RareX partner Kincora Copper kicks off Lachlan Fold Belt drilling
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Special Report: RareX’s Canadian partner Kincora Copper has kicked off a six-hole deep drilling program aimed at unlocking the potential of their Lachlan Fold Belt projects.
The Lachlan Fold Belt has seen renewed interest since Alkane made its Boda copper-gold porphyry discovery late last year, prompting a deluge of explorers looking to find the next big hit in this highly prospective region of New South Wales.
Having carved out a 65 per cent stake in its LFB projects to Kincora Copper in return for an upfront payment and a free carry on exploration for its remaining 35 per cent interest, RareX (ASX:REE) now has minimal risk leverage to any successes from the drilling campaign at the Trundle project.
Trundle is unique among the various plays in the region as it is the only brownfield project held by a listed junior. Brownfield projects are located in the same mineral complex as existing mines and generally offer greater odds of exploration success.
There is also little shortage of potential prospects given its location within the same mineralised complex as the Northparkes copper-gold mine, Australia’s second largest porphyry mine in what is arguably the country’s most exciting porphyry region.
While just 11, or 0.5 per cent, of the historic holes drilled by previous explorers drilled below 300m, the shallow holes have nonetheless proved the presence of both gold and copper within the project with results of 56m at 0.88 grams per tonne (g/t) gold and 0.35 per cent copper from a depth of 34m.
The six-hole campaign will test three known, large and mineralised targets with significant previous drill intersections in a bid to discover a new cluster of porphyry deposits.
Kincora president and chief executive officer Jonathan (Sam) Spring told Stockhead that the company was trying to find new finger porphyry-type deposits.
“Across the complex over at Northparkes, there are effectively five of these deposits that are economic and either been mined or expanded at very favourable returns,” he explained.
“Hopefully, a new cluster is concealed in the porphyries (we are drilling).”
Spring added that in the event that the companies enjoyed exploration success and moved into a mine development scenario, the project was in a very favourable position.
“We have got existing rail, power, we have the Trundle township on the actual licence, we have Northparkes sitting 30km away, we have Clean Teq’s nickel-cobalt Sunrise project, which from a job and capital perspective is as big as Northparkes, 30km the other way.”
He also pointed to the breadth of experience that Kincora’s team brought into the fray.
“You have got John Holiday, who was the lead discoverer of Cadia, and really wrote the geological model for what we are looking for in this belt, and we have Peter Leaman who is credited with the discovery of Reko Diq porphyry in Pakistan and other tier 1 projects.
“So at the stage that we are at, there are no guarantees but we have got a lot of smoke, we have got the right targets, we have the right team behind that.”
There are ample reasons for RareX and Kincora to be excited about any potential success given the share price appreciation that existing explorers enjoyed after Alkane Resources (ASX:ALK) made its Boda discovery.
During the period from September 6, 2019 to the ASX market peak on February 20, 2020, the combined market capitalisation of companies such as Alkane, Alice Queen (ASX:AQX), Krakatoa Resources (ASX:KTA) increased from circa $250m to nearly $700m.
Given RareX’s current market capitalisation of about $9.4m, its significant, yet low-risk exposure to Kincora’s drilling program offers it significant leverage to any exploration success and diversification from its core Cummins Range rare earths project.
Drilling has started at the Trundle Park prospect where prior activities have intersected very high-grade localised zones within a large lower grade skarn magnetite skarn, similar in style to the Big Cadia skarn that is peripheral to the Cadia porphyry copper-gold deposits.
No drilling has tested below these mineralised holes where geophysics and relogging of historic drilling has indicated proximity to a porphyry source.
Kincora will also test the Mordialloc target, which has metal grades comparable to the peripheral parts of the Northparkes deposits.
Prior drilling has returned porphyry quartz sulphide veins while one deeper diamond hole on the periphery of the subsequently defined chargeability high outer shell intersected 48m at 0.15 per cent copper, 0.12g/t gold and 41 parts per million molybdenum from 478m.