Kobrea Exploration (CSE:KBX) has entered into an alliance agreement with BHP’s (ASX:BHP) subsidiary BHP Metals Exploration to jointly advance exploration across the Western Malargüe Copper projects in Argentina.
Under the agreement, Kobrea and BHP Metals will form a strategic exploration alliance to conduct generative and advanced exploration across the projects.
BHP Metals will make an advance one-time cash payment of US$3 million ($4.25 million) to Kobrea upon starting the agreement. BHP Metals will also fund a minimum of US$5 million in exploration expenditure over an initial two-year period, as part of the project generation phase.
During the project generation phase, BHP Metals may designate up to four separate projects, in aggregate, to advance into individual earn-in phases. For each designated project, the company will have the option to earn a 75% interest by sole funding a minimum of US$40 million in exploration expenditures over eight years.
Kobrea will serve as operator during the two-year project generation phase, after which BHP Metals may elect to assume operatorship. Upon completion of the earn-in, both companies will establish a joint venture, in which BHP Metals and Kobrea will hold a 75% and 25% interest, respectively.
District-land package
Kobrea CEO James Hedalen says this alliance represents a milestone for Kobrea and shows confidence in the Western Malargüe Copper projects and the work completed to date.
“Our team has assembled an exceptional district-scale land package and identified numerous compelling porphyry copper targets across the project portfolio,” Hedalen says.
“Partnering with one of the world’s leading mining companies brings the technical expertise, global best practices and financial strength needed to systematically evaluate and responsibly advance these projects.”
The Western Malargüe Copper projects cover 73,334 hectares in the western Mendoza Province of Argentina. The project area hosts over 12 porphyry copper and porphyry copper-gold prospects.
BHP Metals is part of the mining giant BHP and is responsible for identifying and evaluating new mineral exploration opportunities that can support the future growth of the business.
Kobrea Exploration is a mineral explorer and developer focused on acquiring and discovering base metal projects.
Write to Aaliyah Rogan at Mining.com.au
Images: Kobrea Exploration
