Encounter Resources (ASX:ENR) has returned copper sulphides within the first 2 drillholes at the Zeta target within the Jessica iron-oxide-copper-gold (IOCG) Project in the Northern Territory.
The $110.74 million market capitalisation company says exploration is being undertaken as part of a farm-in agreement with South32 (ASX:S32) and that the presence of copper sulphides provides support for the targeted IOCG deposit model at Zeta.
Other factors that support the existence of the IOCG deposit include chalcopyrite/bornite in thin quartz-carbonate veins, intense and pervasive red rock hematite alteration and bimodal felsic volcanic-basalt sequences.
The company notes geophysical techniques are being evaluated to vector into the best parts of the mineral system at Zeta while drilling continues.
Drilling is expected to continue through to November this year, with assays scheduled to be in hand in the December 2023 quarter.
Commenting on the drilling, Encounter Resources Managing Director Will Robinson says: “South32, our farm-in partner at Jessica, has informed us that observations from the first drillholes at the Zeta target have provided encouragement for the targeted IOCG copper model.
In a previously unexplored region of the NT, both holes drilled have intersected red-rock hematite alteration together with copper sulphides contained in quartz-carbonate veins. The 6,500m diamond drill program at Jessica/Carrara is ongoing with drilling to continue through to November 2023.”
Encounter also notes key terms of the farm-in joint venture (JV) agreement include South32 having the right to earn a 60% interest in Jessica by sole funding $15 million of exploration expenditure within 10 years.
“The 6,500m diamond drill program at Jessica/Carrara is ongoing with drilling to continue through to November 2023“
During the farm-in phase, South32 may earn an additional 15% interest by completing a Scoping Study and, upon South32 earning the initial or further interest in Jessica, a 60:40 or 72:35 JV will be formed.
South32 will be the manager of the project during the farm-in phase.
Encounter Resources is a copper, lithium and gold explorer with a focus on discovering major copper-dominant deposits in Australia.
South32 is a diversified mining and metals company headquartered in Perth, Western Australia focused on developing natural resources.
Together, both parties are developing the Jessica and Carrara projects in the Northern Territory. Jessica covers 10,300km-square along key structural corridors east of Tennant Creek and is considered prospective for sediment-hosted copper and IOCG-style deposits.
Encounter Resources had $11.818 million cash and cash equivalents at hand as of 30 June 2023, according to its latest quarterly report.
Write to Adam Drought at Mining.com.au
Images: Encounter Resources
