THE CONFERENCE CALLER: Although it was only the briefest of references in passing, Stavely Minerals’ (ASX: SVY) boss Chris Cairns made an interesting observation when – at the recent RIU Resurgence Conference in Western Australia – he suggested the mineralisation of his company’s namesake Victorian exploration project may be similar to that of one of Australia’s great historic copper operations. By Mark Fraser
No doubt investors who attended the event, which was held in the explorer’s home town of Perth in WA, took note when Cairns hinted the polymetallic Stavely play in west Victoria might resemble Mt Lyell in Tasmania.
Located 175 kilometres north west of Hobart in the prospective Mt Read volcanics, the Mt Lyell camp has hosted – at least in the words of some information provided by the Tasmanian geological survey – “some of the oldest significant mines in Australia”.
Discovered in 1883, the project area had, by 1999, been responsible for a large portion of Tasmania’s gold production as well as most of its copper – yielding 1.4 million tonnes of copper, 43 tonnes of gold and 733 tonnes of silver from 119 million tonnes of ore.
According to some news sources, when Mt Lyell was put on care and maintenance during 2014 by the publicly-listed Vedanta Resources (LSE: VED), its historic output of red metal had risen to 1.8 million tonnes.
Cairns told RIU delegates that, just after listing on the ASX via a $6 million initial public offering during 2014, Stavely raised a few eyebrows when it decided to concentrate its field efforts in western Victoria.
“At the time people said you need your head read if you go into Victoria – it’s very low in the Fraser Institute’s rankings of exploration destinations,” he noted.
“(And) it’s funny how, six years later, it is one of the hottest destinations in the world for exploration, with Fosterville and Kirkland Lake (ASX: KLA) having so much success there.
“And we’ve made a discovery in a completely different terrain. When we moved in there, there was no mining history whatsoever in western Victoria – certainly not for porphyries or copper.
“But we persisted for a number of years seeking a porphyry target and eventually discovered a magma Arizona-style of deposit, and hopefully the porphyry is sitting underneath.
“It’s almost unique in Australia in terms of the style of mineralisation – I don’t know of any other deposit (like it … but it’s been suggested that) maybe Mt Lyell may have some attributes of this style of mineralisation.”
Since then Stavely – with its 1461 square kilometres ground position – has established itself as a first mover within Victoria’s Stavely Arc, where the company is developing its wholly-owned Stavely and Ararat projects.
The majority of the junior’s exploration has focused on Thursday’s Gossan, where the initial target was a Tier-1, Cadia-style copper-gold porphyry system that included an extensive chalcocite-enriched blanket occurring 30-80m below surface.
When this was starting to resemble something of a “rabbit hole”, however, the junior began looking for lode-style mineralisation closer to surface – a move which led to the discovery of the shallow (0-200m), high grade copper-gold-silver Cayley Lode. So far Stavely has established an inferred mineral resource of 28 million tonnes at 0.4 per cent copper for 110,000 tonnes of contained red metal at Thursday’s Gossan.
Describing the Cayley Lode as a game changer, Cairns indicated it could well be the tip of a new copper province iceberg.
As it stands Stavely is now planning to complete a mineral resource drill-out of the shallow (0-200m) Cayley open pit mineralisation.
And, aside from also starting a scoping study on the first phase of the proposed above ground development, the company is also looking to re-deploy drill rigs to define the Cayley Lode at depth in order to lay the foundation for a phase two underground operation.
In addition, drill testing of further porphyry and regional targets is scheduled.
“We’ve defined it down to a kilometre and, if it’s continuous, we’re thinking about a two decade mine life at the phase two underground after the open pit,” Cairns added.
Stavely is now well positioned to complete this early due diligence, having a healthy $32 million cash in the bank.