Drilling below a blueprinted open cut development at Mt Oxide in north west Queensland is now expected to give Perilya Ltd (ASX: PEM) a greater degree of confidence for development and for adding significantly to the resource inventory.
New drill holes detailed today to the north and below the planned pit gave intersections of 22 metres grading 6.3% copper and 0.3% cobalt from 258m depth; 19m @ 3.7% Cu from 315m; 31m @ 6.2% Cu from 346m and 23m @ 8.9% Cu from 395m.
These intercept are outside of the current resource and have significant prospects at depth, commented executive chairman Patrick O'Connor.
The results are particularly encouraging for either defining a high-grade underground resource or deepening the planned open pit, he added.
That pit takes in a resource of 203,000t of contained copper. A scoping study showed that the open cut operation contained 15.5 Mt @ 1.3% Cu.
Perilya said that the optimised pit shell was based on the maximum undiscounted cash flow for the total indicated and inferred resource, and it contains about 8.6 Mt in-pit @ 1.5% Cu, 0.05% Co, and 9 grams/tonne silver - at a strip ratio of 7.7:1.
Mt Oxide is in the heartland of major base and precious metal mining projects and has the Lady Loretta and Lady Annie projects to the west, the Roseby copper and Ducald River zinc projects to the south and the big Century zinc mine to the north west.
Two diamond drill rigs have been on location for the deeper drilling.
There was an early mining life at Mt Oxide where a small open pit and underground mine operated intermittently between 1920-71.
The deposit is a chalcocite-dominated system associated with strong silica-haematite alteration. Copper mineralisation is developed on the margins of the haematite core.