TIDMCCZ
RNS Number : 6201R
Castillo Copper Limited
30 October 2023
30 October 2023
CASTILLO COPPER LIMITED
("Castillo", or the "Company")
September 2023 Quarterly Activities Report
Castillo Copper Limited (LSE and ASX: CCZ), a base metal
explorer primarily focused on copper across Australia and Zambia,
is pleased to present shareholders its latest quarterly report for
the period 1 July 2023 to 30 September 2023.
HIGHLIGHTS:
Cangai copper mine
-- Updated JORC (2012) compliant Mineral Resource Estimate for
Cangai Copper Mine at 4.4Mt @ 2.5% Cu inferred insitu and 0.2Mt @
1.35% Cu indicated from historic stockpiles for 114kt contained
copper metal; augmented further by zinc, gold, and silver
credits(1)
INTERIM EXECUTIVE DIRECTOR APPOINTMENT
-- Post the review period, the Board appointed Mr Jack Sedgwick as interim Executive Director
-- Mr Sedgwick's mandate is to undertake an asset review of the
current portfolio, re-shape priorities then update the group's
strategic intent
ACTIVITIES REPORT
An overview of key events follows:
DEVELOPMENT WORK
Castillo has four properties comprising the NWQ Copper Project
in Mt Isa's copper-belt in Queensland, the BHA Project near Broken
Hill's world class silver-zinc-lead deposit in NSW, the historic
Cangai Copper Mine in NSW and several assets across Zambia's
copper-belt.
CANGAI COPPER MINE, NSW
On 25 July 2023, Castillo's geology team, working in conjunction
with a specialist geological consultancy, produced an updated JORC
(2012) compliant Mineral Resource Estimate (MRE) for the Cangai
Copper Mine at:
-- 4.4Mt @ 2.5% Cu inferred insitu and 0.2Mt @ 1.35% Cu
indicated from historic stockpiles for 114kt contained copper
metal; augmented further by zinc, gold, and silver credits (Table
1)(1) .
Table 1 : Cangai Copper Mine Resource Tonnages
Category Inferred Cu Co Zn Au Ag Cu Co Zn Au Ag
Mass (%) (%) (%) (g/t) (g/t) (T) (T) (T) (Kg) (Kg)
(T)
Oxide Insitu 634,000 2.65 0.01 0.65 0.15 16.1 16,801 63 4,121 95 10,207
---------- ----- ----- ----- ------- ------- -------- ----- ------- ------ -------
Fresh 3,773,000 2.48 0.01 0.55 0.31 15.2 93,570 226 20,752 1,170 57,350
---------- ----- ----- ----- ------- ------- -------- ----- ------- ------ -------
Ex-Mine
Oxide Dumps 29,000 2.10 0.02 0.3 0.58 14.5 609 5 87 17 421
---------- ----- ----- ----- ------- ------- -------- ----- ------- ------ -------
Total 4,436,000 2.5 0.01 0.6 0.29 15.3 110,980 294 24,960 1,282 67,978
---------- ----- ----- ----- ------- ------- -------- ----- ------- ------ -------
Historic Stockpiles
Category Indicated Cu Co Zn Au Ag Cu Co Zn Au Ag
Mass (%) (%) (%) (g/t) (g/t) (T) (T) (T) (Kg) (Kg)
(T)
---------- ----- ----- ----- ------- ------- -------- ----- ------- ------ -------
Smelter
Slag and
Ex-Mine Oxide
Dumps 199,000 1.35 0.02 1.9 0.1 4.6 2,687 48 3,781 20 915
---------- ----- ----- ----- ------- ------- -------- ----- ------- ------ -------
Total 199,000 1.35 0.02 1.9 0.1 4.6 2,687 48 3,781 20 915
---------- ----- ----- ----- ------- ------- -------- ----- ------- ------ -------
Total 4,635,000 2.45 0.01 0.6 0.28 14.9 113,667 342 28,741 1,301 68,893
---------- ----- ----- ----- ------- ------- -------- ----- ------- ------ -------
Notes:
1. All resource tonnages rounded to the nearest 1,000 tonnes
2. Refer to JORC Table 1 for details on data and estimation
3. Insitu tonnages calculated as a guide only, no recovery
factor, loss or dilution considered
Source: CCZ Geology Team
In calculating the updated MRE from the 2017 work (MRE: 3.3Mt @
3.35% Cu for 108,000t(4) ), the geology team factored in reverse
circulation and diamond core drilling campaigns undertaken across
2017-18 and used more conservative assumptions to boost the
confidence in the revised 2023 MRE. The geology team noted several
encouraging observations that underpins significant exploration
potential for the Cangai Copper Mine, including:
-- The underlying orebody - which commences from surface - is
not fully defined, as it remains open to the east, south-east and
down dip.
-- There are several sizeable downhole electromagnetic (DHEM)
conductors, proximal to the line of lode, that can potentially
extend known mineralisation along strike.
-- With the revised 2023 MRE enhancing the Cangai Copper Mine's
resource size, the Board is highly optimistic Castillo can realise
value for shareholders from this historical producing asset.
Exploration potential
A key positive for the Cangai Copper Mine is the copper orebody
commences from surface. More encouragingly, the full extent of the
underlying copper orebody remains undetermined, as it remains open
to the east, south-east and down dip. As shown in Figure 1 , there
are several sizeable DHEM conductors(1) , which are north and south
of the line of lode, that can potentially extend known
mineralisation along strike.
Figure 1 : DHEM conductors at Cangai Copper Mine
POST PERIOD EVENT
On 9 October 2023, the Board announced the appointment of Mr
Jack Sedgwick as interim Executive Director(2) , following the
departure of former Managing Director, Dr Dennis Jensen. Mr
Sedgwick's mandate is to undertake a thorough asset review,
re-shape priorities then update the group's strategic intent(3)
.
PAYMENTS TO, OR TO AN ASSOCIATE OF, A RELATED PARTY OF THE
ENTITY DURING QUARTER DURING THE QUARTER
$172,000 was paid to related parties of Castillo relating to
executive director salary and non-executive director fees.
Table 2 : Summary of the exploration expenditure incurred during
the quarter
Asset Consulting fees Rates and mines departments
fees
Cangai $164,000 $10,000
---------------- ----------------------------
Broken Hill Alliance $75,000 $15,000
---------------- ----------------------------
Mt Isa $28,000 $16,000
---------------- ----------------------------
Zambia $18,000 -
---------------- ----------------------------
Total $285,000 $41,000
---------------- ----------------------------
For further information, please contact:
Castillo Copper Limited +61 8 6558 0886
Gerrard Hall (UK), Chairman
SI Capital Limited (Financial Adviser and
Corporate Broker) +44 (0)1483 413500
Nick Emerson
Gracechurch Group (Financial PR) +44 (0)20 4582 3500
Harry Chathli, Alexis Gore, Henry Gamble
About Castillo Copper
Castillo Copper Limited is an Australian-based explorer
primarily focused on copper across Australia and Zambia. The group
is embarking on a strategic transformation to morph into a mid-tier
copper group underpinned by its core projects:
-- A large footprint in the Mt Isa copper-belt district,
north-west Queensland, which delivers significant exploration
upside through having several high-grade targets and a sizeable
untested anomaly within its boundaries in a copper-rich region.
-- Four high-quality prospective assets across Zambia's
copper-belt which is the second largest copper producer in
Africa.
-- A large tenure footprint proximal to Broken Hill's
world-class deposit that is prospective for
zinc-silver-lead-copper-gold and platinoids.
-- Cangai Copper Mine in northern New South Wales, which is one
of Australia's highest grading historic copper mines.
The group is listed on the LSE and ASX under the ticker
"CCZ."
References
1) Updated Mineral Resource Estimate for Cangai Copper Mine
announcement 25 July 2023
2) Board Changes announcement 10 October 2023
3) Strategic Asset Portfolio Review Underway announcement 17 October 2023
4) High-grade JORC Inferred Resource at Cangai Copper Mine
Exceeds Expectations announcement 6 September 2017
APPIX A: Key PROJECTS
Figure 2 : West and East Zone - BHA Project, Broken Hill Region
(Source: CCZ Geology Team)
Figure 3 : Zambia Copper-Belt Projects (Source: CCZ Geology
Team)
Figure 4 : NWQ Copper Project, Mt Isa Region (Source: CCZ
Geology Team)
APPIX B: Interest in mining tenements held
Table 3 : Jackaderry (Cangai), New England Orogen in NSW
Tenement ID Ownership at start Ownership at end Change during the
of Quarter of Quarter Quarter
EL8635 100% 100% -
------------------- ----------------- ------------------
EL8625 100% 100% -
------------------- ----------------- ------------------
EL8601 100% 100% -
------------------- ----------------- ------------------
Table 4 : Broken Hill, located within a 20km radius of Broken
Hill in NSW
Tenement ID Ownership at start Ownership at end Change during the
of Quarter of Quarter Quarter
EL8599 100% 100% -
------------------- ----------------- ------------------
EL8572 100% 100% -
------------------- ----------------- ------------------
EL 8434 100% 100% -
------------------- ----------------- ------------------
EL 8435 100% 100% -
------------------- ----------------- ------------------
Table 5 : Mt Oxide, Mt Isa region in North West Queensland
Tenement ID Ownership at start Ownership at end Change during the
of Quarter of Quarter Quarter
EPM 26513 100% 100% -
------------------- ----------------- ------------------
EPM 26525 100% 100% -
------------------- ----------------- ------------------
EPM 26574 100% 100% -
------------------- ----------------- ------------------
EPM 26462 100% 100% -
------------------- ----------------- ------------------
EPM 27440 100% 100% -
------------------- ----------------- ------------------
Table 6 : Zambia
Tenement ID Ownership at start Ownership at end Change during the
of Quarter of Quarter Quarter
24659-HQ-LEL (Mkushi) 100% 100% -
------------------- ----------------- ------------------
25195-HQ-LEL (Luanshya) 55% 55% -
------------------- ----------------- ------------------
25273-HQ-LEL (Luanshya) 55% 55% -
------------------- ----------------- ------------------
25261-HQ-LEL (Mwansa) 100% 100% -
------------------- ----------------- ------------------
Appendix 5B
Mining exploration entity or oil and gas exploration entity
quarterly cash flow report
Name of entity
-----------------------------------------------------
Castillo Copper Ltd
ABN Quarter ended ("current quarter")
--------------- ----------------------------------
52 137 606 476 30 September 2023
----------------------------------
Consolidated statement of cash flows Current quarter Year to date
(3 months)
$A'000 $A'000
1. Cash flows from operating
activities
1.1 Receipts from customers
1.2 Payments for
(a) exploration & evaluation
(b) development
(c) production
(d) staff costs
(e) administration and corporate
costs (282) (282)
1.3 Dividends received (see note
3)
1.4 Interest received 8 8
1.5 Interest and other costs of
finance paid
1.6 Income taxes paid
1.7 Government grants and tax
incentives
1.8 Other (provide details if
material)
---------------- -------------
Net cash from / (used in)
1.9 operating activities (274) (274)
----------------- ----------------------------------- ---------------- -------------
2. Cash flows from investing
activities
2.1 Payments to acquire or for:
(a) entities
(b) tenements
(c) property, plant and equipment
(d) exploration & evaluation (327) (327)
(e) investments
(f) other non-current assets
2.2 Proceeds from the disposal
of:
(a) entities
(b) tenements
(c) property, plant and equipment
(d) investments
(e) other non-current assets
2.3 Cash flows from loans to other
entities
2.4 Dividends received (see note
3)
2.5 Other (provide details if
material)
---------------- -------------
Net cash from / (used in)
2.6 investing activities (327) (327)
----------------- ----------------------------------- ---------------- -------------
3. Cash flows from financing
activities
3.1 Proceeds from issues of equity
securities (excluding convertible
debt securities)
3.2 Proceeds from issue of convertible
debt securities
3.3 Proceeds from exercise of
options
3.4 Transaction costs related
to issues of equity securities
or convertible debt securities
3.5 Proceeds from borrowings
3.6 Repayment of borrowings
3.7 Transaction costs related
to loans and borrowings
3.8 Dividends paid
3.9 Other (provide details if
material)
---------------- -------------
3.10 Net cash from / (used in) - -
financing activities
----------------- ----------------------------------- ---------------- -------------
4. Net increase / (decrease)
in cash and cash equivalents
for the period
Cash and cash equivalents
4.1 at beginning of period 2,897 2,897
Net cash from / (used in)
operating activities (item
4.2 1.9 above) (274) (274)
Net cash from / (used in)
investing activities (item
4.3 2.6 above) (327) (327)
4.4 Net cash from / (used in) - -
financing activities (item
3.10 above)
Effect of movement in exchange
4.5 rates on cash held (2) (2)
---------------- -------------
Cash and cash equivalents
4.6 at end of period 2,294 2,294
----------------- ----------------------------------- ---------------- -------------
5. Reconciliation of cash and Current quarter Previous quarter
cash equivalents $A'000 $A'000
at the end of the quarter
(as shown in the consolidated
statement of cash flows) to
the related items in the accounts
5.1 Bank balances 1,354 2,805
5.2 Call deposits 940 92
5.3 Bank overdrafts
5.4 Other (provide details)
---------------- -----------------
Cash and cash equivalents
at end of quarter (should
5.5 equal item 4.6 above) 2,294 2,897
----------------- ----------------------------------- ---------------- -----------------
6. Payments to related parties of the entity Current quarter
and their associates $A'000
Aggregate amount of payments to related
parties and their associates included in
6.1 item 1 59(1)
----------------
6.2 Aggregate amount of payments to related 113(2)
parties and their associates included in
item 2
----------------
(1) Comprises director's fees for the quarter.
(2) Comprises consulting fees paid to the Managing Director
and exploration expenditure paid to Field Crew Pty Ltd, a related
entity of director David Drakeley.
7. Financing facilities Total facility Amount drawn
Note: the term "facility' amount at quarter at quarter end
includes all forms of financing end $A'000
arrangements available to $A'000
the entity. Add notes as necessary
for an understanding of the
sources of finance available
to the entity.
7.1 Loan facilities
------------------- ----------------
7.2 Credit standby arrangements
------------------- ----------------
7.3 Other (please specify)
------------------- ----------------
7.4 Total financing facilities
------------------- ----------------
7.5 Unused financing facilities available at
quarter end
----------------
7.6 Include in the box below a description of each facility
above, including the lender, interest rate, maturity date
and whether it is secured or unsecured. If any additional
financing facilities have been entered into or are proposed
to be entered into after quarter end, include a note providing
details of those facilities as well.
----------------- ---------------------------------------------------------------------------
8. Estimated cash available for future operating $A'000
activities
Net cash from / (used in) operating activities
8.1 (item 1.9) (274)
8.2 (Payments for exploration & evaluation classified (327)
as investing activities) (item 2.1(d))
8.3 Total relevant outgoings (item 8.1 + item (601)
8.2)
8.4 Cash and cash equivalents at quarter end 2,294
(item 4.6)
8.5 Unused finance facilities available at quarter
end (item 7.5)
-------
8.6 Total available funding (item 8.4 + item 2,294
8.5)
-------
Estimated quarters of funding available
8.7 (item 8.6 divided by item 8.3) 3.8
-------
Note: if the entity has reported positive relevant outgoings
(ie a net cash inflow) in item 8.3, answer item 8.7 as
"N/A". Otherwise, a figure for the estimated quarters
of funding available must be included in item 8.7.
8.8 If item 8.7 is less than 2 quarters, please provide answers
to the following questions:
8.8.1 Does the entity expect that it will continue to
have the current level of net operating cash flows for
the time being and, if not, why not?
-------------------------------------------------------------------
Answer: N/A
-------------------------------------------------------------------
8.8.2 Has the entity taken any steps, or does it propose
to take any steps, to raise further cash to fund its operations
and, if so, what are those steps and how likely does it
believe that they will be successful?
-------------------------------------------------------------------
Answer: N/A
-------------------------------------------------------------------
8.8.3 Does the entity expect to be able to continue its
operations and to meet its business objectives and, if
so, on what basis?
-------------------------------------------------------------------
Answer: N/A
-------------------------------------------------------------------
Note: where item 8.7 is less than 2 quarters, all of
questions 8.8.1, 8.8.2 and 8.8.3 above must be answered.
----------------- -------------------------------------------------------------------
Compliance statement
1 This statement has been prepared in accordance with accounting
standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
Date: 30 October 2023
Authorised by: The Board of Directors
(Name of body or officer authorising release - see note 4)
Notes
1. This quarterly cash flow report and the accompanying activity
report provide a basis for informing the market about the entity's
activities for the past quarter, how they have been financed and
the effect this has had on its cash position. An entity that wishes
to disclose additional information over and above the minimum
required under the Listing Rules is encouraged to do so.
2. If this quarterly cash flow report has been prepared in
accordance with Australian Accounting Standards, the definitions
in, and provisions of, AASB 6: Exploration for and Evaluation of
Mineral Resources and AASB 107: Statement of Cash Flows apply to
this report. If this quarterly cash flow report has been prepared
in accordance with other accounting standards agreed by ASX
pursuant to Listing Rule 19.11A, the corresponding equivalent
standards apply to this report.
3. Dividends received may be classified either as cash flows
from operating activities or cash flows from investing activities,
depending on the accounting policy of the entity.
4. If this report has been authorised for release to the market
by your board of directors, you can insert here: "By the board". If
it has been authorised for release to the market by a committee of
your board of directors, you can insert here: "By the [name of
board committee - eg Audit and Risk Committee]". If it has been
authorised for release to the market by a disclosure committee, you
can insert here: "By the Disclosure Committee".
5. If this report has been authorised for release to the market
by your board of directors and you wish to hold yourself out as
complying with recommendation 4.2 of the ASX Corporate Governance
Council's Corporate Governance Principles and Recommendations, the
board should have received a declaration from its CEO and CFO that,
in their opinion, the financial records of the entity have been
properly maintained, that this report complies with the appropriate
accounting standards and gives a true and fair view of the cash
flows of the entity, and that their opinion has been formed on the
basis of a sound system of risk management and internal control
which is operating effectively.
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END
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