Sultan teams up with mining major Rio to find the next tier 1 nickel deposit
Sultan has welcomed Rio Tinto as its partner on tenement E70/5082 at Sultan’s Lake Grace project in WA after the mining giant exercised their farm-in option and drill a significant EM anomaly identified by a recent heli-borne survey.
Always eager to find the next tier 1 critical mineral deposit, Rio Tinto (ASX:RIO) signed an option and joint venture agreement in June with Sultan Resources (ASX:SLZ) to earn up to 80% of E70/5082 by spending $2m on exploration over five years.
Rio was drawn to the tenement after identifying a strong untested late time conductivity anomaly from a single line SKYTEM response in its north from 20km line-spaced data that is coincident with a circular magnetic and radiometric anomaly.
This anomaly was interpreted to have the potential to host magmatic nickel sulphide mineralisation.
It was certainly intriguing enough for Rio to fly a detailed 100m line spaced helicopter borne EM survey totalling about 80 line km over an area about 4km southwest of Kulin town.
The detailed EM survey was aimed at confirming the nature and extent of the conductivity anomaly before considering the merits and nature of any on-ground exploration to further assess and test the anomaly.
“The anomaly has stood up well to the more intense heli-EM survey after initial identification from the SkyTEM 20km EM lined spacing survey,” non-executive director Jeremy King told Stockhead.
“We are working with Rio to finalise the plan for drill testing of the anomaly. This will be 100% funded by Rio with Sultan likely to manage it on behalf of the JV having established the local relationships. It is shaping as a great target and a potentially transformational drill programme for the Company.”
Rio has now chosen to exercise the option to earn 80% in E70/5082 after the EM survey outlined an area of significant EM conductivity response over 750m in length and 230m in width, which may resolve to two targets.
Encouragingly, both Sultan and Rio consider that the geological setting and EM response from the new survey are suggestive of potential for magmatic nickel sulphide mineralisation.
Preliminary modelling of the target has now being completed with target depths for the modelled plates starting from about 70m below surface while planning for initial reverse circulation drilling to confirm the nature of the anomaly is underway.
Sultan has also applied for open ground contiguous with E70/5082 around the current area of interest, with three tenements (E70/6529-31) totalling 17 blocks having since been granted.
This article was developed in collaboration with Sultan Resources, 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.