Red Hill Minerals (ASX:RHI) and Peel Mining (ASX:PEX) subsidiary Peel Far West have entered into a $6.5 million five-year farm-in agreement for exploration at the Curnamona Project, which straddles the New South Wales and South Australian border.
The Curnamona Project, which covers a 1,460km2 area, is host to the “highly prospective” Wilyama Supergroup and occurrences of interpreted Broken Hill-type mineralisation and is considered prospective for tier one zinc-lead-silver deposits.
Under the conditional binding heads of agreement, Red Hill, which has a market capitalisation of $492.38 million, may earn a 75% interest in Curnamona by incurring $6.5 million in exploration expenditure during the farm-in period.
Subject to satisfying certain conditions, the company is expected to spend a minimum $1.5 million within the first two years, prior to withdrawal.
Upon earning a 75% interest, a joint venture will be formed with Red Hill being the manager, and Peel Far West holding the remaining 25% interest.
From that stage onwards, funding will revert to a standard contribute or dilute arrangement.
Red Hill executive Chairman Joshua Pitt says Curnamona provides the company with an opportunity to explore for zinc-lead-silver deposits throughout the prospective Broken Hill region and an opportunity to advance a proven copper target at Anabama in South Australia.
“Red Hill is looking forward to working closely with Peel to apply systematic and innovative exploration approaches to unlock value from these tenements,” he says.
“The company is excited to progress exploration of the Curnamona tenements in parallel with the West Pilbara Gold and Base Metals Project and will continue to assess future projects to add to the exploration portfolio.”
Peel Mining Technical Director Rob Tyson says previous historic drilling at Curnamona has intercepted occurrences of Broken Hill-type mineralisation, which suggests a potential that could be hidden beneath the cover.
“The Anabama tenement in South Australia contains the underexplored namesake Anabama copper prospect and here Peel sees good potential for the discovery of a large-scale, near-surface copper deposit,” he says.
The Anabama tenement in South Australia lies within the under-explored Boucat Volcanics of the Adelaide fold-thrust belt. The Anabama prospect is considered an outcropping gold-copper deposit.
Red Hill Minerals is a gold and battery metals explorer which has several projects in Western Australia. The company’s assets include the West Pilbara and Pannawonica projects, alongside the Three Peaks hard rock deposit.
Peel Mining is an advanced base and precious metals explorer focused primarily on copper. The company holds two projects in Australia and has a market capitalisation of $75.54 million.
Write to Aaliyah Rogan at Mining.com.au
Images: Red Hill Minerals
