Aruma Resources: Traversing the next underexplored Australian frontier

Mt Isa in Queensland is climbing the ranks of exploration hotspots, particularly as Australia’s second largest copper mine approaches its end date.

Glencore (LON:GLEN) revealed in October last year that it will be shutting the Black Rock underground mine in Q3 of 2024 followed by the other two underground copper mines, Enterprise and X41, and the copper concentrator in the second half of 2025.

This is due to the remaining resources no longer being economically viable as a result of low grades, unsafe geological conditions and ageing infrastructure.

The copper smelter at Mt Isa and refinery at Townsville will continue to operate until 2030 to process and refine third-party concentrate from other mines.

The year 2023 marked a century since the Mt Isa discovery, which was made by prospector John Campbell Miles in February 1923 when he uncovered lead ore while travelling through the region.

According to Glencore, convinced of the importance of his discovery, Miles quickly pegged out a lease which he named Mount Isa. This drew an influx of prospectors to the region, with 118 leases pegged by the end of 1923. Mount Isa Mines Ltd was established in January 1924.

Copper mining and production has taken place over 60 of those years. The copper within the Mt Isa deposit was mined later because the price began to rise at the same time the lead and zinc was being depleted.

The underground Enterprise mine, which came online in 1996, is Australia’s deepest mine, stretching down nearly 2km.

Junior explorer Aruma Resources (ASX:AAJ) has made its move into the Mt Isa area, in late May revealing it is acquiring the Bortala and Fiery Creek copper projects.

The Bortala and Fiery Creek Projects are located in the northern area of the Mt Isa copper belt, where global mining heavyweights like Rio Tinto (ASX:RIO), Anglo American and Glencore are also active.

Aruma Managing Director Glenn Grayson tells that during due diligence for the acquisition copper experts he spoke to said that, “Zambia might be the best place to look for copper in the world, but Mt Isa is the second best”.

Diversifying Queensland’s coal-dominated mining industry

This is further advantaged by the increased pro-mining stance of the Queensland government, which needs to diversify its coal-dominated mining industry.

“The Queensland government is really pro-mining these days,” Grayson says.

“That’s partly some of their own fault because I think they’ve hit the coal miners way too hard with the royalty, and with Glencore shutting down its enormous copper ore body and concentrator, there’s a shortfall of copper and a lot of capacity in the district.

“So, the government has made it really attractive to be exploring in Queensland.”

Recent initiatives introduced by the state government include a moratorium on tenement costs for five years, and a $5 billion cash injection to install an 11,100km long high voltage electricity transmission line connecting Queensland’s North West Minerals Province to the national electricity grid.

Queensland in comparison to Western Australia, which is exploration and mining heavy, still has plenty of untapped potential. This is another reason Aruma decided to diversify its portfolio of projects to Queensland and South Australia.

Grayson says studies on the amount of work and exploration spend, taking out coal and iron ore exploration, showed Western Australia was still seven times higher than Queensland.

“So when you go and look for ground in Western Australia, that’s not been heavily explored, it’s pretty hard really. But you go to Queensland and there’s plenty of opportunity there,” he explains.

It is also getting harder to undertake exploration in Western Australia, Grayson says, particularly due to issues around securing environmental approvals to do basic exploration. 

Western Australia puts the brakes on

Grayson says this is really “starting to put a handbrake on” Aruma completing work on the ground.

Interestingly, the Fiery Creek Project, which sits about 200km north of Mt Isa has been owned by several majors.

“They selected the ground based on geology. It’s got the right rocks for the Mt Isa-style mineralisation, but they always went in there looking for 50-million-tonne ore bodies,” he says.

“So when they didn’t think there was going to be an enormous ore body there, they dropped it. To the point where there has barely been any on-ground work done on Fiery Creek.”

Sumitomo owned it about 15 years ago and undertook some drilling to follow up high-grade copper rock chip samples. But apart from that, a large area of the tenement has not had any detailed geophysics.

Only government-scale gravity and magnetic surveys have been conducted.

The Bortala Project, although not as prospective for the favoured Mt Isa-style geology, has also demonstrated potential for copper mineralisation.

Grayson says Aruma has identified an epithermal quartz vein that has copper mineralisation coming from the middle of the volcanics, where past explorers never looked for copper mineralisation.

“It’s a cross-cutting structure, which they always look for, but not within the volcanics,” he says. “The geology is really interesting and we’re looking in areas that have been really underexplored.”

The Bortala Project is contiguous to 29 Metals’ (ASX:29M) Capricorn Copper Mine, which hosts a resource of 64.8 million tonnes @ 1.8% copper equivalent and produced over 18,000t of copper metal in 2021.

The project is interpreted as prospective for Mount Isa/Mammoth-style breccia copper deposits and epigenetic uranium mineralisation within the Eastern Creek Volcanic Formation.

29 Metals’ Capricorn Copper Mine is located adjacent to a significant magnetic high zone. Multiple magnetic lineations, late structures and gravity highs have been identified by previous explorers at Bortala.

Hunting for Olympic Dam-like deposits

Aruma says these may indicate the presence of enhanced iron oxide occurrences, which host high concentrations of copper, gold and uranium ores. Iron oxide copper-gold (IOCG) deposits can range in size from 10 million tonnes to over 4 billion tonnes.

BHP’s (ASX:BHP) Olympic Dam is an example of a major IOCG deposit and is the world’s fourth largest copper mine and the largest known single deposit of uranium globally.

The Bortala project’s geophysical features provide key exploration targets and are close to these gravity high zones, particularly in the eastern part of the project.

Aruma plans to explore for an IOCG system at Bortala, similar to those in the Cloncurry district in Queensland and the Gawler Craton in South Australia.

The company is also adding the 1,993km2 Wilan IOCG Uranium Project, located 140km from the Olympic Dam mine in South Australia.

Copper Search (ASX:CUS) is targeting Cloncurry-type IOCG discoveries at its Peak Project, immediately adjacent to the Wilan Project.

A priority IOCG target in the southeast and a separate priority Playa Lake Uranium target in the west of the project have been identified. The IOCG target has never been drill tested.

Playa-type uranium deposits are typically shallow and laterally continuous, which means they can be relatively easy to explore and exploit.

Grayson says South Australia is probably the most attractive jurisdiction in Australia to work in right now.

“They want more mines to get up and running and the Traditional Owners are quite open to negotiating as well,” he says.

Copper Search and BHP are actively exploring in the region and have been able to secure agreements with the same Traditional Owner group that Aruma will be working with to negotiate an agreement over the Wilan Project.

The road ahead

The company has gold, rare earths and lithium projects in Western Australia but it now plans to focus on the new acquisitions. 

Grayson says the priority over the next few months will be arranging geophysical surveys for the Queensland projects and advancing the access agreements for the Wilan Project in South Australia.

Aruma is planning some work over the Saltwater Gold Project in Western Australia in the near term, with the company about to start a soil sampling program comprising around 1,500 samples.

This is aimed at following up a previously identified gold anomaly.

Write to Angela East at 

Images: Aruma Resources
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Written By Angela East
Managing Editor Angela East is an experienced business journalist and editor with over 15 years spent covering the resources and construction sectors and more recently working as a communications specialist handling media relations for junior resources companies.