Is Carrapateena on the auction block?

The Carrapateena polymetallic project raised eyebrows earlier this decade with what must be the best mineral intersection ever in Australia but it has been relatively dormant since the global financial crisis. Now development options are being explored - an euphemism for a joint venture or sale.

PERTH - 

The global banker and resource financier Rothschild said Wednesday it has been retained by owners of the Carrapateena project to assess the strategic options for owners Teck Australia and RMG Services.

The project is on the eastern margin of South Australia's Gawler Craton that contains BHP Billiton's world class Olympic Dam copper-uranium-gold mine and OZ Minerals' recently commissioned Prominent Hill copper-gold mine.

Carrapateena hit world business headlines on the basis of just one of its significant drill holes - 905 metres grading 2.17% copper, 0.9 grams/tonne gold, 11.5 g/t silver, 255 ppm uranium, 38.8% iron, 0.169% cerium and 0.104% lanthanium.

Teck Australia is subsidiary of the big Canadian miner Teck Resources Ltd (TSX & NYSEL TCK) that was attracted to the project after one of two first-pass drill holes - in part financed by the South Australian Government's PACE programme. A Teck official virtually sat on the doorstep of Rudy Gomez, the Adelaide engineer who risked drilling this project and gained an option over Carrapateena.

Gomez's private company RMG Services remains an active partner in the project and, before the global financial crisis, there was speculation as to how many millions of dollars he would get in the buy-out.

However, Teck Resources was one of the majors hardest hit by the late 2008 recession and may be looking to another major to develop the project which is centred between the sparsely populated region between Olympic Dam and the Spencer Gulf port city of Port Augusta.

Rothschild's Sam Brodovcky said copper mineralisation at Carrapateena consists of chalcopyrite and bornite with a high-grade bornite zone.

He said it was situated outside the Woomera Prohibited Zone (that created angst with Australia's Defence Department over the original intention for OZ Minerals to sell Prominent Hill with all its other mining assets to China's Minmetals) and that it was near key infrastructure such as rail, road and port.

Other major drill intercepts were 903m @ 2.15% Cu, 0.66 g/t Au, 9 g/t Ag and 316 ppm U; 410m @ 1.88% Cu, 1.2 g/t Au, 18.7 g/t Ag and 343 ppm U; and 905m @ 2.08% Cu, 0.98 g/t Au, 8.5 g/t Ag and 278 ppm uranium.

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