Freehill Mining (ASX: FHS) is poised to begin drilling for copper and gold at its recently acquired El Dorado project in Chile once requisite approvals have been received.
The high-grade magnetite explorer acquired El Dorado last year with previous sampling and geophysical work during the December 2020 quarter generating several “high potential” targets.
Surface mapping and sampling at El Dorado returned up to 2.5% copper and 6.86 grams per tonne gold.
Meanwhile, results from an induced polarisation survey pinpointed a “huge” potential copper structure.
The structure is believed to be 10-times larger than the one found at Freehill’s adjacent flagship Yerbas Buenas project.
A high intensity core within the IP anomaly extends 1km by 500m.
At the Yerbas Buenas copper anomaly, a single exploratory diamond hole was drilled. The hole contained several intersections of “highly encouraging” copper sulphide mineralisation with a peak grade of 0.324% copper.
In readiness for the El Dorado drilling program, Freehill has secured a rig and plans to begin constructing an access road to the initial drill targets next month.
Once approvals have been received, Freehill will undertake up to three 400m diamond test holes into the primary IP target.
If results are encouraging, further drilling will be carried out to define the extent of the structure.
Advancing Yerbas Buenas
Over at the adjacent Yerbas Buenas magnetite project, Freehill continued its technical studies during the December quarter.
The studies are evaluating optimal mineral separation, product quality and mine design and will underpin a scoping study.
At Yerbas Buenas, Freehill is initially focused on developing the high-grade YB6 deposit which hosts a resource of 49 million tonnes at 20.6% iron.
Using a dry process, the ore can be readily concentrated to a minimum 62% iron with grades exceeding 70% iron also achieved with Davis Tube Separation.
Yerbas Buenas has the advantage of proximity to requisite infrastructure and an existing history of supplying ore from the YB1 orebody to Chile’s largest iron ore producer’s nearby pellet plant.
Plans for YB6 in 2021 comprise infill and extensional drilling programs with a pre-feasibility study scheduled for completion before the end of the year.
Other milestones anticipated to be achieved include submitting a mining licence application and locking-in an offtake partner, while identifying port and export options.
Strong balance sheet to fund exploration plans
Freehill chief executive officer Peter Hinner said the company made “considerable progress” across its projects during the December quarter.
Underpinning the company’s exploration plans for 2021 is a strong balance sheet.
Freehill ended the December quarter with $2.18 million in cash and “significantly” reduced debt.
The company claims this places it in its strongest financial position since its IPO.
“Freehill now has excellent exposure to three commodities – iron ore, copper and gold – all within our expanding footprint in Chile,” Mr Hinner said.
“The outlook for iron ore, copper and gold is very favourable and we continue to invest in our projects to realise further value,” he added.