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Castillo Copper buoyed as high-priority structural target identified at Zambian project

An independent review of Mkushi project by SRK correlates with the preliminary work of the company’s in-country geologists.

Castillo Copper Ltd - Castillo Copper buoyed as high-priority structural target identified at Zambian project

Castillo Copper Ltd (ASX:CCZ) is encouraged by results of an SRK Exploration Services site visit to the Mkushi project in Zambia that has identified a high-priority structural target for copper mineralisation.

SRK’s independent review and preliminary report recommend that Castillo focuses on NE-SW strike extensions to the structured shear zone that intersects Shi & Yang Group’s (SYG) contiguous mining lease and the Mkushi project.

The report highlights that there is potential that known copper deposits exposed at surface within SYG’s mining lease, that are being mined, could continue under cover, trending SW, within Mkushi project.

“Encouraging outcome”

Castillo Copper’s managing director Simon Paull said: “The conclusion and recommendations from SRK’s preliminary independent report are very welcome news.

“Clearly, having a 4-kilometre strike zone already mapped out to target copper mineralisation, ahead of our exploration campaign moving into top gear, is an encouraging outcome from SRK’s visit to the Mkushi project.”

The SRK findings align with the company’s in-country geology team, which identified the same high-priority target.

Two parallel shear zones

A detailed review of heritage data confirmed there are two parallel shear zones 2-3 kilometres apart trending NE to SW that originate in SYG’s mining lease.

The northern shear zone, which is contained within SYG’s ground, was drill tested extensively for copper mineralisation in 2006 by previous owner African Eagle Resources.

A southern shear zone, which comprises a similar geological structure, intersects the Mkushi project delivering a strike of approximately 4 kilometres and priority exploration target to test drill for copper mineralisation.

Historical drilling results in the adjoining mining lease of SYG.

Further target areas

In addition, Castillo’s geology team reconciled numerous historic geochemistry results with field trip observations, identifying several more exploration target areas in the southern part of the tenure for follow up on future field trips.

Paull said, “More significantly, combined with other prospective targets, the Mkushi project has materially boosted the exploration upside across the Zambia assets.

“This is a welcome development, as with the recent findings from the Mt Oxide project, CCZ now has two pillars delivering upside from well-known structural copper regions.”

The SRK team travelled from Zambia’s capital, Lusaka, by the paved Great North Road to the Mkushi project then via several public gravel roads to the tenement.

Adjoining artisanal mining

This route took them through SYG’s mining lease, on public access roads, where they observed organised but informal artisanal open pit mining.

The artisanal miners were working on the site of a historical underground mine closed nearly a century ago, extracting copper oxide ore.

These artisanal workings extended 8-10 metres from near-surface as the historical mine, which is deeper at 15-20 metres, is flooded.

The weathered material being extracted by the artisanal miners was hand sorted for higher grades, bagged and reportedly sold to Chinese buyers.

SRK considers the Mkushi project prospective for copper-gold-manganese mineralisation and recommends initial exploration work should focus on the NE-SW strike extension of the shear structure associated with the Mtuga line that extends into the Mkushi project.

“Closing in” on LSE listing

CCZ’s London-based director Ged Hall said: “This is very positive news that will be warmly embraced by our UK investors.

“More importantly, with SRK completing its required site visits to CCZ’s projects, we are now closing in on finalising all key reports to submit to the London Stock Exchange to progress the dual listing.”

Castillo Copper is formulating plans for the next field trip to the Mkushi project which will comprise significant mapping and sampling ahead of geophysics surveys to further refine prospective targets to test drill.

In addition, SRK’s findings on all key projects are being thoroughly reviewed ahead of being released.

Three pillars

The Zambian projects are one of three key pillars the company is focusing on as it aims to become a mid-tier copper producer, with the others being Cangai in New South Wales and Mt Oxide in Queensland.

The company is also progressing a dual listing on the standard board of the London Stock Exchange.

With Cangai, the company’s Board aims to elevate discussions with the NSW Resources Regulator to find an optimal pathway forward to remove and then process the legacy stockpiles.

Concurrently, metallurgical test-work is being progressed at the laboratory on the latest samples taken from Cangai Copper Mine.

These will be shared with Noble Group as part of the ongoing due process necessary to secure a binding offtake agreement to distribute up to 200,000 tonnes of copper concentrate.

Quick facts: Castillo Copper Ltd

Price: 0.023 AUD

Market: ASX
Market Cap: $19.1 m

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