Junior explorer Resource Base (ASX: RBX) will take control of five exploration licence applications within the Murray Basin in Victoria and South Australia when it completes the acquisition of privately-owned WA company Mitre Hill Pty Ltd.
The applications are for deposits of ionic clay-hosted rare earth elements (REE), collectively known as the Mitre Hill project and spread over a strike length of at least 40 kilometres of Murray Basin sediments.
In total, they cover 1,380 square kilometres either side of the Red Tail and Yellow Tail discoveries owned by Australian Rare Earths (ASX: AR3) which have an inferred mineral resource of 39.9 million tonnes at 725 parts per million total rare earth oxide.
Resource Base has planned a low-cost exploration and drilling program to investigate areas within the new licences which could be prospective for shallow clay-hosted rare earth mineralisation.
Executive chairman Shannon Green said the Mitre Hill project acquisition would complement the company’s existing Black Range copper-gold project, located approximately 150 kilometres away in the Stavely Arc region of western Victoria.
“Establishing a substantial footprint in this highly prospective region is a tremendous addition to Black Range … we are focused on expanding our portfolio and will look to provide an extensive pipeline of exploration and growth opportunities for these two projects which we hope will provide a solid stream of [good] news over the coming 12 months,” he said.
“We consider rare earths and copper to have strong demand fundamentals well into the future, providing a solid foundation for [us] to grow into a significantly larger diversified minerals company.”
Murray Basin location
The applications comprising the Mitre Hill project are located in the Murray Basin on the South Australian and Victorian state border near the towns of Naracoorte, Penola and Edenhope.
Resource Base is targeting ionic clay hosted rare earth deposits with possible economic concentrations of heavy rare earths which are considered strategically important given global supply modelling.
The company has acquired a significant archive of historical exploration data including drill results, government studies and results from minor private exploration.
Resource Base’s schedule of work at the licences will include field mapping to confirm prospective geological horizons to assist in exploration targeting; extensive surface sampling and testing; systematic auger, push tube and aircore drilling to test for a broad-scale, relatively-shallow deposit; and surface excavations of costeans for sampling and bulk metallurgical and mineralogical testwork.
Under the terms of the Mitre Hill acquisition, Resource Base is required to raise a minimum of $1.2 million to fund costs associated with the deal including exploration and working capital.
The company has received firm commitments for the funds through a placement of 6 million shares at an issue price of $0.20 each, together with one free attaching option exercisable at $0.25 within three years of issue.
The issuing of options is subject to shareholder approval.