OZ Minerals is expanding its base metals exploration portfolio after executing a farm-in agreement with Minotaur Exploration at the Peake and Denison tenements in South Australia.
Located on the edge of the Gawler Craton, Peake and Denison is an under-explored section of South Australia where only 23 historic drill holes have been penetrated on prospective zones across the 2500-square-kilometre region.
Exploration prospects lie under 100-350 metres of younger cover sediments, where there’s the potential for iron-oxide-copper-gold (IOCG) type mineralisation.
Initial findings have presented similar characteristics to the Cloncurry region of Queensland, where South32’s Cannington silver-lead mine and Evolution Mining’s Ernest Henry copper-gold operation are located.
OZ Minerals will be required to spend $839,300 on exploring Peake and Denison in the first year of the joint venture (JV).
The company can then earn an initial 51 per cent interest in the project if the company invests $4 million across the next three-year period.
If successful to that point, OZ Minerals can earn a further 19 per cent interest if it spends an extra $6 million in the three years following that, culminating in a 70 per cent interest in the project.
OZ Minerals also shares the Jericho and Eloise exploration projects with Minotaur in Queensland, as well as Breena Plains, which also involves Sandfire Resources.
Minotaur managing director Andrew Woskett said Peake and Denison further solidified its partnership with the Tier 1 miner.
“OZ Minerals continues to be a supportive partner of Minotaur, the working relationship enduring across many years and we welcome their new involvement,” he said
“The project is a true frontier exploration play that covers most of the prospective Peake and Denison inliers, providing ready access to a large, poorly explored terrain. The geology provides an excellent joint venture first-mover opportunity for exploration success.”
It comes after OZ Minerals boosted its gold production guidance for the 2021-22 financial year after stockpiles at the Prominent Hill mine in South Australia delivered higher grades.
The company’s gold guidance for the 2021 financial year increased from 205,000 to 228,000 ounces to 220,000 to 243,000 ounces.
Gold production increased from 57,875 ounces in the June quarter to 65,932 ounces in the September quarter.