Castillo Copper Ltd (ASX:CCZ) is part of a new high-calibre coalition, the Broken Hill Alliance (BHA), aimed at progressing a highly prospective base metals tenement footprint surrounding the world’s largest high-grade massive zinc-lead-silver sulphide deposit.
BHA, which also comprises Impact Minerals Limited (ASX:IPT) and private group Squadron Resources, is set to own the largest tenement footprint surrounding the world-class Broken Hill zinc-lead-silver deposit in Far West NSW.
Three groups contribute
Castillo Copper will contribute its highly prospective tenure to BHA and this will complement quality tenements in the area from the other two groups.
BHA’s footprint in the Broken Hill region.
Castillo Copper’s managing director Simon Paull said: “Forming BHA is a clear win-win for all stakeholders.
“For CCZ, it will enable our Broken Hill asset to be optimised and value created for shareholders on a free carried interest basis.”
This project area is highly prospective for base metals and includes several priority targets for follow-up.
Despite its location in a prolific base metals area, the tenements have been under-explored in the past two decades.
The three stakeholders have signed a non-binding MoU formalising their intent to progress this project and begin discussions with potential strategic partners to expedite development.
CCZ is contributing its tenements in an area to be known as the NW Quadrant, the Impact tenements will be known as the SW-NE Zone and the Squadron tenements will be the NE Quadrant.
BHA’s tenure sub-components.
There is demonstrable exploration upside as historic drilling on the BHA ground has hit mineralisation the priority SW-NE Zone target of Dora East.
Historical results are 5.1 metres at 10% zinc, 0.8% lead and 40.4 g/t silver from 148.4 metres including 1-metre at 26.8% zinc, 2.8% lead and 133 g/t silver from 148.9 metres; and 1-metre at 21.4% zinc, 0.8% lead and 31.5 g/t silver from 152.5 metres.
In addition, the Thorndale target, also in SW-NE Zone, is a large zinc-lead-silver ± copper in-soil anomaly that extends for over 4 kilometres and covers a fold–repeat of the Broken Hill line of lode.
NW Quadrant prospective
NW Quadrant is prospective for polymetallic mineralisation, as recent and historic surface assays returned up to 2.1% zinc and 2.4% copper.
More encouragingly, within the region legacy near-surface assays recorded up to 17.7% zinc, 12% copper and 8.2% lead.
High-grade zinc targets in the NW Quadrant.
Historic work on the NE Quadrant has been limited, however, there are three priority targets that warrant further follow-up for Broken Hill Style lead-silver-zinc and ironstone-hosted copper-cobalt.
A deeper drill-down into the underlying geology within the proposed BHA tenure highlights a large pipeline of exploratory work ahead.
“Material upside potential”
Paull said: “The Board believes the BHA project, which surrounds the world’s largest high-grade massive zinc-lead-silver sulphide deposit, delivers material upside potential due to its sizeable footprint and high prospectivity for base metals.”
Under CCZ’s lead, BHA will be marketed to prospective strategic partners to expedite exploration and development.
Impact will retain the rights to all platinum group metals (palladium-platinum-rhodiumosmium-iridium-ruthenium) as well as associated nickel-copper and other precious and associated metals across its entire tenement holding in the region.
CCZ said this agreement delivered the potential for two material value-add benefits:
- Efficiently optimises a quality asset for stakeholders; and
- Leverage to concurrently progress the company’s three core copper pillar strategy and dual London listing.
CCZ’s London-based director Ged Hall said: “This is an exceptional deal that facilitates a quality asset being developed.
“More importantly, as we move forward with the London listing plans, its pleasing that our Broken Hill asset is being optimised.”
The non-binding MoU provides a structured framework to move forward to a definitive agreement
CCZ will now commence discussions with prospective strategic partners, on BHA’s behalf, to finalise an agreement then to establish timelines for exploration and development work to begin.