Castillo Copper (ASX:CCZ) has entered into a conditional all-scrip agreement to sell its Cangai Copper Mine in New South Wales to Infinity Mining (ASX:IMI).
Infinity Mining will purchase three exploration tenements, making up the Cangai Copper Mine, which lies in the north-western corner of New South Wales. Inifinity Mining says Cangai was renowned for its “high-grade” ore, which was mined from the rich sulphide ore bodies in the area.
When it was in operation, Cangai processed ore with copper grades between 7% and 10% copper. Between 1904 and 1917, the mine produced about 5,000 tonnes of copper, along with “notable quantities” of gold and silver.
Both companies will execute a formal sale agreement, under which Infinity will issue 40 million shares and 20 million options at $0.07 with a five-year expiry date to Castillo Copper.
Subject to satisfying due diligence and securing key approvals, Castillo Copper — which has a market capitalisation of $6.5 million — will become a significant shareholder in Infinity Mining.
Castillo Chairman Ged Hall says the sale is an “excellent” outcome, as it is the second transaction that unlocks value for the company this year.
“Moreover, it validates the board’s strategy on optimising the non-core asset portfolio and enables resources to be channelled into developing the core NWQ Copper Project in the Mt Isa copper-belt,” Hall says.
“The board is highly confident Infinity Mining’s team has the capability to fully develop the Cangai Copper Mine tenements, which in turn has the potential to generate material value.”
Meanwhile, Infinity Mining executive Chairman Joe Phillips says the acquisition represents a “significant opportunity” for the company that aligns with its recent acquisitions undertaken in August 2024.
“With rising copper demand and the project’s outstanding historical grades, we are eager to unlock its full potential through targeted exploration and development,” Phillips says.
As part of the agreement, the holders of the existing royalties over Cangai will grant Infinity Mining the first right of refusal to forfeit or assign 100% of its royalty interests in consideration for 30 million Infinity shares and 15 million Infinity options, under the same terms as the acquisition.
Both companies expect to complete the transaction 60 days after executing a term sheet.
Once completed, Infinity Mining — which has a market capitalisation of $5.8 milion — plans to initiate an extensive exploration program at Cangai, focusing on unmined sections and the supergene copper zone.
These activities will include soil sampling, drone topographic surveys, and a two-stage drilling program to target the known orebody and new, deeper conductor anomalies uncovered through advanced geophysical techniques such as downhole electromagnetic and fixed-loop electromagnetic surveys.
Castillo Copper is an Australia-based copper explorer focused on developing multi-commodity assets that demonstrate future potential as an economic mining operation.
Infinity Mining holds more than 700km2 of tenements in the East Pilbara region, as well as 22km2 in the Central Goldfields of Western Australia. The company’s tenements are considered prospective for lithium, nickel, copper, and gold.
Write to Aaliyah Rogan at Mining.com.au
Images: Castillo Copper & Infinity Mining
