Castillo flags Broken Hill divestment to focus on Big One copper
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Castillo Copper (ASX:CCZ) is considering a number of divestment strategies for its Broken Hill assets in New South Wales just months after acquiring them to focus on its Big One copper deposit in Queensland.
In September 2020, the company agreed on terms to pick up the Broken Hill assets, which are close to the world-class Broken Hill silver-lead-zinc deposit and are prospective for Broken Hill-type (BHT) zinc-silver-lead and iron oxide-copper-gold (IOCG) style mineralisation, from private group Wyloo Metals.
It noted at that time that most of the new BHT and IOCG targets uncovered by its advanced predictive geological model are at a relatively shallow depth and that planning and kicking off a drilling campaign could be achieved quickly.
However, a combination of factors has led to the company considering divestment opportunities such as a spin-off of the assets into a new vehicle that could be listed in either London or Australia.
The first factor is the successful drilling at its Big One deposit where the most recent work has returned assays of 40m grading 1.64 per cent copper from surface including 11m at 4.4 per cent copper from 24m and 44m at 1.19 per cent copper from surface including 14m at 3.55 per cent from 27m.
These build on early high-grade intercepts, leading the company to say that Big One is a shallow, high-grade copper-cobalt system that could potentially scale further.
Castillo Copper also noted that the resurgence of interest in groups with footprints around the Broken Hill area along with the prevailing base and precious metal upcycle meant that it was the right time to fast track the creation of shareholder value.
Consolidated Zinc (ASX:CZL) has updated its offtake contract with Industrias Penoles S.A. de C.V. (Penoles) to reduce the transport costs associated with concentrate from its Plomosas project in Mexico.
The revised agreement will also reduce treatment charges whilst increasing net smelter returns.
Penoles also has the option to extend the contract to buy 100 per cent of Plomosas zinc concentrate by another year to 31 December 2023.
In the September 2020 quarter, Consolidated sold 811t of zinc and 245t of lead in concentrate from the Plomosas project.