Magmatic Resources and Fortescue Metals announce joint venture

Company News

by Glenn Dyer

In March, Magmatic Resources (ASX:MAG) announced a joint venture with Fortescue (ASX:FMG) for the Myall copper-gold prospect in central western NSW.

Myall is in the same area as Alkane’s Kaiser and Boda finds, which are huge, with hundreds of millions of tonnes in mineral resource estimates (MRE) for copper and gold.

The two prospects are also near existing mines at Cowal, Northparkes (both Evolution), Tomingley (Alkane), and Cadia (Newmont/Newcrest).

The region where Myall is located is predominantly a porphyry copper/gold-rich area.

Magmatic’s Myall is smaller at the moment (a couple of hundred million tonnes of MRE) but with prospects for an upgrade with extra drilling, which needs money. Fortescue will contribute $14 million over the next six years to earn a 75% stake.

The two companies have formed a committee to oversee and direct the exploration work of the Myall prospect in a two-phase program for 2024-25, with phase one expected to be completed by the end of this calendar year.

Phase 1 will see up to 75 holes drilled at the Corvette, Kingswood, and Monaro prospects at Myall. Historic core and drill chips will be re-assayed to check work previously done in the area.

Existing geophysical datasets will be reprocessed and integrated with the updated geochemical datasets, and a detailed study of the immediate Corvette/Kingswood area will be undertaken to identify potential areas of higher-grade copper-gold mineralisation.

Phase 2 will involve six diamond drill holes, each 400–500 metres deep, to test multiple prospect areas. Final targets and drill hole designs will be agreed upon following the integration of results from the Phase 1 work.

Fortescue can earn an initial 51% interest in Myall by committing $6 million to exploration over four years and an additional 24% by committing another $8 million over an additional two years.

Fortescue holds a 19.9% stake in Magmatic to protect its partner.

Late last month, Magmatic announced the start of a drilling campaign at the Lady Ilse gold-copper prospect at the company’s Wellington North Project, which is in the same area as the Myall prospects.

Magmatic said, "Lady Ilse is considered highly prospective for Boda-style mineralisation (Alkane’s nearby prospect), with previous drilling intersecting 45 metres at 0.44 grams of gold per tonne, 41 metres at 0.25 grams of gold per tonne and 0.11% copper, and 13 metres at 0.72 grams of gold per tonne and 0.36% copper."

The company says it will drill between 70 to 80 air core drill holes north of the previously identified 750-metre gold-copper trend. This campaign is expected to take up to two weeks, after which Magmatic will decide whether to move to reverse circulation or diamond drilling follow-up.

Subscribe to our Daily Newsletter?

Would you like to receive our daily news to your inbox?