Vanrock JV Qld

Cazaly Resources secures option to earn-in to polymetallic Vanrock Project in North Queensland

Cazaly Resources (ASX:CAZ) will undertake due diligence after entering into an agreement to earn-in to the Vanrock Project in central north Queensland 350km west of Cairns.

The earn-in agreement with privately held Lynd Resources via its subsidiary company Vanrock Resources, includes Cazaly committing to sole fund the drilling of the single planned hole into the Vanrock target by 30 November 2022.

Cazaly will fund the drilling of this initial hole as an option before electing to progress further with the joint venture (JV).

The company reports other aspects of the earn-in agreement include Cazaly able to earn 60% in the project by spending $1.5 million (inclusive of attributable initial drillhole costs)  over three years, with its stake to increase to 90% should the venture complete a bankable feasibility study (BFS) at the project.

Also, among other features of the deal, Lynd is able to revert to a 2% net smelter royalty if its interest falls below 10%.

There are further milestone payments payable in cash or shares, among other aspects.

The company reports that as a diversified mineral explorer this project provides an exciting opportunity for Cazaly to be a first mover in an underexplored newly recognised mineral district concealed beneath surficial cover.

Commenting on agreement, Cazaly Managing Director Tara French said: “Cazaly is excited to be working together with Lynd’s high quality and successful technical team in testing the potential of the Vanrock project to host a world class polymetallic system in a newly identified, poorly explored region in central North Queensland.

“Cazaly is excited to be working together with Lynd’s high quality and successful technical team”

Cazaly identified tin as a priority commodity target to add to our portfolio in our 2021 strategic planning session and now have the opportunity to be a first mover in this new search space.

For Cazaly, it is an excellent target ripe for drill testing, highlighted by coincident anomalies. This single drill hole will enable us to assess our position and decide fairly quickly whether or  not to pursue the project thereafter.”

The Vanrock project is located in central north Queensland 350km west of Cairns (Figure 1). The Project lies within the northern portion of the Townsville-Mornington Island Igneous Belt (TMIB), which extends over 700km from Townsville to the Gulf of Carpentaria.

To the southeast of the project area, where there is very little cover, the TMIB is host to several million-plus ounce (Moz) gold deposits, with the total gold endowment in the NE QLD region now sitting at 40Moz.

The district also has a long history of tin exploration and mining dating back to the early 1900s. Much of the company exploration conducted in the late 1960s-70s by North Broken Hill Ltd, Mount Isa Mines Ltd, and Newmont Holdings Pty Ltd was in areas of outcrop.

In more recent times new polymetallic discoveries have been made undercover by Gold Aura, now Crater Gold Mining (ASX:CGN), at the A1 & A2 prospects located to the southwest of the Vanrock Project, near Croydon where massive sulphides were intersected, “widths varying from 2m to 13m downhole containing potentially economic concentrations of Zn (1.35 to 10.13%), Ag (32.7 to 642g/t), Sn (0.12 to 0.63%) ± Pb (0.25 to 2.1%) and/or Cu (0.13 to 0.57%)”.

The Vanrock drill target is a coincident magnetic and airborne EM anomaly (flown by Geoscience Australia) on the edge of a palaeo-caldera. The target will initially be tested with a single diamond drillhole, designed to intersect the modelled magnetic units interpreted to represent parallel sulphidic mineralised lodes.

Tin prices have reached 10-year highs in recent times due to strong physical demand growth exceeding global supply against a backdrop of falling supply with prices remaining well above pre-pandemic levels.

Demand growth currently sits at 23% (to the March quarter International Tin Association) as demand continues to grow from the electronics sector whilst LME inventory levels remain low.

Images: Cazaly Resources Ltd
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Written By Adam Orlando
Mining.com.au Editor-in-Chief Adam Orlando has more than 20 years’ experience in the media having held senior roles at various publications, including as Asia-Pacific Sector Head (Mining) at global newswire Acuris (formerly Mergermarket). Orlando has worked in newsrooms around the world including Hong Kong, Singapore, London, and Sydney.