning logic, at least at the conceptual level.

Why the stock moved so sharply

NMG’s price action looks like a classic mix of three things.

First, the drill results are genuinely high grade in places, and the intervals include both thickness and grade, which usually reads better than narrow spikes.

Second, the company framed Lydia as a potential near term addition to a production line, not just a resource-building exercise. The language around leveraging existing infrastructure and bringing Lydia online relatively quickly gives the market something operational to price in.

Third, the volume surge suggests strong attention, whether from momentum traders, existing holders adding, or fresh interest drawn to a liquid session.

The key risks to keep in view

Even with a strong drill update, there are sensible limits to what can be concluded today.

A resource model update is still a forward step, and it will take more drilling and modelling work to translate intercepts into tonnes, grades, and mineable shapes. Geotechnical work is underway, not complete.

The pathway from exploration results to reserves and then to production decisions is rarely linear. Investors will likely watch for the resource update and pit optimisation work as the next “proof points” for whether Lydia is genuinely production-adjacent.