This article is a sponsored feature from Mining.com.au partner Cazaly Resources Ltd. It is not financial advice. Talk to a registered financial expert before making investment decisions.
Since listing on the Australian Securities Exchange (ASX) in 2003, Cazaly Resources (ASX:CAZ) has built a track record for successfully acquiring and developing, as well as divesting a range of resource projects.
Some 20 years later, the Perth-based mineral exploration company is combining proficient technical exploration skills and project acquisition finesse to increase its asset base and diversify its portfolio.
Cazaly is actively assessing inorganic growth opportunities as it seeks to add value to its existing project portfolio. Managing Director Tara French tells Mining.com.au that when executed correctly and with robust due diligence, their strategic direction provides plenty of investment benefits. Not least of which is exposure to a diverse range of mining properties and commodities, while minimising ESG and financial risk.
In addition to M&A, Cazaly will consider entering into joint ventures (JVs) to obtain ownership in an exciting asset, particularly one that is large and has the potential for significant upside.
With about $8 million in cash and investments, the company remains well-funded. French tells this news service that although this small war chest allows Cazaly to act fairly quickly on opportunities, it will not rush into any deals and will spend that capital wisely.
Acquisitive and attentive
The company is pursuing acquisitions in Australia, as well as internationally. While French did not disclose which countries were on its radar, regions of high-political risk will be avoided.
“We’ve still got quite a bit on our plate but we’re looking for new projects to add to our portfolio across a range of commodities, based on our strategic plan. We are willing to invest in countries where there is a genuine opportunity with low political risk.”
“We’ve still got quite a bit on our plate but we’re looking for new projects to add to our portfolio across a range of commodities, based on our strategic plan”
There are some early stage pure greenfields targets currently being considered by Cazaly. Alternatively, the company is open to potentially acquiring advanced projects and would consider executing a corporate transaction in that space to this end.
The MD adds: “Cazaly has a diverse range of projects from an advanced copper project that is currently part of a mine scoping study, to early stage greenfields projects with large geochemical targets including lithium, gold, copper, and REEs.
Our business model moves projects to add the most value to the company, this means we advance the project with exploration and may joint venture or divest, should the opportunity be more viable.
So that’s really the key, to add value to the projects that we’ve got, introduce new projects that we think have got real value to add as well, and then obviously prioritise how we work those projects.”
The company will continue to favour gold and copper, however lithium and rare earth elements (REEs) are also priority commodities.
“With every project we evaluate, we need to be able to see the growth potential, it has to have scale. So no matter what the commodity is there must be potential for significant upside.”
Pipeline of projects
The MD explains that Cazaly’s wider growth strategy is to hold a diverse portfolio of assets in different stages of development. Since day one on the ASX, the company’s plan has been to have a pipeline of projects.
“So, depending on which stage the project is in your pipeline, will dictate the work required to advance the project. From greenfields first pass geochemistry or geophysics to advanced resource drilling, there’s always work to be done on each project, and this is where prioritising your exploration activities come into play so funds are spent wisely. Obviously, the aim is always to move projects forwards, however a project could move backwards, depending on results. This is all part of the exploration process and just highlights the importance of prioritising your activities and having an ongoing review process.”
French adds that this spreads risk and allows the company to focus on and capitalise on projects that add the most value.
Cazaly already has diverse assets, some of which are abroad. The Abenab North REE Project lies in the Otavi Mountain Land region of northern Namibia located 450km by road from the capital of Windhoek close to the towns of Tsumeb and Grootfontein.
The region is a significant well mineralised base metal province with historic production from several mines including Tsumeb, Kombat, Abenab and the Berg Aukas mines.
The company’s Kaoko Lithium Project is also located in northern Namibia, about 800km by road from the capital of Windhoek and about 750km from the port of Walvis Bay.
“We do get opportunities that are in-country (Namibia) early, and that’s important to get you in front in the game. We do use our contacts outside of Australia, in a number of different countries, with in-country knowledge to get a head start on reviewing projects. This is just another part of our process and we’re continually looking for good, strong, value-adding projects.”
Exploration remains key
French says that while Cazaly is considering M&A opportunities, its inorganic growth strategy will not distract the company from advancing current exploration projects. The company has been quite busy over Q4 2022 in that respect.
At Halls Creek in the Kimberley region of Western Australia, a Maiden Resource Estimate (MRE) was completed for the Bommie porphyry copper deposit. It now has a total resource of 95.6 million tonnes @ 0.27% Cu for 262,000 tonnes of copper metal. This includes 16Mt @ 0.3% Cu as indicated material for 48,000t of copper metal. The project includes the Mount Angelo North copper-zinc deposit, an extensive zone of near surface oxidised mineralisation overlying massive Cu-Zn sulphide mineralisation.
The Mount Angelo North MRE, reported in accordance with the JORC Code 2012, is 1.72Mt @ 1.4% Cu, 1.4% Zn, 12.3ppm Ag (using 0.4% Cu lower cut) for 23,000t Cu, 25,000t Zn, 680,000oz Ag. The mineral resource includes higher grade intercepts including 64m @ 2.7% Cu (1.1% Zn), 62m @ 2.4% Cu (2.8% Zn), 37m @ 2.6% Cu (6.1% Zn), 16m @ 5.9% Cu, 18m @ 2.5% Cu.
The Bommie deposit is a porphyry system host to significant copper mineralisation
The Bommie porphyry copper deposit was the focus of exploration activities at Halls Creek during the December quarter. The Bommie deposit is a porphyry system host to significant copper mineralisation with previously reported drill intercepts including 170m @ 0.4% Cu, 178m @ 0.3% Cu and 136m @ 0.3% Cu. Higher-grade intercepts include 23m @ 1.0% Cu and 7m @ 1.3% Cu.
Cazaly also entered into a memorandum of understanding (MoU) with AuKing (ASX:AKN) to include the company’s resources into a mine Scoping Study. Cazaly is a project neighbour of AuKing’s Sandiego deposit at its flagship Koongie Park copper/zinc project in north-eastern Western Australia. Engineering consulting firm Wave International has been engaged to undertake the Scoping Study, which will consider all aspects of a proposed mine plan and is expected to be completed by the end of April 2023.
Also, during the December quarter the Abenab North licence was staked in Namibia, a new 790km-square exploration licence application for REE and base metals was made by Cazaly across a cluster of carbonatite intrusives.
Ascension of Ashburton
In February, Cazaly reported exploration had advanced at its Ashburton Project, located in the Pilbara region of Western Australia. Copper results were received from rock chip samples collected at the Cheela Plains prospect on E08/3272 and initial processing of final electromagnetic (EM) survey data was also completed.
The Cheela Plains prospect is located along the Najilgardy fault zone where Cazaly holds the rights to a major land position covering more than 2,450km-square in the Ashburton Basin. The project covers major regional structures considered to be prospective for large mineralised systems. French adds the Nanjilgardy fault is a major regional scale structure marking the boundary between the Capricorn Orogen and the Pilbara Craton and is associated with significant deposits including Black Cat’s (ASX:BC8) Paulsens gold mine and Kalamazoo’s (ASX:KZR) Mount Olympus gold mine.
Analytical results were received for 3 rock chip samples collected at Cheela Plains where Cazaly’s geologists identified copper in outcrop in the form of copper carbonates with visual estimates up to 3%, and up to 5% copper sulphides. Two of the 3 samples assayed above 10% copper, with the highest assay at 32.32% copper. French notes that the mineralised copper trend continues to the south-east with anomalous rock chip samples extending the anomaly over 2km strike.
The MD adds that an airborne electromagnetic (AEM) survey was completed across 3 blocks in early August 2022 for a total of 305 line kilometres at 400m or 200m line spacing. Final EM survey results have been received and processing has been completed for the first priority block “Survey Block 1” located at the Cheela Plains prospect along the Nanjilgardy Fault.
Last month, Cazaly also received analytical results from the rock chip heli-sampling program completed at Ashburton, in which 26 samples were collected from the sedimentary units of the Capricorn group over a 50km strike, adjacent to the Blair Fault, a deep seated regional scale structure.
Some 7 samples returned anomalous TREO above 0.5% with 2 samples above 1% TREO. Elevated REE include 118ppm dysprosium; 179ppm gadolinium; 619ppm yttrium; 2,070ppm lanthanum; 1,472ppm neodymium; and 431ppm praseodymium.
In addition, phosphorous results were also elevated to 4,600ppm. French notes these results are higher than those samples previously reported by Fortescue Metals Group (ASX:FMG) from within the Ashburton project area.
The MD adds: “We are pleased with the advances we have made at Ashburton, from staking the ground 18 months ago, we’ve identified large regional scale mineralised trends up to 70km long for gold, copper and REE, and have also identified project scale target areas down to 2km of strike. There is still plenty of work to do in the Ashburton, but we have made great inroads over the last 18 months and are certainly on the right track.”
Write to Adam Orlando at Mining.com.au
Images: Cazaly Resources Limited
