rxm's hillside pfs positive for cxo

Rex (RXM) yesterday released the positive pre-feasibility study on the huge Hillside open-pit copper mine on the Yorke Peninsula. Currently Hillside is Australia’s largest undeveloped copper project.

Rex is predicted to generate $240M p.a. EBITDA (potentially $380M) from the 15+ year life of mine at low cash cost of $1.20/lb.

The proposed Hillside copper mine is located 30km away on the adjacent tenement to Core’s Yorke Peninsula (YP) project.

Core’s first diamond drill results on YP in 2012 achieved similar tenor of copper intersections to RXM’s first drilling program at Hillside in 2008. But in the market decline of post-April 2012, the market has lost sight how meaningful these results are at early stages of exploration.

This trend may be about to change.

Core’s exploration and drilling work on the YP Project this year has confirmed that copper mineralisation identified by Core’s drilling has the following similarities to copper mineralisation at Hillside – so the early indicators for Core’s exploration are very positive:
• Same host geology
• Same age structural and alteration systems
• Large-scale structural setting CXO
• Similar scale magnetic and gravity targets
• IOCG style alteration
• Vein and shear hosted mineralisation

With Hillside going ahead, Core will also have the upside of having a hungry copper processing plant to leverage its local exploration success - with potential to significantly lower time/cost hurdles of turning CXO’s exploration success into value for shareholders– this point won’t be lost on Industry players.