Queensland copper-tunity Jo Clarke 15 September 2006
Acquisitive Swiss miner Xstrata said yesterday it had expanded its copper resource in Queensland through a joint venture, and controversial explorer Cudeco has upgraded the size of its potential project in the state.
Xstrata will spend up to $15 million for 75 per cent of Matrix Metals' McCabe deposit near Mount Isa as it sets about putting itself in the driving seat of what some believe will develop into a globally significant copper area.
Separately, Cudeco yesterday released a further update on its Las Minerale project near Cloncurry.
It reported after the market closed that it had tripled the size of the inferred mineralised zone, implying it had found a much larger system than previously thought.
If the bulls are to be believed, the company's share price should regain some momentum today, although it was still very much early days, analysts warned.
"There has been a long history of copper occurrences in the Mount Isa and Cloncurry region and I have long held the view that there is something substantial to be found up there," Intersuisse analyst Peter Arden said.
"The copper price being where it is has made a difference to how hard people are prepared to look for it."
The area is difficult geologically because of the age of the rocks and deep weathering of the deposits. Xstrata has the advantage of owning the only copper smelter in the region at Mount Isa, which it acquired when it bought Mount Isa Mines in 2003.
Xstrata Copper chief operating officer Barry Grant said: "We have a long-term commitment in North Queensland where we want to work with a number of junior explorers to secure long-term supply for our smelter."
It was also spending a lot more money than its predecessor MIM on exploration in the region and technical alliances with juniors, Mr Arden said.
Xstrata is near the end of a $100 million expansion at Mount Isa, much of which is directed at increasing the amount of copper coming out of the smelter.
It has a 51 per cent option over Universal Resources' Roseby project near Cloncurry. It was also rumoured to be in negotiations with Cudeco, although analysts believe the former Australian Mining Investments may be too highly priced for Xstrata.
Cudeco rose 14¢ to $3.91 yesterday, well short of the $10 it hit after an earlier exploration release, which it was forced to amend because it was "overstated".
MRX Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
