Southern Hemisphere Mining (ASX: SUH) says it has unveiled a significant zone featuring the valuable molybdenum mineral at its Llahuin copper-gold play in Chile after reassaying pulp composites from some 4500m of historic drilling at the site.
The company was drawn into the recent pulp compositing campaign because the past drilling was not tested for moly – which is worth about five-times, pound-for-pound, than that of the existing copper price.
Management says the full catalogue of results has now been returned and demonstrates the substantial moly plot within its Central Porphyry deposit that sits within a ring-like zone around the edge of the main porphyry. The most compelling moly intercepts show 150m at 375 parts per million from 20m including 20m at 2080ppm from 80m, 20m at 756ppm from 110m and 70m at 256ppm from 80m, all from separate drillholes.
Chile is the world’s leading copper producer and one of the globe’s most prospective regions for major new copper discoveries. However, the abundant number of copper epithermal systems throughout the country are increasingly being sought after for their added moly byproduct value.
The moly price is currently sitting at about $68,500 per tonne, compared to copper at $13,550 a tonne. Given moly’s significant value edge, it can quickly add benefit to big, lower-grade, bulk-tonnage resources such as that at Llahuin.
The project has an existing JORC-compliant resource of 169 million tonnes at 0.4 per cent copper equivalent grade, which was independently certified in 2013. Resource upgrade drilling is planned for next year with an eye to increasing high-grade zones.
However, based on current calculations, the project already boasts some 686,000 tonnes of contained copper equivalent material.
Recent multi-element analytical results from Southern Hemisphere’s biggest prospect – the Southern Porphyry system – revealed the characteristic signature of a high-sulphidation epithermal environment, from which the possibility of an underlying deep target can be inferred. The company has aptly named the mammoth, deep porphyry target, Curiosity.
Management says its new Curiosity target sits 550m below the existing Santa Maria gold workings at Southern Porphyry and is about 1km in diameter, with a depth of 2km where the diameter of the target increases to 2km. It has proposed a 5000m drilling program, expected for this quarter, to conduct high-grade resource expansion at its Cerro-Ferro deposits and deep drill-testing at Curiosity.
No drilling or modern exploration has occurred previously at the Curiosity target, representing a potentially big copper-gold deposit should the drill bit pull up mineralisation.
Southern Hemisphere’s move to bulk-up its Llahuin resource comes at a time when major miners around the globe are shoring-up future copper production and acquiring globally-significant resources for the red metal. Just last month, the world’s biggest miner BHP and Lundin Mining inked a deal to acquire the Felo del Sol copper project in Chile for a massive $4.5 billion.
Investment banker Goldman Sachs is also bullish on copper, expecting the commodity to experience an increase in supply gaps into next year. In the second half of this year, it expects that supply gap to widen to 450,000 tonnes and trigger a price rise to $15,216 a tonne.
Southern Hemisphere also has an interesting manganese play, with its Los Pumas project to the north of Llahuin that contains 30.26 million tonnes grading 6.24 per cent. It is another important commodity for the electrification revolution, with the recent emergence of preferred lithium-manganese-iron-phosphate batteries for future electric vehicles (EVs).
The company has some high-impact, deep drilling on the near horizon. Should it manage to incorporate economic levels of moly with its big-tonnage copper resources, it will be able to tap into a significant byproduct addition to boost its chances of becoming Chile’s next copper takeover target.
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