Encounter Resources (ASX:ENR) has begun a 3-hole diamond drilling campaign at its Carrara Project in the Northern Territory to define potential new copper-zinc deposits.
The $122.61 million market capitalisation company says drilling will test targets identified through seismic reprocessing and gravity surveys during October-November this year.
Encounter reports this drilling is part of its farm-in and joint venture (JV) agreement with mining behemoth South32 (ASX:S32), which is funding exploration work in return for a 60% interest in Carrara.
The project is located at an interpreted structural offset of the western margin of the Carrara sub-basin, which hosts the Century Zinc Mine on the eastern margin.
Encounter notes there is a ‘clear’ correlation of the Century Zinc Mine stratigraphy across the basin in Geoscience Australia seismic data.
Encounter Resources Managing Director Will Robinson says the new drilling is hoped to define a potential large sediment-hosted copper and zinc deposit in a region of ‘significant’ global opportunity.
“The greater McArthur Superbasin in the NT is a significant global opportunity for the discovery of new, large sediment-hosted copper and zinc deposits under shallow cover.
The Century Zinc Mine is located on the eastern margin of the Carrara sub-basin, and there is a clear correlation of the Century stratigraphy across the basin in seismic data.
Furthermore, the presence of copper and zinc mineralisation at Carrara was established in drillhole NDI Carrara-1 completed in 2020.
South32 has commenced a 3-hole diamond drill program with drilling expected to continue through to November 2023.”
“The greater McArthur Superbasin in the NT is a significant global opportunity for the discovery of new, large sediment-hosted copper and zinc deposits under shallow cover”
Encounter Resources controls a ‘large’ portfolio of wholly owned projects in Australia’s mineral provinces considered prospective for copper and critical minerals.
Under the company’s Carrara JV arrangement, South32 has the right to earn a 60% interest in Carrara by sole funding $10 million of exploration expenditure within 10 years. South32 may earn an additional 15% interest in Carrara by completing a Scoping Study during the farm-in phase or JV period.
Once earning the initial interest or further interest, a 60:40 or 75:25 JV will be formed.
South32 is the manager of the project during the farm-in phase.
The company’s wholly-owned projects include the Sandover Copper and Junction Lithium projects in the Northern Territory, as well as the Aileron Copper-Critical Minerals and Lamil Copper-Gold projects in Western Australia.
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