It’s not often you get a big, largely Australia-focused copper producer to agree to spend millions on a zinc project in Alaska — but that’s just what White Rock Minerals (ASX:WRM) has done.

  • Scroll down for the ASX’s other base metals movements today.

The $1.1 billion Sandfire Resources (ASX:SFR) has inked a deal that will see it sink potentially as much as $30m into White Rock’s Red Mountain project in exchange for up to a 70 per cent stake.

The news sent shares up 20 per cent to 0.6c on high volume trade straight after market open on Monday.

Sandfire can earn an initial 51 per cent stake by spending $20m on exploration over four years, with at least $6m of that to be spent this year.

The heavyweight can increase its interest to 70 per cent by spending another $10m and delivering a pre-feasibility study, including a reserve, within another two years.

Mineral reserves are resources known to be economically feasible for extraction.

Managing director Matt Gill said the deal will fund the Red Mountain project right through to advanced development studies and allow White Rock to retain a 30 per cent stake.

“Our small market cap and the size of their JV investment are testament to the value that can be added here,” Mr Gill told Stockhead.

“Their balance sheet dollars applied to our project is a great non-dilutive funding outcome for WRM shareholders.”

Sandfire’s interest in the 475-sq-km Red Mountain project may have something to do with the extremely high grades and the fact it is also a volcanogenic massive sulphide (VMS) deposit.

VMS deposits are a type of large metal sulphide ore deposit, mainly copper and zinc, that range in size from 4 million to 25 million tonnes.

Mr Gill said that besides being a copper producer, Sandfire is also predominately a very successful VMS explorer, developer and miner.

Sandfire’s DeGrussa and Monty mines are VMS deposits.

“They also seek district scale opportunities — our high-grade zinc and precious metals VMS project meets this criteria,” Mr Gill said.

On top of that, Alaska was ranked number five in the world for mining investment in the Fraser Institute’s most recent survey.

Red Mountain currently hosts two high-grade deposits with an inferred resource of 9.1 million tonnes at 12.9 per cent zinc equivalent for 1.1 million tonnes of contained zinc equivalent.

Mineral resources are categorised in order of increasing geological confidence as inferred, indicated or measured.

Mid-last year, Red Mountain yielded extremely high grades of 19.5 per cent zinc and 1435 grams per tonne (g/t) of silver during initial drilling.

Anything over 10 per cent zinc and 50g/t silver is considered high-grade.

In other base metals news today:

 

  • Mod Resources (ASX:MOD) has upped the reserve for its T3 project in Botswana by 61 per cent to 34.4 million tonnes at 1 per cent copper and 13.2g/t silver.
    The latest update to the reserve also increases the contained copper by 57 per cent and the contained silver by 107 per cent.
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  • ARC Exploration (ASX:ARX) is acquiring Cyprium Australia because it wants the private explorer’s 80 per cent earn-in interest in Musgrave Minerals’ (ASX:MGV) Cue copper project in WA.Cyprium’s founders include Gary Comb and Barry Cahill — who were forced out of junior copper explorer Finders Resources (ASX:FND) last year after hostile suitor Eastern Field Developments won control of the company.If the deal goes ahead, Mr Comb and Mr Cahill will join ARC’s board as non-executive chairman and executive director respectively.
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  • Axiom Mining (ASX:AVQ) has had to delay a planned capital raising while it answers some questions from ASIC.The company told investors today that the regulator wants to know why it has started mining its San Jorge nickel deposit in the Solomon Islands despite the disclosed risks.Axiom said it will “continue with vigour” towards the first shipment of nickel.
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  • PolarX (ASX:PXX) shares have rallied 20 per cent to an intra-day high of 7.2c after the explorer revealed it had something pretty big at its Alaskan copper and gold project.The company said 3D modelling had confirmed that its Saturn prospect at the Alaska Range project is a large, “highly prospective” copper and gold porphyry target measuring 2km by 1km and extending down to at least 3km.Porphyry is rocks formed from lava or magma that has large crystals in a fine-grained mass. These types of deposits are usually quite large but low-grade