THE BOURSE WHISPERER: Cassini Resources (ASX: CZI) announced that its Joint Venture partner in the West Musgrave Project (WMP), OZ Minerals (ASX: OZL) has satisfied its 70 per cent earn-in requirements.
Cassini Resources explained that under the Earn-in/Joint Venture agreement, OZ Minerals has satisfied the 70 per cent (Stage 2) earn-in milestone by contributing a total of $36 million towards the Nebo-Babel Pre-Feasibility Study (PFS) and regional exploration.
OZ Minerals’ affection for the project is demonstrated by it achieving the earn-in milestone 14 months earlier than required under the agreement.
“OZ Minerals has now notified, and Cassini are satisfied, that this expenditure commitment has been met,” Cassini Resources said.
The PFS for Nebo-Babel remains on track and is scheduled for completion by OZ Minerals late Q2/early Q3 2019, after which OZ Minerals will continue to sole fund the Nebo-Babel Studies until a Definitive Feasibility Study and decision to mine is delivered.
In respect of any amount funded by OZ Minerals in excess of $36 million, Cassini will be loan-carried for its 30 per cent contribution, with principal and capitalised interest to be repaid five years after the commencement of production at the WMP.
On the back of the Cassini announcement, OZ Minerals relayed that following the 2018 infill drilling program undertaken to increase Resource confidence it was able to release an updated Mineral Resource estimate for the Nebo-Babel deposits at the WMP.
OZ Minerals said that the JV’s confidence in the Resource has increased through conversion from the lower, inferred category to the higher, indicated category.
Inferred Resource conversion has resulted in a 26 per cent increase in Indicated Resources to 141 million tonnes.
Indicated Resources now comprise 59 per cent of the total Nebo-Babel Resource.
The 2018 drilling increased the amount of Indicated Mineral Resources at Babel from 73.9 million tonnes in 2017 to 108 million tonnes in 2019.
Indicated Resources at Nebo have remained relatively unchanged from 2017 to 2019, however strategic drilling, including two areas of close spaced drilling, have increased geological understanding of the deposit.
Drilling is continuing at both Nebo and Babel, including resource infill and resource extension.
Drilling of other targets in the area including Succoth and One Tree Hill are part of a separate exploration drilling program being conducted and managed by Cassini under the JV arrangements.
“This is another positive step towards realising the considerable potential of the Musgrave Province,” OZ Minerals chief commercial officer Mark Irwin said.
“Infill and extension drilling is continuing for the Nebo-Babel deposits and the uplift in resource confidence resulting from the 2018 drilling program will feed into our ongoing mine design optimisation.
“Our confidence in the project continues to build and we remain focused on our goal of maximising project value.”