Empire Resources (ASX:ERL) has entered into a two year option agreement to acquire an interest in two prospective copper-gold licences in central Western Australia.
The two licences join the northern boundary of Empire’s wholly-owned and advanced Yuinmery copper-gold project.
The two granted exploration licenses host the significant A Zone copper-gold prospect which lies on the northern boundary.
David Sargeant, managing director, commented: “With an imminent cash flow anticipated from gold mining at the Penny’s Find project, Empire is keen to advance new exploration targets.
“Further drilling at A Zone should allow Empire to calculate the prospect’s maiden resource which will significantly expand the total copper-gold resource base at Yuinmery, greatly improving the overall economics of this project.”
Option agreement
The two exploration licences, E57/681 and E57/1027, are the subject of a joint venture between Evolution Mining (ASX:EVN) and a wholly owned subsidiary of Atlas Iron (ASX:AGO).
Under the agreement Empire will have the option to acquire Evolution’s interest, which currently stands at circa 91% in the joint venture.
Under the option agreement, Empire must meet all expenditure commitments while retaining an option to purchase Evolution Mining’s interest for either a cash or share consideration of A$500,000.
Licence details
Previous exploration undertaken at the licenses has intersected significant copper-gold mineralisation at the A Zone prospect situated just 1.3 kilometres along strike from Empire’s Just Desserts copper-gold deposit.
Better intersections at the A Zone prospect include:
- 5 metres at 4.4% copper, 0.4 g/t gold within 19 metres at 1.9% copper, 0.3 g/t gold from 160 metres;
- 4 metres at 4.5% copper, 0.5 g/t gold within 7 metres at 3.2% copper, 0.5 g/t gold from 192 metres;
- 5 metres at 2.8% copper, 1.2 g/t gold within 10 metres at 1.8% copper, 0.9 g/t gold from 222 metres; and
- 3 metres at 4.0% copper, 3.3 g/t gold within 8 metres at 2.4% copper, 1.3 g/t gold from 275 metres.
Analysis
As Empire closes in on the commencement of gold mining at its Penny’s Find project, the Yuinmery copper-gold has the potential to become an important project for future exploration.
The company has a good opportunity to expand upon Yuinmery’s Just Desserts prospect which already hosts a 1.27 million tonnes at 1.9% copper and 0.7 g/t gold resource.
By entering the option to acquire an interest in adjoining exploration licenses with proven gold targets, the potential value of Yuinmery is increased.
During late December, Empire signed a toll treatment agreement advancing the company one step closer to mining operations at the Penny’s Find gold mine, located 50 kilometres from Kalgoorlie.
Empire shares are trading up over 130% over the past 12 months, currently priced at $0.033.
With AUD gold trading over A$1,600 per ounce, this is a fortuitous period for Empire to be approaching gold production.