Castillo Copper Ltd (ASX:CCZ) (LON:CCZ) (FRA:7OR) is considering divestment opportunities, including a possible spin-off of its sizeable Broken Hill Alliance (BHA) Project into a new vehicle, which could be listed in either London or Australia to capitalise on the prevailing base and precious metal upcycle.
A divestment would enable the board to channel more resources into developing the core Mt Oxide Project in Queensland’s Mt Isa copper-belt.
The board is liaising with its UK corporate advisor, SI Capital, on the optimal way to move this proposed corporate action forward in a timely manner.
Under-explored but highly prospective
Castillo Copper managing director Simon Paull said: “The resurgence of interest in the Broken Hill region is timely, as it provides an excellent opportunity for CCZ to optimise the BHA Project and create value for shareholders.
Moreover, the ground is under-explored yet highly prospective for BHT and IOCG mineralisation, with multiple drill-test targets already identified.”
An excellent asset
Castillo Copper’s London-based director Ged Hall added: “The BHA Project is an excellent asset, as it comprises a substantial prospective footprint surrounding the world-famous Broken Hill silver-zinc-lead mine.
"We believe our intent to spin this asset out into a new vehicle will be well received and supported by UK investors.”
BHA Project comprises a sizeable, under-explored footprint that is proximal to the world-class Broken Hill silver-zinc-lead deposit.
The current base and precious metal upcycle has driven a resurgence of interest in the region, notably Cobalt Blue Holdings Ltd (ASX:COB) (OTCMKTS:CBBHF) (FRA:COH), which has ground to the south of the West Zone.
Advanced predictive geological models developed by the Geological Survey of NSW (GSNSW) highlight the BHA Project is prospective for Broken Hill Type silver-zinc-lead mineralisation (BHT) in the West Zone and iron oxide-copper-gold (IOCG) in the East Zone.
The model has identified a plethora of test-drill targets, which provides a strong pipeline of exploratory work moving forward and significant upside potential.
Much of the tenure has been under-explored over the past two decades, which underscores the upside potential from rolling out a comprehensive exploration campaign
The company will formalise a workable plan with SI Capital on structuring an optimal, value-creating corporate action.