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Anax Metals Limited (ASX: ANX, Anax, or the Company) is pleased to provide an update on drilling at the Evelyn deposit (Evelyn), part of the Whim Creek Project, located 115km southwest of Port Hedland.
- Diamond drilling at Evelyn deposit within the Whim Creek Project has encountered strong chalcopyrite (Cu) and sphalerite-rich (Zn) mineralisation
- Disseminated, stringer and massive sulphides intersected over a 13.5m thick zone
- Continuous XRF scanning of core to commence shortly, followed by laboratory assays
- Ongoing drilling is targeting down-plunge extensions of the high-grade shoot
Anax’s Managing Director, Geoff Laing commented: “We have redoubled our efforts to deliver leveraged growth outcomes at Whim Creek. A high-grade copper and zinc resource has already been delineated at Evelyn and highly prospective proximal exploration targets are key targets for growth. It is pleasing to again see the familiar massive mineralisation that this deposit delivers. We look forward to providing ongoing updates on the near mine exploration along with our regional consolidation strategy.”
Figure 1: Massive sulphide mineralisation in 24AED002A
Cautionary Statement:
Certain information in this announcement may contain references to visual results. The Company draws attention to the inherent uncertainty in reporting visual results. Visual estimates of mineral abundance should never be considered a proxy or substitute for laboratory analyses where concentrations or grades are the factor of principal economic interest. Visual estimates also potentially provide no information regarding impurities or deleterious physical properties relevant to valuations.
The Company recently announced1 that it was commencing a drilling programme at Evelyn of up to 1,700m. Processing of the first two holes have been completed and both have intersected zones of disseminated, stringer and massive sulphides consisting of chalcopyrite (Cu), sphalerite (Zn), galena (Pb), pyrite and pyrrhotite, up to 13.5m thick (true width estimated at approximately 80% of downhole interval).
The best visual intersection from the drilling programme to date is from Hole 24AED002A which encountered a strongly mineralised zone between 176.45 and 189.9m (Figure 1 and Figure 2).
Figure 2: 24AED002A showing mineralisation between 183.3m and 190.8m
Cautionary Statement:
Certain information in this announcement may contain references to visual results. The Company draws attention to the inherent uncertainty in reporting visual results. Visual estimates of mineral abundance should never be considered a proxy or substitute for laboratory analyses where concentrations or grades are the factor of principal economic interest. Visual estimates also potentially provide no information regarding impurities or deleterious physical properties relevant to valuations.
Click here for the full ASX Release
This article includes content from Anax Metals Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
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Anax Metals Limited
Investor Insight
Anax Metals is an ASX-listed exploration company looking to develop its copper assets in the Pilbara Region of Australia. It has important joint ventures and partnerships that can facilitate the execution of a strategic processing hub to offer a compelling investor value proposition.
Overview
Anax Metals (ASX:ANX) is a project developer that is on track to begin producing copper and zinc concentrates from its flagship Whim Creek project located in the Pilbara region of Western Australia. The project is 80 percent owned by Anax, with JV partner Develop Global (Develop) owning the remaining 20 percent. The Whim Creek DFS (and leaching study) have demonstrated the opportunity for an eight-year mining operation producing copper concentrates, cathodes and valuable byproducts. The operation will generate $410 million in cash flow and deliver an NPV of $270 million with a development capex of $71 million.
The company believes its growth potential lies both in expanding the mineral resources across the project’s four deposits and a consolidation strategy that includes a processing hub with a concentrator and heap leach at Whim Creek. Benefits from the consolidation include delivering economies of scale with processing flexibility to treat ores from regional orebodies. The permitted infrastructure is ideally located and suited to becoming the Pilbara-processing hub.,
Anax Metals and Develop have commenced a scoping study to evaluate the potential for treating high-grade oxide/transitional ores from Develop’s wholly owned Sulphur Springs project on the Whim Creek heap.
During the second quarter of 2024, Anax Metals and GreenTech Metals announced they had signed a non-binding and non-exclusive memorandum of understanding to assess the potential to treat mined material from GreenTech’s base metal assets, with a focus on the open-pittable Whundo deposit.
Anax Metals also signed a non-binding and non-exclusive memorandum of understanding (MoU) with Artemis Resources (ASX:ARV) to jointly assess the potential for processing the copper content of Artemis’ open-pittable Greater Carlow resource at the fully-permitted Whim Creek Processing hub. Anax and Artemis also agree to evaluate the potential for Artemis to explore for gold mineralisation on the Anax project tenure.
Whim Creek Pit
Since acquiring the project in 2020, Anax Metals has increased its contained metal resource inventory by over 57 percent. At the end of the second quarter of 2024, Anax Metals signed a contract with drilling company Topdrill for up to 1,700 metres of diamond drilling. Diamond drill rigs have been mobilized at site with the primary goal of testing the down-plunge extensions of the high-grade copper zones at the Evelyn deposit. Previous drilling intersected 13 m @ 4.46 percent copper, 3.10 percent zinc, 45 g/t silver and 1.61 g/t gold from 204 m. Evelyn remains open down plunge with lots of expansion potential.
Company Highlights
- Focus remains on delivering near-term copper production, within the next 18 to 24 months, at the Whim Creek copper-zinc project, which will generate in excess of $400 million in free cash flow over an eight-year mine life.
- The company’s growth strategy includes delivering both resource growth and consolidation of copper assets in the Pilbara region through the development of a central processing hub.
- Since completing the DFS last year, Anax Metals has been considering the potential to expand the production capacity of Whim Creek infrastructure beyond 20 kt of copper equivalent per year.
- Capital requirements are anticipated to be low as Anax Metals plans to utilise substantial existing infrastructure and implement preconcentration technology to reduce process capacity requirements.
- The company is currently working with key partners, including Develop Global (ASX:DVP), Greentech Metals (ASX:GRE), and several metal trading groups.
Whim Creek Copper Zinc Project
Whim Creek is located 120 km from both Port Headland and Karratha on the NW Coastal Highway in the Pilbara region of Western Australia. The project has a long history of copper production with existing infrastructure that includes dams, haul roads, offices, workshops and a dedicated gas spur line to site. The project is currently being developed as a joint venture (80/20) between Anax Metals and Develop Global. The project has four main deposits, namely Whim Creek, Mons Cupri, Salt Creek and Evelyn, with structurally controlled, volcanic-hosted massive sulphide style copper-zinc-lead mineralization.
Production – Concentrator and Heap Leach
Since completing the definitive feasibility study in 2023, Anax has promoted Whim Creek as a regional processing hub, with potential for an expanded production capacity in excess of 20 kt copper equivalent. Highlights of the technical report include FCF generation of $410 million over an eight-year mine life. Processing would be predominantly through the planned concentrator. Heap leaching is anticipated to begin in the second year of production.
A processing hub with sorting, concentrator and heap leach facilities
The company believes the project will also provide a processing solution for surrounding projects located within trucking distance of Anax’s processing facility. Longer term, Anax plans to establish a Pilbara Base Metal Alliance to facilitate collaboration with other base metal projects in the region.
Exploration
The project exploration tenure is located in the highly prospective Archean granite-greenstones of the Pilbara region, encompassing the width of the Whim Creek Greenstone Belt. Near mine extensions to known copper-zinc-lead VMS resources remain underexplored with potential at Mons Cupri South for the discovery of a new intact Mons Cupri-sized deposit. VMS-style alteration and mineralisation have been intersected over 1km. The two satellite deposits at Salt Creek and Evelyn have excellent down plunge and strike potential for blind massive sulphide shoots and drilling is under way at Evelyn.
Management Team
Phillip Jackson - Chairman
A barrister and solicitor with significant legal and international corporate experience, Phillip Jackson specialises in commercial and contract law, mining and energy law and corporate governance. He has been a director and chairman of a number of ASX and AIM listed minerals companies.
Geoff Laing - Managing Director
Geoff Laing is a chemical engineer with 30 years in mining and project development. He has been involved in the exploration and junior mining sector for the last 15 years, taking on corporate and advisory roles. He was a key player in Exco Resources’ divestment of a substantial copper asset for $175 million to Xstrata Copper, and as managing director, he delivered the successful takeover of the company by WH Sol Pattinson.
Peter Cordin - Non-executive Director
Peter Cordin is a civil engineer with over 45 years' global experience in mining and exploration, both at operational and senior management levels. He has direct experience in the construction and management of diamond and gold operations in Australia, Fenno-Scandinavia and Indonesia.
Phil Warren - Non-executive Director
Phil Warren is a chartered accountant with over 25 years’ experience in board governance, corporate advisory and capital raising advice. Warren has spent a number of years working overseas for major international investment banks. He is currently a non-executive director of ASX listed companies, including Family Zone Cyber Safety, Narryer Metals, Killi Resource and Rent.com.au. He was a founding director of Cassini Resources, which was subsequently acquired by Oz Minerals.
Jenine Owen - Chief Financial Officer
Jenine Owen joined Anax in 2020, where she is responsible for corporate risk management, financial management and financial reporting. She is a chartered accountant with extensive finance and commercial experience, including several CFO roles in ASX listed entities. Having started her career with Deloitte (Zimbabwe) in the external assurance division, she moved to London in 1999 where she held various finance and governance roles before settling in Australia in 2008. Prior to joining Anax, Owen was CFO at Predictive Discovery (ASX:PDI).
American West Gearing up for Transformational Year at the Storm Copper Project, Canada
Positive Preliminary Economic Analysis (PEA) defines Pathway to Production:
- Initial production target. Study on a starter operation at Storm based on mining inventory of 10.3Mt @ 1.3% Cu, 3.7g/t Ag delivers 487,000t of copper concentrate at 17.1% Cu, 49g/t Ag
- 10-year production plan. Initial mine plan covers 10 years of production with scope to increase both the scale of the mining operation and the mine life with potential increases in the Storm Mineral Resource Estimate (MRE)
- Attractive financials. Robust economics (estimated based on the assumptions in the base case and assuming no leverage):
- Total revenue – Approx. US$839m
- Post-tax NPV8 – Approx. US$149m
- Post-tax IRR – Approx. 46%
- Payback of Approx. 3 years
- Low-cost operation. Very low capex and operating costs of approximately:
- Initial CAPEX - US$47.4m
- Life of mine CAPEX - US$80.3m
- C1 Cost - US$2.63/lb
- Enhanced shareholder returns with leverage. Pre-tax IRR of approximately 135% with project development using 100% debt finance. American West is in discussions with a number of parties that are considering proposals to provide off-take finance or other debt solutions for development of Storm
- Innovative processing with high ESG credentials. Simple ore-sorting and beneficiation produces a high-quality copper-silver product with zero deleterious elements, chemicals, and tailings
- Mine permitting to commence. Mine permitting will now be initiated based on the PEA with potential for a further US$3.5 million to be advanced in the near- term under the Storm royalty arrangement with Taurus Mining Royalty Fund
2025 drilling to accelerate growth of copper resources:
- Existing resource is just the beginning. Major drill program planned for 2025 to accelerate the definition of copper resources along the 110km Storm Copper belt
- 2024 discoveries ready for resource definition drilling. Potential to rapidly increase the MRE through resource definition drilling of new discoveries, including:
- The Gap – a strong EM anomaly confirmed with drilling that returned 20m @ 2.3% Cu from 28m
- Cyclone Deeps – potential continuation of the large Cyclone Deposit at depth with drill intercepts such as 10m @ 1.2% Cu from 311m
- Squall – EM anomaly with drilling confirming high-grade copper of 1.5m @ 2.36 Cu from 181.4m at end of hole
- Hailstorm – chalcocite boulders at surface that returned assays of >50% Cu within a geochemical soil anomaly over 3km2
- Regional targets highlight large endowment potential. Pipeline of large-scale exploration targets along the 110km copper belt including:
- Tornado/Blizzard – located 5km east of the Storm copper deposits the area hosts a 3.2km x 1.5km geochemical copper anomaly and two large electromagnetic (EM) plates yet to be drilled
- Tempest – 4km long zone of gossans located 40km south of the Storm MRE with assays from surface samples returning base metal grades up to 38.2% Cu and 30.8% Zn
- Geophysics to generate new targets. Large airborne Mobile Magneto-Telluric (MT) survey planned for the Storm MRE area and other areas of interest along the 110km prospective copper horizon
- Forward planning for 2025 field season. The sealift operation completed in Q4 2024 delivered bulk supplies to Storm in preparation for the 2025 field season, significantly streamlining logistics to enable a short lead time for start of drilling in 2025 and reducing 2025 costs by circa. $4m
The PEA has outlined a technically robust project and demonstrated that Storm has the potential to become a profitable, long-life mine with strong economic returns for the Company.
The PEA estimates that an open pit mining and mineral processing facility at Storm can be developed with a low initial capital cost of US$47.4m to deliver a project NPV of approximately US$149m and a post-tax IRR of approximately 46%.
Shareholder returns can be substantially enhanced by use of 100% debt to fund development, which boosts the approximate pre-tax IRR to an impressive 135%. American West is in ongoing discussions with a number of parties regarding the potential for off-take or other debt-based financing for the development of Storm.
The PEA is based on the current Storm MRE of 20.6Mt at 1.1% Cu and 3.8g/t Ag which contains 229Kt of copper and 2.2Moz of silver (using a 0.35% Cu cut-off). With less than 5% of the 110km prospective copper horizon at Storm systematically explored with drilling and numerous exploration targets already identified along the copper belt, there is strong potential to add significant copper resources to the Storm MRE. The Company is planning a major exploration program for 2025 to test a pipeline of high-quality copper targets.
American West believes the dual focus of exploration in pursuit of new discoveries while progressing feasibility studies will continue to stamp Storm as an attractive copper development opportunity.
The below key economic metrics of the PEA highlight the competitive cost profile and investment returns (all financial metrics are approximations estimated on the basis of assumptions in the PEA). A copy of the PEA is attached to this ASX Release.
Dave O’Neill, American West’s Managing Director, said:
“Our field work and development studies in 2024 have laid the groundwork for what we believe will be a transformational year for American West.
“The initial economic study is an enormous milestone for the Storm Copper Project. It is exciting to announce a low capital cost pathway to mine development with significant upside to expand the production profile and mine life as our continuing exploration identifies further copper resources.
“Storm is now well positioned to be the next copper mine in Canada, joining other very successful base metal mines in the region such as Polaris (22Mt @ 14.1% Zn, 4% Pb) which operated for 21 Years, and Nanisivik (18Mt @ 9% Zn, 0.7% Pb) which operated for 26 years. We will now initiate the permitting process and progress feasibility study work.
“American West will also continue a strong focus on resource expansion and exploration drilling to fully unlock the resource potential along the prospective 110km copper belt at Storm.
“Exploration in 2024 delivered a pipeline of new discoveries and targets that we will follow-up in 2025. There are several large-scale exploration targets that offer excellent potential for a new discovery – walk-up drill targets that are supported by strong EM plates, gravity anomalies, copper gossans at surface, or high-grade copper confirmed by reconnaissance drilling.
“There is very strong potential to quickly add tonnes to the existing mineral resource estimate. With the scoping study supporting the economic potential of a mining operation at Storm, any increase in the resource is likely to further enhance the potential economics of that mining operation.
“We look forward to updating investors on the 2025 field program as arrangements are finalised.”
Click here for the full ASX Release
This article includes content from American West Metals, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
Anax Metals Limited Investor Kit
- Corporate info
- Insights
- Growth strategies
- Upcoming projects