Helix Resources overcoming hurdles to become Cobar region’s next major copper play

This article is a sponsored feature from Mining.com.au partner Helix Resources Ltd. It is not financial advice. Talk to a registered financial expert before making investment decisions.

It has been a somewhat challenging year in 2022 for junior exploration companies.

Macroeconomic conditions soured amid ongoing issues with the pandemic, and La Niña has been wreaking havoc, preventing access to many mine sites and exploration prospects.

Despite the tumultuous year, Helix Resources (ASX:HLX) hit the ground running early and has forged ahead with advancing the company’s Canbelego Joint Venture (JV) Project located in the Cobar region of New South Wales.

While many juniors struggled to access capital to fund their drill programs, Helix rattled the tin in March to raise $13 million in equity to accelerate exploration. And the market responded in kind.

As Managing Director Mike Rosenstreich explains, the capital raising was well supported by institutional, professional, and sophisticated investors. It put Helix in a strong position to maintain its aggressive exploration in a region hosting a series of major copper discoveries.

The MD says that the company will continue its busy works program in the new year, including inspecting targets directly along strike from the Greater Canbelego area along the Rochford trend, with drilling to scope out the potential of the western lodes.

Big decisions ahead in 2023

Reflecting on the year that was ahead of looking into 2023, the MD says while Helix achieved a significant number of objectives, like most juniors it had to overcome challenges beyond its control.

From the pandemic, to delays in assays, and inclement weather, Helix was not immune to vagaries of the mining sector that have plagued many companies.

“In terms of company performance – I think we get a C+/B- and the improved mark is due to emerging exploration success late in the year. I am a tough marker.

Like others we had challenges in regard to assay turn around and Covid – but in particular with land access due to the second year of extraordinary rainfall events. So, we are not as progressed on screening and testing our regional targets as I would like.

“A major achievement has been building up the story at Canbelego”

But we have built our team up through the year – all based in Orange, 4 full-time geos and 2-3 long-term part-time consultants with specific NSW expertise. A major achievement has been building up the story at Canbelego. We consider this to be a CSA Mine – look alike in that it is a copper deposit which extends to depth, has multiple lodes, and is high-grade.

Late in the year we started to get some extraordinarily high-conductance anomalies from our Downhole electromagnetic (DHEM) surveys – interpreted as massive copper sulphide shoots, that is – high-grade copper. We just announced that 1 of our 2 rigs has broken down – so it will not hit the target DHEM conductor until mid-Jan. But we are double-shifting the surviving rig – so we hope for visual results before the Christmas break.

This is pivotal drilling and what the market is watching for. These holes in progress at Canbelego will impact the strategy into the new year if we hit the goods.

If we get massive copper-sulphides, that’s likely to further accelerate drilling here at Canbelego as a fast track to add copper tonnes to the existing Mineral Resources. But I also want to restart regional exploration as the ground dries out. So, some big decisions on deploying capital and resources are hopefully coming up.”

High-grade assays support bold drilling at Canbelego

As mentioned, Helix is exploring for high-grade copper at its more than 2,000km square prospective ground in the Cobar region of NSW. The company is testing for mineralisation along regional-scale copper trends and has had significant success in its latest drilling campaign, which is testing the Rochford Trend (pictured below).

Since late 2021, RC drilling has been utilised to ‘scout’ drill and test prospective mineralised zones.

In mid-September 2022, Helix completed 27 RC holes for 4,275m drilled. The campaign was designed to test copper-lode targets in the Greater Canbelego area, the West Lodes, the previously untested Shango target, a VTEM target, and several surface geochemical anomalies along the shear corridor, as well as the Caballero prospect, which is located 2.5km south of Canbelego Main Lode.

As part of this campaign the Caballero prospect received its first drilling campaign in 8 years with several RC holes which were drilled to follow-up historical intercepts.

Of particular interest, the company has uncovered ‘high-grade’ results at the Canbelego joint venture (70% Helix / 30% Aeris Resources). The Canbelego Main Lode has yielded exceptional massive sulphide results with CANDD002 retuning 14m @ 4.4% Cu. This occurred in May 2021, some 8 years after Helix’s first diamond core drilling at Canbelego since 2013.

This week, Helix updated the market on the recently completed ‘daughter hole’ testing a large DHEM anomaly at Canbelego. Significant DHEM, conductive targets were discovered from 2, deep ‘parent’ holes – CANDD015 and 016 – which demonstrated the down-dip continuity of the Main Lode for a further 400m below the base of the 2010 Mineral Resource.

The company says these large-scale, highly conductive targets are interpreted as high-grade copper shoots plunging within the overall shear zone hosting the Canbelego copper mineralisation.

Helix Table

Rosenstreich notes: “The team and I remain highly confident and excited about the prospectivity at Canbelego and, indeed, our wider tenement holdings. Fortunately, we have a strong cash position and are very well positioned to make major discovery inroads in 2023.”

Following this success, the company continues to test the Main Lode, encountering further mineralised shoots. Rosenstreich says this is consistent with Cobar-style mineralisation, which is found at other nearby major copper operations such as the CSA Copper Mine.

“Cobar-style mineralisation consists of mineralised pipes with a small footprint but long depth extents that typically don’t reach surface.

“What we’ve found is consistent with Cobar-style mineralisation in terms of the structural setting including the intersection of regional scale fault and local faults”

What we’ve found is consistent with Cobar-style mineralisation in terms of the structural setting including the intersection of regional scale fault and local faults. Also, it’s a late stage, structurally controlled vertical system with multiple lodes, which we have now defined to more than 600m vertical depth. We’ve more recently identified potential high-grade shoots. CSA is high-grade, very deep, and has multiple lodes with similar late structural setting.

Also, the grade – grade is king as they say. And the vertical nature of the lodes lends itself to cheap, highly productive underground mining methods, so we are very keen to scope out this style of deposit.”

CSA is an established, ‘high-grade’ producing copper mine that is expected to produce more than 40,000 tonnes of copper in 2022 with an estimated current mine life of more than 15 years. In 2021, CSA produced 41,000t of payable copper and 459,000oz of payable silver, with normalised C1 cash cost of US$1.72 per pound of copper.

The CSA ore grade averages over 5% with some as high as 12%, making it one of the richest copper ore deposits in the world.

As Rosenstreich notes, at the Canbelego Main Lode drilling in October this year at the South Shoot position has identified comparable grades, including 16m @ 3.21% Cu from 117m downhole (CBLRC057) including 11m @ 4.58% Cu.

The MD says this is the highest-grade copper intercept in the upper 150m of the Main Lode to date, confirming potential for exceptional copper mineralisation at shallower depths, while the discovery also remains open at depth and to the south.

At the North Shoot, Helix intersected 14.3m @ 1.96% Cu from 417m downhole (CANDD012) including 8.3m @ 2.82% Cu.

Rosenstreich adds: “Following these impressive results, Helix is currently undertaking bold, expansive diamond drilling testing 200m beneath currently known mineralisation to ‘map’ the extent of the copper lodes and establish a downhole electromagnetic survey platform.

This drilling consists of 2 diamond holes to a vertical depth of 550m depth to test the extensions of the system – in one large 200m step down.”

DHEM could blow potential of Canbelego wide open

The intersections that Helix is starting to uncover at Canbelego has certainly piqued the interest of the company and the wider market, which the MD says has been 10 years in the making.

Rosenstreich says Helix ceased drilling around Canbelego in 2013. Since resuming in April 2021, it has been intercepting the highest grades ever hit below the existing, 2010 Inferred Mineral Resource – highlighting the potential for high-grade extensions to depth.

“Recently we discovered several large-scale, highly conductive targets which are indicative of high-grade shoots. Also, limited regional target assessment has highlighted significant regional potential such as the Caballero Prospect.

“Recently we discovered several large-scale, highly conductive targets which are indicative of high-grade shoots”

We think we are getting onto the structures and the orientations which control the distribution of high-grade copper mineralisation in an overall envelope of lower grade in the broader shear zones. There is potential to trace these out at shallow depths but we might now be starting to define them at depth – using the DHEM.

The ‘bold holes’ stepped down 200m vertical to learn ‘once and for all’ the vertical continuity of the system. The visual copper sulphides intersected in holes 15 and 16 support the host shear zone persisting down at least 600m vertically from surface.

But…more exciting, the DHEM is showing very strong conductive targets never been intersected by drilling and extending even deeper. This could blow the potential of Canbelego wide open if the DHEM conductors represent massive chalcopyrite (copper sulphide).”

Helix mining in Cobar

Rosenstreich notes, however, that while Helix is generating positive results from drilling that warrant further investigation, the company still has a long road ahead before it fully understands the potential of Canbelego.

As such, Helix has started a regional scale geochemical sampling program, which has been designed to build up more regional targets. Other objectives include obtaining consistent regional scale geochemical data to vector into deposits and complement the regional VTEM survey Helix flew in early 2021.

Exploration a numbers game

The MD says: “Exploration is a numbers game – most targets fail. So, the more targets you test the greater chance of success. With a strong treasury, we can afford to ‘fail’ as long as we learn and refocus and improve the rate of positive hits.

“We’re getting positive hits at the Canbelego Main Lode, CBW2, and possibly at Caballero – that’s not a bad strike rate and we haven’t really started to test our best regional targets”

We’re getting positive hits at the Canbelego Main Lode, CBW2, and possibly at Caballero – that’s not a bad strike rate and we haven’t really started to test our best regional targets due to the weather constraints.”

In March, the company’s treasury was topped up when Helix completed a $13m equity raising to accelerate exploration. The funds raised are going towards furthering Helix’s copper discovery activities along the Rochford trend, as well as the nearby Collerina trend.

With $10.5 million cash at hand as of the end of the Q3 2022, Helix plans to deploy some of that capital early in 2023 towards some high-priority targets.

Addressing the company’s war chest, Rosenstreich says while Helix will be bold and ambitious, the company will be fiscally responsible, nonetheless.

“A lot depends on how these drill tests of the DHEM plates go at Canbelego over December and January when we restart drilling. Fingers crossed – we have some hard decisions to make.

“Otherwise, a 50:50 spend between advanced targets – CZ deposit (pictured above) and Canbelego and regional targets. We have some very high-priority targets supported by VTEM and geochemistry which we haven’t been able to test for over a year due to rain and cropping activity, so we have to assess these.”

At the Canbelego Main Lode project, subject to no further delays from either weather events or mechanical issues, Helix intends to complete more drillholes prior to the Christmas shutdown period.

Work is then planned to resume on site on 9 January 2023.

Write to Adam Orlando at Mining.com.au

Images: Helix Resources Ltd & iStock
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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.