OZ Minerals possesses extensive exploration experience both in Australia and at international sites. Growth through exploration is a central part of our strategy to add value to the company.
Over the last year OZ Minerals has put in place five separate exploration joint venture partnerships with highly regarded explorers. These provide OZ Minerals with exploration expertise in specific geologies or locations. Our JV partners’ in turn access capital to undertake drilling programs. OZ Minerals typically works with its joint venture partners to oversee projects while they manage on the ground activities. OZ Minerals’ growth strategy involves building a pipeline of opportunities and rigorously progressing these. In line with our capital discipline strategy, if at any time it is determined that a project does not have the potential to generate substantial value, OZ Minerals will cease expenditure and withdraw from the arrangement.
For the latest information on exploration and relevant disclosures under JORC 2012, please refer to our quarterly reports and ASX releases. Below is a brief outline of our current exploration projects.
In December 2016 OZ Minerals entered into a Heads of Agreement with privately-owned explorer, Red Tiger Resources, to undertake an exploratory drilling program 30 kilometres north-west of its Carrapateena project.
The Intercept Hill project is targeting Iron Oxide Copper Gold (IOCG) mineralisation similar to that seen at OZ Minerals’ Carrapateena copper project and existing mines in Prominent Hill and BHP Billiton’s Olympic Dam.
The reprocessing of a suite of geophysical data revealed previous explorers in the region may have overlooked possible IOCG gravity anomalies. These targets will be drill tested in early 2017.
Red Tiger Resources will initially drill four holes testing four separate targets as part of ‘Stage 1’ with the initial funding of circa $1.2 million provided by OZ Minerals. OZ Minerals can elect to spend a further $2.8 million on exploration to earn a 51 per cent interest in the tenement as part of ‘Stage 2’. Upon completion of OZ Minerals’ Stage 2 commitment, a Joint Venture will be formed. OZ Minerals will have the option of funding a further $5 million on exploration to earn an additional 24 per cent interest in the tenement, with a potential to hold a 75 per cent interest in the tenement.
Red Tiger Resources is a privately held resources explorer based in Adelaide.
Refer to ASX announcement: 22 December 2016 New Head of Agreement to target wider Carrapateena province prospects
West Musgrave Project
(OZ Minerals earning up to 70%)
In August 2016 OZ Minerals signed an agreement with Cassini Resources to earn up to 70% of the West Musgrave Project, Australia’s largest undeveloped copper nickel deposit.
The project is located in the Musgrave Province of Western Australia and includes the Nebo-Babel nickel-copper and Succoth copper deposits. Nebo and Babel contain a combined, estimated 203.1 million tonnes at 1.38% copper equivalent. The Succoth deposit inferred mineral resource estimate is 156 million tonnes at 0.6% copper.
Refer to the following ASX announcement for mineral resources: 01 August 2016 West Musgrave
A significant amount of the estimated resources occurs beneath shallow cover of less than 50 metres. OZ Minerals is hoping to establish the West Musgrave project as a scaleable, low cost, long life, open pit mining operation.
The tenements have excellent potential for further magmatic nickel-copper sulphide discoveries. Copper and nickel intersections have been returned from drilling at several other prospects.
The company has committed an initial $3 million for a scoping study to identify an optimised pathway to commercialisation.
In July 2016 OZ Minerals entered into an agreement with Mithril Resources to explore seven exploration licences in South Australia’s far western Coompana Province. Mithril is an experienced nickel and copper exploration company based in South Australia.
The Coompana area has been the subject of significant amount of airborne and ground geophysics conducted by the South Australian Department of State Development in collaboration with PACE Copper. Surveys include magnetics, seismic and magnetotellurics. The areas are essentially unexplored and provide OZ Minerals with an opportunity to make exciting discoveries.
Under the terms of the agreement, if Mithril identifies potential drill targets, and the technical merits of the targets are acceptable to both parties, then negotiations would advance to a formal joint venture to undertake exploration on the relevant tenements.
Target generation has been commenced by Mithril.
Refer to ASX Announcment: 21 July 2016 OZ Minerals and Mithril Resources to explore SA’s last frontier
(OZ Minerals earning up to 70%)
In December 2015, OZ Minerals and Minotaur Exploration entered into a binding Heads of Agreement for the Eloise Project, located near Cloncurry, Queensland.
The Cloncurry Mineral District contains strong mineral endowment in a variety of commodities, including Cu-Au (Ernest Henry, Eloise, Osborne and Mount Elliot/Swan deposits) and Zn-Pb-Ag (Cannington, Pegmont). The geology of the tenements indicates excellent prospectivity for high-grade Eloise-style Cu-Au and Cannington-style Pb-Zn-Ag deposits.
The agreement follows recent exploration success by Minotaur at the Artemis prospect and gives OZ Minerals access to a terrain which is strongly endowed in copper and other base metals.
In its first 6 months the joint venture uncovered several significant IP chargeability and EM anomalies that had not been previously drill tested. Drilling commenced in H2 2016 at Bullwinkle, Olympus, Iris North and Iris South prospects.
Refer to ASX announcement: 17 December 2015 OZ Minerals and Minotaur earn-in at Cloncurry
(OZ Minerals earning up to 70%)
In December 2015, OZ Minerals entered into an innovative agreement with Toro Energy on its tenements covering part of the Yandal Greenstone Belt in Western Australia. OZ Minerals committed an initial $0.5 million to a drilling program after investigations into historical drilling data uncovered evidence of shallow nickel mineralisation on the edge of a large, high-amplitude magnetic anomaly, within 60km of BHP’s Mt Keith mine.
The area has been flown with high resolution airborne magnetics to refine drill targets.
Refer to ASX announcements: 11 December 2015 OZ Minerals to drill for nickel near Mount Keith
25 November 2016 Drilling Commences at Nickel Prospect in Western Australia
(100% OZ Minerals, Minotaur earning in)
In October 2015, OZ Minerals and Minotaur Exploration announced an innovative agreement comprising a collaboration to explore for base metal deposits on the Mount Woods exploration licences around Prominent Hill. The agreement gives Minotaur access to OZ Minerals’ vast repository of more than 15 years of exploration data. This database includes geochemistry, potential field and electrical geophysics and geological information from drilling.
The agreement provides significant strategic value for both parties. If Minotaur identifies any potential drill targets and the outcome of the due diligence is acceptable to both parties, then the parties will negotiate and enter into a formal joint venture to undertake exploration on the relevant tenements. It allows Minotaur to provide its expertise in interrogating the database to generate new targets for drill testing, and provides OZ Minerals with an opportunity to accelerate its search for new copper resources in the Prominent Hill district.
Drilling commenced at Mount Woods in Q3 2016.
Refer to ASX announcement: 20 October 2015 OZ Minerals joins forces with Minotaur Exploration