Finding a large-scale iron oxide copper-gold deposit would be a thing of beauty in the rising copper market.
But there hasn’t been one since BHP’s “discovery” hole in 2018 at its Oak Dam project, 65km from its Olympic Dam IOCG monster, and 45km from the Carrapateena IOCG deposit it picked up in last year’s $9.6 billion takeover of OZ Minerals (yes, it can pull off a successful takeover).
Using the quotation marks around discovery is an acknowledgment that it was WMC that first explored at Oak Dam (WMC was acquired by BHP in 2005 for $9.5 billion, wow, another successful takeover).
But hats off to BHP as it was AD23 it drilled in 2023 that assayed 425m grading 3% copper, including a wonderous 180m intersection grading 6% copper, including values for gold and uranium normally found in Gawler Craton’s IOCG deposits.
BHP is now putting a twin decline into the deep discovery, ostensibly to create underground drilling platforms to probe the discovery more. But it is considered pre-development by everyone else.
And why wouldn’t BHP want to probe it further. A stock exchange-compliant but necessarily conceptual exploration target was announced last year of up to 1.7 billion tonnes at 1.1% copper and 500Mt at 0.8% copper on the low side.
So that is 4Mt of copper on the low side, and a whopping 18.7Mt of copper on the high side, with BHP not bothering to report the gold and uranium count which on a combined basis at Olympic Dam at least, is good for one third of project revenues.
Anyway, all that goes to show just how valuable a decent IOCG can be, even to the likes of BHP, now licking its wounds after fluffing its takeover bid on Anglo American and its big porphyry copper projects in Chile and Peru.
IOCG juniors:
Spurred on of late by copper’s march into record price territory, there a couple of plucky juniors about to have a shot at finding a large-scale IOCG. It is leveraged stuff in the extreme if they are lucky enough to hit the good stuff.
Astute Metals (ASX: ASE) is one of them. It last traded at the princely price of 2.9c for a market cap of $12 million, which is not a lot, whether it was about to an test an IOCG target or not, because it has other interests.
Those interests include a good-sized mineral sands project near Busselton in WA which has passed through the scoping study stage hoops, and an interesting lithium clay exploration project in Nevada where drilling is underway.
But back to the IOCG hunt. It’s in the East of Tennant fairway, so-called because the ground sits to the east of Tennant Creek in the NT, with Mt Isa over to the west in Queensland. Thankfully, Astute has simplified things by calling it its Georgina Basin IOCG hunt.
Government-sponsored drilling a few years back identified the region as ripe for IOCGs and there was a pegging rush in to the area by both the big end of town and the juniors.
Astute has remained one of the most active and is planning a June-July drilling program, with the Leichardt East prospect the first to be drilled because of the target size, its high density character, its structural location, the depth of the target, and the presence of pathfinder elements in some nearby holes.
Rawson Lewis recently had a look at Astute’s portfolio of mineral sands, rare earths and the IOCG hunt in the Georgina and arrived at a speculative “buy” recommendation with a target price of 10c.
Back in SA’s Gawler Craton, another junior with the most descriptive of names, Copper Search (ASX:CUS), is about to punch in some holes into two large-scale prospects at its broader Peake project area to the east of the Oodnadatta Track.
It last traded at 11.5c for a market cap of $12.8 million after pulling in $2 million from a 10c share placement with attached 1-for-2 options exercisable at 15c. It had the cash for the drill program but in the world of juniors, it’s always best to raise when you can.
The two large scale prospects it has identified are Paradise Dam and Douglas Creek. The 6-week drilling program is due to start next week.
The Peake project area is in the northern reaches of the Gawler Craton which had previously been over-looked for its IOCG potential because it was thought the rocks weren’t of the right age.
But preliminary exploration by Copper Search and others, including an AIC Mines/Oz Minerals joint venture, have changed the perception.
Paradise Dam is first up and will test for a disseminated copper sulphide system without the density contrast of a typical IOCG deposit. It will be followed by Douglas Creek which is a classic IOCG-style (coincident magnetics and gravity anomaly) target.
Needless say, to be testing two targets is potential high-impact stuff for Copper Search, which is also adding a gold leg to the Peake story.
Silver:
Silver has been doing the right thing by the ASX-listed silver stocks by comfortably holding above $US30/oz compared with its CY2023 average of $US23/0z.
Investors seem to be buying into the thematic that because of falling production in Peru, and silver’s surging use in solar panels, there is more to come in the price.
That has been reflected in the good gains of late posted by the established ASX silver names like Investigator (ASX:IVR) and Silver Mines (ASX:SVL). Same goes for the deepening pool of ASX-listed stocks with a silver bent.
Sun Silver (ASX:SS1) was mentioned here pre-IPO and has since taken off to 53c. More recently there has been a welcome return to trading of Mithril (ASX:MTH) after it was recapped. It has just kicked off a new drilling program at its Copalquin project in Durango state, Mexico.
It is high-grade stuff that the Spanish would have mined as far back as 1525, and by the locals before them. Mithril already has a resource of 370,000oz of gold and 11Moz of silver at one of the four interpreted “hydrothermal upwelling zones” identified in what is a district play.
Meanwhile, down in southern Chile, Mitre Mining Corp (ASX:MMC) also has a district play on its hands at its Cerro Bayo silver-gold project in the Aysen region. Cerro Bayo currently has a 50Moz silver-equivalent resource estimate.
But that is very much the start of the story. On Thursday, Mitre announced high-grade assay results from a swarm of silver-gold veins outside of the resource estimate and all of 7km from the existing processing plant from previous mining in the area.
Best results included 10,466g/t silver (336oz) and 51.6g/t gold (1.65oz). It is why when the company says there will by two resource updates at Cerro Bayo in the next six months, high expectations with this one are building.
The stock was mentioned here on March 28 when it was trading at 38c. It is now 71c.