PERTH (miningweekly.com) – Copper/gold miner Oz Minerals and junior Cassini Resources have formalised a joint venture (JV) to potentially develop a new copper and nickel asset in Western Australia by 2020.
In terms of the JV agreement, which was fist announced in August but signed on Thursday, Oz Minerals will earn up to 70% of the West Musgrave copper and nickel project by sole funding a minimum of A$36-million on development and exploration.
The agreement includes continued studies on the Nebo-Babel deposit to progress it to a decision to mine, as well as regional exploration spend of up to A$8-million to assist in identifying additional value adding opportunities.
The JV parties have launched a A$3-million scoping study at the West Musgrave project, which will set out the appropriate size of any future mine, along with the optimal infrastructure solutions to undertake the project. The study is due for completion in September next year.
“A key part of our initial scoping study is the development of a geometallurgical model for the Nebo-Babel deposit, which will determine the scale of future mining operations to extract the best overall value,” said Oz Minerals CEO Andrew Cole.
He added that the start of the scoping study opened up the door for a major new asset to potentially be in place as early as 2020.
The West Musgrave project comprises the Nebo-Babel nickel and copper sulphide deposit, as well as the Succoth copper deposit.
If Oz Minerals proceeds with the farm-in and JV following the scoping study, the company will commit to spend A$15-million on a prefeasibility study and A$4-million in further regional exploration to earn an initial 51% interest in the project.
An additional investment of A$10-million can be made towards a feasibility study and another A$4-million in regional exploration, to earn the company a 70% interest in the project.