Shares in Cobar explorer Peel Mining got a boost this week with the appointment of Woolrych and Amos as MD and CFO respectively, as well as Ronnie Beevor as non-executive chairman.

Current chairman, Capricorn Metals director Mark Okeby, will remain on the board, while executive director Rob Tyson, who won the AMEC Prospector Award in 2019 for Peel’s discoveries, will stay involved.

As part of the fresh start, the company is about to get a capital injection, entering a trading halt yesterday.

According to a term sheet circulating, Peel is seeking to raise up to A$11.3 million in two tranches at A8.5c per share, an 11.5% discount to Wednesday’s close.

Euroz Hartleys and Canaccord Genuity are acting as joint lead managers, brokers and bookrunners, with Sternship Advisers appointed as co-manager.

In conjunction with the placement, St Barbara is looking to sell its 7.1% stake in Peel for around A$3.5 million.

A share purchase plan will be launched to raise up to a further A$2.5 million.

Peel had A$1.4 million cash at the end of June.

New challenge

It’s only been four weeks since the New World takeover closed, but Woolrych said Peel was a good opportunity.

“Firstly, we all know there’s a bit of an empty landscape of quality copper resources in Australia at the moment, and I feel like, potentially over the last couple of years, Peel has gone from having one of the best copper endowments in the region – and it still does – but it just hasn’t necessarily released what is probably the latent value in the assets,” he said.

Peel’s flagship project is South Cobar in NSW, a project containing five deposits across 2764sqkm.

The project has a resource base of 22.9 million tonnes at 1.03% copper, 0.37 grams per tonne gold, 35g/t silver, 0.72% lead and 1.45% zinc, or 2.2% copper equivalent, for 500,000 tonnes of CuEq.

Despite the large resource base, Peel shares have drifted lower over the past three years, losing more than half their value.

“We’re in one of the moments in history where people want copper more than ever before and it’s sort of inexcusable to be drifting, or to be just ignored in the market,” Woolrych said.

“I wouldn’t have been interested in this if it didn’t have such a good underlying resource base, because you can work with that.

“These guys also have exploration in their DNA. Rob Tyson, who’s staying around in an executive capacity, but moving off the board, he’s found all of these projects since inception, and not many people can claim four major greenfield discoveries in a region.”

A prefeasibility study is underway on the development of the Mallee Bull and Wirlong underground mines which would supply a standalone plant at Mallee Bull.

Woolrych is only a few days into the job but is not keen on Peel building its own processing plant.

“The reason for that is there’s five operating processing plants in the Cobar region, plus another two that are on care and maintenance, all of which can process the Peel material.”

Cobar consolidation

Woolrych admitted things had been happening around Peel without Peel being involved, with a number of deals and new mine starts in the past couple of years.

South Africa’s Harmony Gold is wrapping up a US$1 billion takeover of CSA owner MAC Copper.

“I think that will light a fire under the region a little bit,” Woolrych said.

“A lot of people talk about Cobar consolidation, because it makes all the sense in the world, but there’s a whole lot of great companies there doing good things and the market’s rewarding those companies now, finally, and so to get the attention of someone like Harmony, that’s really good, and arguably, they’re the first mover in what is a bit of a consolidation story.”

Woolrych and the refreshed board and management team will review Peel’s assets, including processing options, as well as plan a fresh round of exploration aimed at growing the resource base.

“Most importantly, it’s a proper first principles evaluation of the portfolio,” he said.

“There are five deposits. They don’t necessarily belong together through one processing facility.

“Can we do a processing deal on particular projects? These projects aren’t hard to build themselves, and without the complexity of a processing plant, it’s relatively straightforward.

“Is there a consolidation play? Do assets belong elsewhere, in better homes? How do we give our shareholders a bit of time in the sun? That’s what it’s all about.”

Woolrych said all options were on the table, including project-level, corporate and processing deals.

“Judging by the inbound discussions and reactions, and everyone has said they like the assets, like the region, and so we’re pretty fired up to get it going.”