Roseby Copper Project

The Roseby Copper Project ("Roseby" or the "Project") is owned 100% by Altona Mining (50% direct and 50% through its wholly owned subsidiary, Roseby Copper Pty Ltd (RCPL)).  Total landholdings, including EPM's, ML's, MDL's and ML Applications, encompass an area of approximately 1,350 km2.

Access to Roseby from Cloncurry or Mt Isa is via the sealed Barkly Highway and the Burke Development Road to appoint 11km north from the Quamby Roadhouse and thence by graded gravel road to various sites within the Roseby tenements.

The Roseby Copper Project encompasses a total tenement area of over 1,350 sq km within the highly prospective Eastern Fold Belt of the Mt Isa Inlier. Commodities of particular interest to Universal include copper, gold and uranium.  However, there is also potential for the discovery of deposits of molybdenum, cobalt, rhenium, lead, zinc and silver.

Location and Infrastructure

The Roseby Project is located in north-west Queensland, Australia, some 65 km NW from the town of Cloncurry and 90 km NNE from the city of Mt Isa.

Access is via the sealed Burke Development Road from Cloncurry to Kurumba, on the Gulf of Carpentaria, to a turn off 66km from Cloncurry and thence 10km by unsealed road to the proposed plant site.

Cloncurry is 783kms by the sealed Flinders Highway from the port of Townsville on the east coast and 120kms by the sealed Barkly Highway westwards to the city of Mt Isa.  There is a rail connection from Townsville to Mt Isa via Cloncurry.

A major water pipeline from Lake Julius to the Ernest Henry Mine (owned by Xstrata Copper) passes adjacent to the proposed Roseby plant-site, where an off-take point has been established.

Local area grid power is generated at Mt Isa (Mica Creek Power Station owned and operated by CS Energy) and is connected to the Chumvale sub-station near Cloncurry, approximately 70km from Roseby.  A new 220kv power line will be constructed by the Company to connect Roseby to the grid.  This line will most likely be shared with Minerals and Metals Group, owners of the Dugald River zinc-lead-silver deposit, located about 10km south of the proposed Roseby plant site.

Excellent mining support services are available in Mt Isa, Townsville, and other NW Queensland regional population centres.  Cloncurry, Mt Isa and Townsville all have strong social, educational, medical and general mining services available and are home to over 5000 mine workers.

Alliance with Xstrata Copper

Mount Isa Mines Limited (Xstrata Copper) has the right, pursuant to the Heads of Agreement – Roseby Project (entered into on 11 March 2005), to acquire a 51% interest in the Roseby Project through the RFP Option and/or the SEEP Joint Venture.  Xstrata Copper also has certain rights to copper concentrate off-take and/or concentrate marketing.  Key features of the Xstrata alliance are described below.

RFP Option

Xstrata was granted an option to acquire a 51% interest in the RFP Sale Interest (the RFP Option).  The RFP Sale interest is all of the Roseby Copper Project not included in the SEEP Area (see below).

The option may be exercised any time up to 30 June 2012.

The exercise price, payable in cash, is to be negotiated at the time of exercise and if agreement cannot be reached, the price will be determined by an independent expert acting in accordance with the VALMIN Code of the AusIMM.

The valuation of the RFP sale Interest will include:

  • Value of the tenements (currently in excess of 1,350km2 in area) and the information relating thereto.  If, at the time the option is exercised, the SEEP Joint Venture remains in operation and the earning obligations have not been met, the SEEP Area will be excluded from the RFP Sale Interest.
  • The value of most of the Roseby Resources (some of the deeper sulphide mineralisation at Little Eva and Lady Clayre and all primary sulphides below the native copper deposits are included in the SEEP Area) and all of the current Reserves.
  • Subject to certain conditions. The value of any infrastructure (mine plant and equipment etc) established on the tenements.

SEEP Joint Venture

On 6 June 2007 Xstrata exercised its option to earn a 51% interest in the SEEP Area (the SEEP Sale Interest), comprising an area of around 174km2, by sole funding, by 30 June 2012, either:

  • $15 million on exploration activities; or
  • $10 million on exploration activities and completion of a feasibility study to a standard suitable for submission to banks for the provision of finance for the Roseby development.

Altona Mining believes it is unlikely that Xstrata can meet the second alternative and therefore believe it most likely that Xstrata must spend $15 million by 30 June 2012 to earn its equity in the SEEP Area.  Xstrata have spent an estimated $7.5 million to December 2009.  Xstrata may withdraw from the JV at any time up to 30 June 2012.

The SEEP area surrounds but excludes Universal's resources and reserves to either, in the case of the sulphide orebodies, a fixed depth of likely open-pit mining or, in the native copper deposits, the boundary at depth between the native copper and primary copper sulphide mineralisation.

The objective of the SEEP JV is to find, delineate and exploit anticipated large copper orebodies, expected to be located within the SEEP Area.  Of particular interest are:

  • The major primary sulphide system(s) located at depth beneath the near surface native copper deposits, such as below the Blackard and Scanlan deposits; and
  • New deposits of either native copper, primary sulphide copper or sulphide copper-gold deposits.

If Xstrata earns its 51% interest in the SEEP Area then it must buy, for cash, a 51% interest in the RFP, including:

  • The Resources and Reserves excluded from the SEEP Area;
  • Subject to certain conditions, any infrastructure erected on the tenements; and
  • The Roseby tenements, and information, not included in the SEEP Area.

The purchase price, payable in cash, is to be negotiated at the time of purchase and if agreement cannot be reached, the price will be determined by an independent expert acting in accordance with the VALMIN Code of the AusIMM.

Concentrate offtake

Xstrata has the right, but not the obligation, to acquire concentrates produced from the Roseby tenements for use at its smelter located in Mt Isa.  If not required for the Mt Isa smelter, the Roseby concentrates will be marketed by Xstrata, acting as agent for Altona Mining on normal commercial terms.  Terms of the Mt Isa Smelter offtake include:

  • World parity pricing terms;
  • Altona and Xstrata to share the freight benefits of transporting the concentrates to Mt Isa rather than a port in Japan.

Note.  An off-take agreement with Golden Sand International that formed part of an Off-take Option Agreement, has expired.

Security arrangements

The Xstrata agreement does not allow Altona Mining to encumber the tenements without the consent of Xstrata.


Roseby Copper Corridor: Potential to Double the Resource Base

Copper mineralisation at Roseby is concentrated within, but not confined to, a 2-4km wide, 25km long belt of Middle Proterozoic rocks of the Corella Formation.  This belt has been informally referred to as the Roseby Copper Corridor (RCC).  The RCC is bounded to the east by the 320km long Mt Rose Bee-Pilgrim Fault systems and to the west by the 100km long Coolullah Fault system, both of which are major, deep-seated, crustal-scale structures.

Within the RCC, and elsewhere at Roseby, copper mineralisation occurs in two distinct but inter-related styles of mineralisation:  sediment-hosted stratabound copper deposits, often with a hydrothermal overprint; and hydrothermal copper-gold deposits of the iron oxide copper gold (IOCG) style.

Please refer to the Exploration Potential page of this website for more details.

Stratabound Sedimentary Copper Deposits (Native Copper)

Seven Mineral Resources and numerous poorly tested or untested copper deposits and showings are known within the RCC.  Defined Resources (all categories) total 92.70 million tonnes @ 0.64% copper and 0.01gpt gold (refer to the Mineral Reserves and Resources page of this website for details).

These deposits generally outcrop or are covered by relatively shallow alluvium/eluvium.  They are vertically zoned on the basis of the dominant copper minerals.  An oxidised zone extends from surface to around 30m depth and consists predominantly of cupriferous goethite with minor malachite, cuprite and chrysocolla.  The oxide zone passes downwards into a supergene zone, up to 220m thick, consisting predominantly of native copper with minor chalcocite and traces of cuprite, chrysocolla and chalcopyrite.  The supergene zone overlies primary sulphide mineralisation consisting of bornite, chalcopyrite and chalcocite with trace pyrite.

To-date, the majority of drilling has been confined to the supergene (native copper) zones, particularly at Blackard and Scanlan, the two largest resources.  Very little drilling has been directed to testing the primary sulphide zones, although these are the principal target of the SEEP Joint Venture exploration effort.

Native copper ores constitute approximately 72% of the total resource base at Roseby, with Blackard the largest deposit at 46.25Mt (0.3% copper cut-off grade).

Based on extensive testing, overall metallurgical recovery of copper in the supergene zone is around 62-64%.  This represents recoveries of around 90% of the native copper and chalcocite in the ore.  The remaining copper (+/-37%) is largely refractory in altered biotite mica: either as ultra-fine native copper along mica cleavage surfaces or as copper in the altered biotite crystal lattice.

Metallurgical recovery in the primary sulphide zone, based on limited testing, is in excess of 90% of total copper.  Copper recovery in the oxide zone is low: generally less than 30% and is therefore uneconomic to mine.

There is potential to double the existing sedimentary copper resource base from a combination of:

  • Strike extensions to known deposits.
  • Development of further sulphide resources beneath the current native copper Resources.
  • Development of Resources through infill and extension drilling at the numerous identified copper deposits that have had little drilling to date.
  • Discovery of new deposits based primarily on testing of geochemical anomalies.

Iron Oxide Copper-Gold Deposits (Sulphide)

Three drilled-out deposits (Little Eva, Bedford and Lady Clayre) and several prospects of the IOCG type occur within, or in close proximity to, the RCC.  Mineral Resources within the three deposits total 35.84 million tonnes @ 0.80% copper and 0.18gpt gold (refer to the Mineral Reserves and Resources page of this website for details).

Typically, these deposits outcrop, have numerous old shallow copper workings on them, have strong geochemical anomalies (>200ppm copper and often >1000ppm) and (except in the case of Lady Clayre) strong magnetic anomalies due to the relatively high magnetite content in or near the ores.  They have been deposited in a variety of host rocks, including volcanic porphyry and carbonate-rich meta-sediments.

Characteristically, the IOCG deposits have a shallow oxidation zone of less than 25m depth, with the main oxide copper minerals being malachite and cupriferous goethite and hematite, with trace azurite and various other species. The oxide zone passes directly into the primary sulphides with a very narrow transition zone.  The primary sulphides consist of predominant chalcopyrite with trace to minor pyrite and pyrrhotite.  Minor, but economically significant, gold is present as free milling particles.

Metallurgical recoveries are excellent in these IOCG deposits, with rougher concentrate recoveries of copper often in the 98-99% range. Despite the low grades of gold, recoveries are in the 85-90% range.

IOCG deposits constitute approximately 28% of the total Roseby resource base, with Little Eva at 30.37Mt (0.3% copper cut-off) the largest deposit.

There is considerable potential to discover large to very large deposits through on-going exploration, including:

  • Extensions to Little Eva to both the north and south east.
  • Depth extensions beyond the current shallow drilling, which is generally less than 250m deep and only rarely over 350m deep.
  • Discovery of new deposits associated with extensive surface indications of IOCG mineralisation, particularly associated with the Mt Rose Bee Fault and the Lady Clayre basinal structure.  In particular, the Wonga and Quamby prospects are of considerable interest.

Mineral Resources

The following table summarises the JORC compliant Mineral Resources estimated for 10 of the mineral deposits at Roseby.  Details are provided in the Mineral Reserves and Resources page of this website.

All Resources have been estimated by McDonald Speijers (resource consultants) at a lower cur-off grade of 0.3% copper.

Proved and Probable Ore Reserves

The following table summarises the JORC compliant Ore Reserves estimated for three (3) only of the 10 deposits for which Mineral Resources have been estimated.  The other seven resources are expected to generate additional Reserves once infill and extensional drilling is undertaken.

Ore Reserves were estimated by Arbitrage Consulting, based on the optimised pit shells developed by McDonald Speijers.