Monax Mining (ASX:MOX) is securing full ownership of the Punt Hill IOCG Project in South Australia after a wholly-owned subsidiary of Chilean copper producer Antofagasta plc elected not to continue to sole fund exploration.
Punt Hill is located within the highly prospective IOCG province on the eastern margin of the Gawler Craton, which hosts the world class Olympic Dam and Prominent Hill mines.
It is adjacent to the Carrapateena deposit, which consists of a complex hematite breccia extending at depth from approximately 470 metres below the surface.
In August 2010, Monax signed a Farm-In Agreement with Antofagasta (LON:ANTO) under which the copper producer earned a 51% stake in the project by expending US$4 million.
Antofagasta funded a further approximate US$700,000 before deciding not to sole fund additional exploration on the project.
Monax is earning back the interest by issuing Antofagasta 9.99% of its shares. Antofagasta will retain a 1.5% net smelter royalty (NSR) which Monax can purchase at any time prior to the commencement of production for US$4 million.
The company is eligible for up to $75,000 in funding under the South Australian Government’s PACE initiative for drilling on the Punt Hill Project and is planning to drill a further hole at the Groundhog prospect in the second half of 2015.
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