Pilbara copper and nickel producer Fox Resources Ltd’s major shareholder, Terry Streeter, has dropped a further $400,000 into the company’s Whundo prospects following some spectacular zinc drilling results there.
The loan from Mr Streeter’s Jungle Creek Gold Mines Pty Ltd was part of a $2 million facility this month that will be used primarily to drill Fox’s Ayshia zinc prospect following a 14-metre intersection grading a high 10.4 per cent zinc from 30 metres.
The hit gives added weight to the company’s plan to build an expanded base-metals project around its strategic mill at the flagship Radio Hill underground copper-nickel operation near Karratha.
The expansion is predicated on the mill’s nearly completed $1 million upgrade, a new open-pit mining reserve containing 8,000 tonnes of copper worth about $8 million at nearby West Whundo, and the high grade Ayshia zinc intercepts, also close by.
Radio Hill has a production rate of about 240 tonnes of nickel and 140t of copper a month, which is taken by major Chinese nickel producer Jinchuan Group Ltd. However, its production in the March quarter was hit by cyclone activity and fell to 341t of nickel and 471t of copper.
Jinchuan is providing a $4 million loan to develop the West Whundo copper zinc project, 10km south of Radio Hill, where open-cut copper production is expected to start next month.
As an indication of what commodity prices have done recently, the feasibility study was based on a copper price that has since doubled to over $A1,000 a tonne and a zinc price up from $2,900 a tonne to $4,680/t. Hence the excitement over Ayshia.
Midas Resources Ltd is carrying Mr Streeter’s international mining aspirations into Alaska and China, but its most advanced project is the 437,000-ounce Lake Carey gold project, 80km south of Laverton.
The company is looking at a feasibility study beginning at the end of this year followed by a decision to mine mid-2007 if the study points that way.
Production options include trucking ore to any of three nearby mills, buying a 1mt/year plant or building a new one with other nearby potential producers.
In Alaska, Midas is targeting multi-million ounce gold systems in the Tintina gold belt where recent drilling has yielded some high grade hits over more than six metres.
Current exploration in China is aimed at gold, nickel and platinum group elements at Shimian and Dali, with an eye to the acquisition of other advanced projects.
