Castillo gets closer to finalising copper sales deal with major Noble Group
Special Report: Castillo Copper is getting closer to a binding deal to supply major Hong Kong-based commodities trader Noble Group copper from the stockpiles at its Cangai mine.
Castillo (ASX:CCZ) and Noble have already signed a memorandum of understanding to work quickly towards a formal deal that would see Noble exclusively sell up to 200,000 tonnes of copper concentrate from the existing stockpiles at Cangai.
Castillo has now taken samples from the stockpiles around the mine and sent them off to a specialist metallurgical group for independent verification and optimisation.
Investors welcomed the news, pushing shares up over 7 per cent to 3c on Tuesday morning.
“Behind the scenes, CCZ’s various teams have been working extremely hard to progress the board’s strategic agenda to re-open Cangai copper mine,” chairman Peter Meagher said.
“Once the metallurgical results for the various stockpiles are returned, we hope to finalise our agreement with Noble Group, as this will be an important source of early stage cash flow.”
The company has been advancing its plans to monetise the legacy stockpiles after metallurgical test-work confirmed copper concentrate recoveries of over 80 per cent and grades up to 22 per cent copper from one of the stockpiles.
Anything over about 6 per cent copper is considered high-grade.
The project hosts five historic stock piles of high-grade ore located near the Cangai mine.
Castillo expects the new samples it has collected will show some improvement on the initial testwork conducted at the McDonoughs’ stockpile.
Meanwhile, the company is continuing its drill program targeting high-grade ore and will soon provide shareholders with an update on that and the drill-hole electromagnetic survey findings.
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