Demetallica (ASX:DRM) revealed the first assay results from its maiden drill run at the company’s ‘Peake and Denison’ copper project in South Australia on Wednesday.
Oz Minerals (ASX:OZL) is a partner at the P&D play with Oz funding the maiden drill run. The project is not Demetallica’s flagship asset.
Oz retains an optional right to earn 51% majority interest in the project, that 51% earn-in requires Oz to spend $4m over three years at the project.
Demetallica, which was recently acquired by AIC Mines (ASX:A1M), also leaves the door open for Oz to earn an additional 19% interest on top of that by spending a further $6m by 2029.
AIC’s acquisition of Demetallica came in an unusually short time frame for the company, which only listed on the ASX last year.
Original bids by AIC were originally rejected before a beefed up offer was embraced with open arms in the Demetallica boardroom.
At this time, AIC now wholly owns Demetallica.
First-stage assays failed to return results in concentrations above 1%, the high-grade classification adopted by investor information provider Undervalued Equity.
However, copper mineralisation was detected in numerous drillholes, indicating the potential for broad mineralisation on-site.
Management described the results as “encouraging”, and it’s still only early days at the P&D acreage. Only three of eight priority targets were drilled in the maiden campaign.
Should today’s results seem lacklustre, it’s worth considering that Oz Minerals has six years to boost its stake to 70%. One surprise high-grade intersection could be all it takes to change the story.
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