C29 Metals Ltd (ASX:C29) has entered into an option agreement with Isa Tenements Pty Ltd, a wholly-owned subsidiary of GBM Resources (ASX:GBZ) Ltd to acquire 100% of the Mayfield Copper-Gold (IOCG) project near the Trekelano and Tick Hill mines in Queensland.
The Mayfield project complements C29 Metals’ core projects and provides the opportunity to further expand its copper-gold inventory.
The project sits within the prospective fertile Corella Formation lithology adjacent to the very large Pilgrim Fault Zone and bordering Trekelano Copper-Gold and Tick Hill Gold mines.
C29 Metals is currently undertaking due diligence on the Mayfield project and will update the market upon its completion.
Add to copper project portfolio
C29 executive director Mark Major said: “The Mayfield project presents an opportunity to strategically add to our copper project portfolio and provide a strong exploration asset in a well-established mineral camp.
“There are various prospects previously identified and sporadically explored.
“There is a lot of smoke, and we believe that with modern high-powered geophysics and systematic exploration we have a good opportunity to find substantial copper and gold mineralisation.
“We are currently undertaking project due diligence and once its complete we will advise of the outcome.”
Option agreement details
Under the agreement, C29 Metals has been granted an exclusive option to acquire up to 100% of the Mayfield Project (comprising Exploration Licence EPM19483) on the following terms:
➢ C29 has an exclusive option for 60 business days to conduct due diligence on the Mayfield project by paying an initial option fee of $20,000 (plus GST) and a second $20,000 (plus GST) when the exploration licence is granted;
➢ Subject to C29 exercising the option, the following consideration will be made to the vendor:
Cash payment of $210,000 within 15 days of exercise of the option; and
issue GBM or nominee the greater of 1.25 million C29 shares or the value of $250,000 in C29 shares, based on a seven-day volume-weighted average price (VWAP).
➢ The option is conditional on the exploration licence being renewed, successful due diligence, and other customary conditions; and
➢ The project has an inherent 2% net smelter return royalty held by a third party.
Shares will be issued under the company’s available 7.1 placement capacity.
The transaction was negotiated at arm’s length and none of the vendors are related parties.
Mayfield Project
The Project is around 150 kilometres southeast of Mount Isa within the Mary Kathleen Zone of the Eastern Succession.
The dominant Proterozoic geology consists of Argylla and Corella Formation volcanics and sediments, adjacent to the Pilgrim Fault Zone, a very large, strike-slip fault system that extends over 200 kilometres to the north.
At either end of the project sit the Trekelano mine with a resource (2006) of 3.1 million tonnes at 2.1% copper and 0.64 g/t gold, and the Tick Hill mine which produced 470,000 tonnes at 28 g/t gold.
Almost the entire Pilgrim Fault Zone is currently under lease and recent work by various companies, including Hammer Metals Ltd (Kalman project) and Carnaby Resources Ltd (ASX:CNB) with the recent discovery at Nil Desperandum and Lady Fanny, supports the potential for discovery within the Mayfield project.
The project area consists of a single large tenement and a smaller single block, with a combined area of 91 square kilometres, EPM19483 Mayfield.
The exploration license is currently in the process of being renewed for an additional three-year period.
Within the tenement, at least three mineralisation styles have been defined by previous workers: mylonite-hosted gold only (Tick Hill), ironstone hosted magnetic copper-gold (Trekelano) and zinc-lead-silver mineralisation (Delta Maiden Ck prospect).
Extensive regional soil sampling indicates that the magnetic anomalies (generally concealed) are associated with copper-gold or base metal mineralisation along much of their strike length at Mayfield.