Recent red hot copper hits all part of Peel’s Cobar hub plan
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With money in the bank, projects back fully on the books and significant mineralisation in the ground, Peel Mining’s goal to be a Cobar producer looms large.
Peel (ASX:PEX) has made news recently for outstanding copper hits at the highly exciting Wirlong project, where the most recent round of resource drilling assays included a +150m copper intercept and multiple zones of more than 20m where copper grades exceeded 3.5%.
Wirlong is an important part of the Peel story – it would be impossible to return assays of that strength without being so – but it is not the only asset at play for the company near Cobar.
Peel’s vision is for a hub and spoke project, centrally processing critical mineral mass from a combination of Wirlong, the nearby Mallee Bull copper project, the May Day gold project, and the Wagga Tank and Southern Nights lead-zinc-gold-silver-copper projects.
It’s a vision accelerated by the departure over the past 18 months of Peel’s Japanese joint venture partners CBH Resources and JOGMEC at Mallee Bull and Wirlong respectively.
On the back of their regional departure, Peel consolidated ownership of each JV to take full control at Wirlong and Mallee Bull, a move which managing director Rob Tyson told Stockhead freed it up to pursue its own plans.
“Owning everything 100% means we can make our own decisions, and we could see a couple of years ago that there was logic in pursuing a new mill in our part of the world,” he said.
“We’re in Cobar, so there’s obviously other mills in the district, but most of them are close to fully-utilised except for at Endeavour, which is the furthest away from our projects and wasn’t a good fit.
“We could see we had the ingredients in the making amongst all our deposits to support a new mill, and the hub and spoke strategy really came into effect about 18 months ago when it was obvious that was the right way forward.”
Having gained full control of all the hub and spoke projects on its books, Peel’s strategy is now to work its way through, defining resources to give the critical mass it needs to progress the initiative forward.
Resource drilling is underway at Wirlong in anticipation of a maiden resource, and also at Mallee Bull, which already has a mineral resource of 6.76 million tonnes at 2.6% copper equivalent for 175,000t contained copper equivalent – one of Australia’s highest grade undeveloped copper deposits.
An indicated mineral resource of 1.07 million tonnes at 1.02 grams per tonne gold, 26.3g/t silver, 0.74% zinc and 0.5% lead was announced on May Day in March.
Announced last year, Southern Nights has an indicated and inferred mineral resource of 4.95 million tonnes at 5% zinc, 2% lead, 0.3% copper, 0.4g/t gold and 78g/t silver.
The drilling is expected to be ongoing for Peel’s projects this year, with the goal of an aggregated resource which will provide the basis for a multi-deposit concept study to underpin a long-life mining operation.
Pending results, the company hopes to have mining licence applications in for a new development by the end of calendar year 2022.
While holding a polymetallic portfolio in the Cobar region, Tyson said copper was the key focus for Peel moving forward.
“We’ve always been strong in our view that copper’s day was coming, and we could see that it was likely to be a really good, strategic place to be.
“The copper price rally over the last three-to-six months has really reaffirmed that for us, and we’re pivoting to copper.
“We can see potential for us to grow our metal exposure to copper to more than 50% of all the metals in our portfolio, and that’s a place we’re very comfortable being because we feel there’s a scarcity of good copper development stories in Australia.
Peel is well funded to pursue its goals too, having recently raised more than $20 million through a placement and rights issue to finance its exploration activities and build its hub and spoke vision for Cobar.
“We’re in the best shape the company has ever been in financially, we own everything 100% and we’re drilling high grade copper,” Tyson said.
“We’re in a pretty sweet spot.”
Tyson recently spoke with Stockhead’s Barry FitzGerald for The Explorers Podcast – catch up with that conversation here.
This article was developed in collaboration with Peel Mining, 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.