Helix can earn in for up to 80% of Central Cobar. Pic via Getty Images.
Legacy signs on Helix to explore Central Cobar’s metal potential
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- Helix to earn-in up to 80% of Legacy’s Central Cobar project by spending $2.8m
- Legacy to retain exposure while turning focus to copper prospectivity nearby
- Exploration in the region is growing on the back of AGC’s Achilles discovery
Special Report: Legacy Minerals and Helix Resources are looking at drilling into numerous untested targets at the Central Cobar project, forming a JV where Helix can earn-in up to 80% in a three-stage deal.
Central Cobar covers ~308km2 in the world-class and copper-rich exploration and mining district in NSW, just 10km from both the Metals Acquisition’s (ASX:MAC) CSA copper and Aurelia Metals’ (ASX:AMI) Peak gold-copper-silver-zinc-lead mines.
In the binding agreement, Helix Resources (ASX:HLX) can spend $2.8m to earn an 80% interest in Legacy Minerals’ (ASX:LGM) Central Cobar EL9511 tenement in three stages:
Stage 1 – $0.8m over 2 years to earn a 51% interest.
Stage 2 – $0.8m over 2 years to earn a further 14% interest.
Stage 3 – $1.2m over 2 years to earn a further 15% interest (up to 80%).
Minimum commitments include 700m of drilling and geophysics within 12 months.
At each stage, LGM has the option to contribute or dilute. If LGM’s interest drops below 10%, it will convert to a 2% gold net smelter royalty or a 1.2% NSR if it’s base metal dominant.
On the heel of Achilles
The Cobar region is a hive of exploration activity lately, ever since Australian Gold and Copper (ASX:AGC) announced the Achilles discovery in the southern end back in April, containing some seriously high grades of shallow gold, silver, copper, lead and zinc.
Highlight grades at the time included 5m at 16.9 g/t gold, 1667g/t silver, 0.4% copper and 15% lead-zinc from 112m.
Planned work
Untested drill targets are the focus of upcoming exploration and HLX is in the process of planning ground geophysical surveys over up to three of the highest priority AEM targets – Woggle, Xcite 6 and 40060A.
Drill planning is to commence as soon as possible and the explorer will follow-up AEM and geochemical targets as well as others LGM has already generated.
LGM CEO Christopher Byrne says the company is looking forward to the discovery-focused partnership with HLX covering Central Cobar.
“The project is strategically located and has a largely untested ground package with excellent geological prospectivity,” Byrne says.
“The Helix team has extensive knowledge and experience in the Cobar region and their long-term commitment to the district gives them an edge in the search for Cobar-type deposits and operational efficiencies, and we believe they are the right partner to take the project forward.”
Byrne says the deal represents an exceptional opportunity to discover Cobar-type deposits within a stone’s throw of Aurelia’s operating mill, while being able to pivot towards its other nearby exploration options.
Legacy to turn focus
“This agreement will focus on unlocking Central Cobar’s potential while allowing Legacy to remain focused on the discovery opportunities at our 100%-owned Drake, Black Range and Thomson projects,” Byrne says.
Drake is an advanced, 23Moz silver, 356,000oz gold epithermal project with two granted and one pending license application which contain significant, untested copper targets.
Black Range has a low-sulphidation epithermal system with limited historical exploration, but does have an identified widespread geochemical anomalism where rock chips showed silver mineralisation of up to 1440g/t.
Thomson contains identified belt-scale copper potential with several large and untested magnetic and gravity targets.
It’s not the first time LGM has farmed out projects in the district, with $28.3m worth of free carried exploration funding ongoing across three JVs on their books. That is helping the junior punch well above the weight of its $21m market cap.
Newmont is spending up to $15m to earn into the Bauloora’s copper project, Earth-Ai Alliance is drill testing a newly discovered PGE-Ni sulphide system at Fontenoy and S2 Resources (ASX:S2R) is testing a porphyry copper-gold target at Glenlogan, with drilling underway.
This article was developed in collaboration with Legacy Minerals, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
