Silver City Minerals Ltd is fast tracking exploration on the Copper Blow copper gold‐cobalt project which exhibits Iron Oxide Copper‐Gold style mineralisation that is uncommon in the Broken Hill province. After raising $2m at 4 cents per share in a recent placement, the Company is fully funded to commence the Phase 2 drilling programme. If this drilling programme is successful, it could have significant ramifications for the economics of the project as well as the potential for further discoveries along the 4 km trend.
Recapping from our research report issued in August 2017, Silver City Minerals (“SCI”) is an ASX listed company that was formed in 2008 to explore the Broken Hill province. It has an enviable land position covering 1,586 km2 which was aggregated from tenements that were previously owned, under joint venture or purchased by the Company (See Figure 1). The district has been centred on Broken Hill deposit which has been mined continuously for over 120 years and readers will recall that it has spawned major mining companies such as BHP and CRA (predecessor to Rio Tinto).
As we noted in our August 2017 report, the Company had identified a significant opportunity with the Copper Blow prospect with subsequent exploration having been a game changer for the Company and has led to a doubling of the share price since our initiation coverage.
Ongoing exploration has delivered encouraging drill intersections which are documented later in this report. However the drilling also has intangible value in the increased understanding of the mineralisation trends within the deposit by management. Indeed the recent development of some conceptual theories which may deliver significant value to shareholders and will be tested in the current drill programme. Again readers will recall that the Company has a strong geological focus with three Board members being geologists including MD Chris Torrey and Chairman Bob Besley.
The Copper Blow mineralisation is typical of Iron Oxide‐Copper‐Gold (IOCG) orebodies such as Olympic Dam, Ernest Henry and Selwyn. It represents a new target in the Broken Hill province beyond the Copper Blow prospect although the Company’s focus is clearly to define the Copper Blow orebody to produce a JORC 2012 compliant ore resource statement.
Breakaway Research believes that the drilling results to‐date have probably already confirmed that Copper Blow represents an economic proposition
under a development scenario involving open pit mining, ore hauling to Broken Hill and toll treating through either the CBH Resources or Perilya plants.
Nevertheless the Company will also continue drilling to determine whether the actual resource potential could mean that it can support its own processing
plant on site in the future.
Official website: www.silvercityminerals.com.au
ASX on Hotcooper: http://hotcopper.com.au/asx/SCI