BHP has turned down the right to purchase the Kalkaroo copper project from Havilah Resources, which it earned with the $9.6 billion takeover of OZ Minerals.
Kalkaroo is a large-scale open pit copper-gold-cobalt project in South Australia. The project contains 1.1 million tonnes of copper, 3.1 million ounces of gold and 23,200 tonnes of cobalt in measured, indicated and inferred JORC mineral resources.
BHP has been focusing efforts on developing South Australia as a copper powerhouse. However, after an internal review of its growth projects, BHP declined the option to purchase Kalkaroo.
“We thank Havilah for giving us this opportunity to work together with them on understanding the opportunities of this project,” BHP vice president of copper growth in South Australia, Michelle Ash, said.
“We believe that Kalkaroo is an attractive copper asset that will be developed, but our focus is on optimisation of the Gawler Craton copper assets in northwestern South Australia.”
It is understood that BHP will instead prioritise consolidating OZ Mineral’s Carrapateena and Prominent Hill copper mines with its own copper operations in the state.
Havilah, meanwhile, retains full ownership of all surrounding exploration areas, where drilling has returned encouraging results from four copper prospects within 15 km trucking distance of Kalkaroo.
“The work completed by BHP and OZ Minerals has confirmed and enhanced Havilah’s earlier pre-feasibility study work, most notably in improved copper recoveries and concentrate grades from sulphide ore and a longer conceptual open pit mine life,” Havilah’s board said.
“The planned resource expansion drilling at Kalkaroo was not undertaken and remains a significant potential upside for the project.
“We believe that the rarity of large undeveloped open pit copper projects in low sovereign risk jurisdictions like South Australia with the benefits of scale, favourable logistics, land ownership, renewable energy possibilities and the near record copper and gold prices, underscores Kalkaroo’s attractiveness.”
It is understood that Havilah has engaged Deutsche Bank to assist in approaching parties who have expressed an interest in Kalkaroo.
Subscribe to Australian Resources & Investment and receive the latest news on commodity prices, resource developments, executive movements and more.