Castillo considers spin-out at Broken Hill

Perth-based Castillo Copper is considering divestment opportunities for a “sizeable” asset in NSW, including a potential spin-out into a new listed entity.

The decision followed a strategic review and a resurgence of interest in groups with footprints around the Broken Hill region, Castillo said this morning.

Its Broken Hill Alliance (BHA) asset includes fellow explorers Impact Minerals and its major shareholder, Andrew Forrest's Wyloo Metals (formerly Squadron Resources), which together hold a large footprint within the region.

Castillo said BHA’s tenure was highly prospective for both silver-lead-zinc and iron-oxide-copper-gold mineralisation, with the latter tenements acquired from Wyloo in September last year.

That has generated numerous high priority targets and a significant pipeline of exploratory work, Castillo said.

The company will now consider a possible spin-off of BHA into a new entity that could be listed on either the Australian or London stock exchanges. The board is now liaising with its UK corporate adviser, SI Capital, on the matter.

Castillo London-based director Ged Hall said the BHA project was an excellent asset and would be well received and supported by UK investors.

The move would also allow Castillo to focus on developing its flagship Mt Oxide copper project in north-west Queensland, where the company recently reported positive drilling results from its Big One Deposit.

That included 40 metres at 1.64 per cent copper and 44 metres at 1.19 per cent copper.

Castillo also has four copper projects in Zambia, covering 1,100 square kilometres.