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Hammer Metals announces Joint Venture with Mount Isa Mines

Published by
Global Mining Review,

Targets Hammer Metals Limited has announced completion of the purchase of the 51% interest in EPM 14467 held by AuKing Mining Ltd (formerly Chinalco Yunnan Copper Resources Limited).

EPM 14467 is located adjacent to the Mary Kathleen Uranium Mine, 60 km east of Mount Isa and covers the Mary Kathleen Shear Zone that hosts several copper-gold, uranium and REE prospects including Jubilee, Koppany and Blue Caesar. As a pre-condition of the purchase a new Joint Venture Agreement with Mount Isa Mines Limited (MIM), which holds a 49% interest in the tenement, was negotiated.

Commercial terms

The outstanding consideration for the acquisition is the issue to AuKing of 250 000 ordinary Hammer shares. Key terms of the Joint Venture Agreement with MIM are as follows:

The Joint Venture Agreement is between Mulga Minerals Pty Ltd (Mulga) a 100%-owned subsidiary of Hammer Metals Limited, and Mount Isa Mines Limited a 100% owned subsidiary of Glencore PLC.

Each party to the Joint Venture will contribute exploration expenditure according to their participating interest (HMX – 51% / MIM – 49%).

Dilution provisions apply if a party elects not to contribute to a programme. If a party’s participating interest falls below 10% their interest will convert to a 3% Net Profits Royalty.

Mulga has agreed to act as the initial manager of the Joint Venture and will remain manager whilst its interest exceeds 50%.

MIM has the right to match the terms of any proposed sale of ore or concentrate from the tenement by Hammer to a third party. Previous Exploration Because of the tenements proximity to the Mary Kathleen Mine much of the historical exploration was focused on uranium mineralisation. In recent years the focus has been on copper, with MIM conducting comprehensive geochemical and geophysical programmes followed up with nine diamond drill holes on the Koppany prospect located 2 km along strike to the south east of Mary Kathleen. Diamond drilling (nine holes) by MIM at Koppany intercepted a mineralised skarn sequence with zones of massive and disseminated pyrrhotite and chalcopyrite. Anomalous Rare Earth Elements (REE’s) were also intersected in the drilling included cerium (up to 1.7%), lanthanum (up to 1.2%) and neodymium (0.26%). Key intercepts are summarised in Table 1. AuKing extended the Koppany copper soil anomaly to the south with extensional sampling resulting in an anomaly (>500 ppm Cu) of approximately 3.5 km long and 400 m wide. AuKing also drilled 19 RC drill holes at the Jubilee copper-gold workings.

  • 10 m at 3.37% Cu and 2.27g/t Au from 107m in Q-029.
  • 9 m at 2.8% Cu and 1.44g/t Au from 73m in Q-028.
  • 11m at 1.76% Cu and 0.44g/t Au from 78m in Q-020.

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