BHP Reports New Early Stage Copper Find Near Olympic Dam

Through a copper exploration program, BHP (ASX:BHP,NYSE:BHP,LSE:BLT) has discovered a potential new iron oxide-copper-gold (IOCG) mineralized system 65 kilometers southeast of its Olympic Dam operation in South Australia.

According to the company’s Tuesday (November 27) release, four diamond drill holes covering 5,346 meters intersected copper, gold, uranium and silver mineralization in IOCG style.

Assay results show downhole mineralization intercepts that range between 0.5 and 6 percent copper with associated gold, uranium and silver.

BHP explains that its exploration efforts are at an early stage, and that there isn’t enough information currently to assess the size, quality and continuity of the mineralized intersections.

Nevertheless, the news has ignited excitement among companies working near BHP’s discovery. Cohiba Minerals (ASX:CHK), which owns the Minerals Horse Well exploration license adjacent to the find, saw its share price double after the announcement, and has said it will speed up exploration in the area.

Other smaller stocks whose share prices benefited from the announcement include Argonaut Resources (ASX:ARE) and Aeris Resources (ASX:AIS), which together hold the Torrens copper project.

Going forward, BHP will evaluate and interpret the reported results, and is planning an additional drill program docketed to start in early 2019.

The company has been targeting South Australia’s Stuart Shelf as part of what it calls a “focused global program” that also includes Ecuador, Canada, Peru, Chile and the Southwestern US.

As part of its efforts to replenish its resource base through copper and oil assets, the company also recently increased its stake in SolGold (TSX:SOLG,LSE:SOLG) in October from 6.1 percent to 11.2 percent.

SolGold, the majority owner and operator of the Cascabel porphyry copper-gold project in Ecuador, issued 100 million shares to BHP through the subscription agreement.

The move came just a month after BHP gained its first interest in SolGold through acquiring Guyana Goldfields’ (TSX:GUY) 6.1-percent stake in the company for US$35 million.

It’s worth noting that fellow major miner Rio Tinto (ASX:RIO,LSE:RIO,NYSE:RIO) may have made a copper discovery in Western Australia. The company has not confirmed the news, but did recently increase its exploration licenses in the area.

BHP’s share price closed at AU$30.87 on the ASX on Tuesday after the announcement, up 1.39 percent. The company’s share price took a small hit on Wednesday (November 28) when it closed at AU$30.61, down 0.84 percent.

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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.