Fortescue bolsters copper-gold holding in South Australia

Drill core from VUD 15 at the Vulcan prospect. Image: Tasman Resources

Fortescue Metals Group has enlarged its foothold in South Australia by embarking on two joint venture (JV) agreements in copper and gold through its subsidiary FMG Resources.

FMG secured its farm-in and JV agreement with Tasman Resources over the Vulcan iron oxide-copper-gold-uranium (IOCGU) prospect, around 30 kilometres north of BHP’s Olympic Dam mine.

Tasman has been exploring the Olympic Province in the Stuart Shelf for a number of years, the most encouraging results of which have been obtained at the Vulcan prospect.

The JV agreement is conditional on South Australian ministerial approval, which could see Fortescue earn up to 80 per cent of interest in Vulcan.

Fortescue will gain an initial 51 per cent stake in Vulcan by sole funding $4 million on exploration expenditure within a three-year period.

Its interest could then increase to 80 per cent by sole funding a further $7 million within a further five-year period.

Fortescue has also expanded its reach in the Olympic Province by executing a farm-in and JV agreement with Strategic Energy Resources over the Myall Creek copper-gold project, around 300 kilometres south of Vulcan.

The mining major will manage exploration, satisfy all expenditure requirements and keep the tenements in good standing.

“Strategic Energy Resources welcomes Fortescue joining the Myall Creek copper-gold project, bringing its substantial exploration and technical capability having discovered and developed some of the most significant mines in the world,” company chairman Stuart Rechner said.

Fortescue will first spend $1.5 million on exploration over five years to earn an 80 per cent interest in the project, after which each JV partner will contribute pro-rata to further exploration and development.

The Olympic Province is also home to OZ Minerals’ Prominent Hill and Carrapateena copper-gold projects.

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