THE Horseshoe Lights and Kumarina copper mines have been dormant for decades. Soon they could form an integral part of Australia’s new copper renaissance. By Blake Wilshaw - RESOURCESTOCKS*
Located in the Peak Hill district of central Western Australia, Horseshoe Lights and Kumarina were leading sources of copper in their era.
Now they are controlled by one company, and in barely 18 months since listing on the Australian Securities Exchange, Horseshoe Metals has done enough groundwork to consider redevelopment in the region.
The Peak Hill district is the Australian exploration sector’s favourite stomping ground for big copper finds, thanks largely to Sandfire Resources’ DeGrussa discovery.
But it was mines such as Horseshoe Lights and to a lesser extent Kumarina which defined the region for much of the 20th century.
Located 140km north of Meekatharra and discovered in 1946, Horseshoe Lights was in production until 1994.
Historically it performed at avery high grade, with 219,000 ounces of gold from 1.6 million tonnes of ore grading an average of 4.2 grams per tonne – plus another 94,000oz of gold produced in association with copper ore.
Copper output totalled 54,800t from 1.7Mt of ore grading 3.2% copper, including super-high grade direct shipping ore known as chalcocite.
Horseshoe Lights is situated in the Narracoota volcanics, the same geological structure which hosts DeGrussa. The old open pit and near-mine exploration has been the focus for Horseshoe Metals since its IPO in 2010.
The company recently defined a measured, indicated and inferred resource of 8.6Mt at 1.06% copper and 0.13gpt gold for 91,000t of copper and 37,400oz of gold, using a 0.5% copper cut-off grade.
The estimate excludes surface stockpiles and mineralised dumps at the project.
Further north lies Kumarina, which has been the focus for Horseshoe Metals for much of the past six months.
Located 120km from Horseshoe Lights, Kumarina was discovered in 1913 and worked intermittently until 1973. It was the second largest producer in the Bangemall Basin, with recorded output to the late 1960s of 481t of copper at a high-grade of 37% and 2340t at a grade of 17.51%.
Horseshoe Metals program to uncover further riches at Kumarina started in late 2011, managing director Neil Marston explained.
“The plan for the past six months was to get a drill rig up and rolling at Kumarina because we’d been on the ground there and had seen some of the workings from the old-timers which warranted follow up,” he said.
“The remnants were small-scale work but the stockpiles of stuff that they left on the ground showed clear evidence that they were mining something of a reasonably high-grade.”
Reconnaissance work, including aero-magnetics and ground magnetics, was followed by a 51-hole program.
The first 12-hole phase of that drilling proved Horseshoe Metals was onto something at Kumarina, particularly at the Rinaldi prospect.
Results, which sent company shares soaring on announcement, included 28m at 2% copper from 56m, 17m at 2.8% copper from 35m, 14m at 2.7% copper from 22m and 27m at 1.3% copper from 65m.
The results justified heightening Kumarina’s priority status.
“We backed that up with another 25-hole program straight away,” Marston said.
“We were quietly confident that we’d have some success with the first drilling so we pretty much went straight back for a second program before Christmas.”
Just weeks ago, assays from the second phase of drilling returned further exciting results, including 13m at 3% copper from just 10m including 3m at 9.9% copper, 13m at 2.7% copper from 67m including 2m at 14.4% copper which included a peak intersection of 1m at 16.2% copper and 13m at 2.2% copper from 33m.
“We’re planning more drilling this year to test Rinaldi, which will initially include some diamond drilling to get a better understanding of the orientation of the mineralisation at depth,” Marston said.
Kumarina’s potential lay hidden from previous miners and explorers by colluvium cover.Horseshoe’s recent aero-magnetic survey has penetrated the cover to identify several high priority target areas similar to the Rinaldi prospect.
“We’re quite excited about the potential for Kumarina because where we’re finding copper generally hasn’t been thought of as the mineralisation host structure,” Marston said.
“We’re finding copper in the dolerite and high-grade zones generally within quartz veins, which is good news because we’ve got quite a few major north-south faults on our ground which have dolerite evident on them from the aero-mags.
“We’ve also hit some massive sulfides with chalcopyrite in the deeper holes, which looks very interesting.”
Horseshoe Lights hasn’t been sidelined, with Marston detailing the two-pronged approach the company will take for the rest of the 2012 financial year.
“We were always planning to do a stocktake of where we were at with Horseshoe Lights based on the drilling we did in our first year, and that’s where that resource number came from,” he said.
“We’re planning to go back to Horseshoe Lights; we’ve got some good targets there including a deep IP [induced polarity] target which we want to drill.”
The IP drilling is targeting a potential repetition of the main zone of mineralisation.
“It is in the right orientation and location structurally to be a possible repetition of the high-grade main zone which was mined in the 1990s,” Marston said.
“The IP target lies below 200m depth and if we find something there it would be an underground proposition.
“There’s no drilling gone beyond 180m in that area and the couple of holes that did go down that deep ended in interesting geology.
“If we’re successful in testing that target and finding a mineralised system, we’ll be very excited.
“So we’re progressing both projects this year and Horseshoe Lights is not that far away from the point where we would conduct a feasibility study.”
Regarding finances, Horseshoe Metals has budgeted about $A2.5 million on exploration in the coming months.
As RESOURCESTOCKS went to print, Marston was finalising a capital raising and with 23 million options at 20c maturing in June this year, Horseshoe Metals is well-funded.
“By about mid-year we will have finished our planned drilling programs at Horseshoe Lights and Kumarina,” Marston said.
“By the second half of the year, depending on the success of those results, we’re hoping to be in a position to start a Horseshoe Lights feasibility study.”
“At Kumarina we expect to be in a position to put some frames around those numbers we’ve got at Rinaldi for a maiden resource.” "
-MiningNews.net
An article i read last week about Horseshoe Metals, well written and good to see Horseshoe coming into the spotlight.
HOR Price at posting:
30.0¢ Sentiment: Buy Disclosure: Held
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