Following successful completion of a jointly designed validation program, BHP has exercised its option to enter a farm-in and joint venture agreement with Australia’s Encounter Resources covering the Elliott copper project in the Northern Territory.
The farm-in and JV deal follows last September’s option agreement between the companies, pursuant to which BHP may earn up to a 75% interest in the project by spending up to A$22 million ($17 million) over 10 years.
According to Encounter, the Elliott project represents a “compelling exploration opportunity” in the vastly underexplored Greater McArthur Superbasin that contains the key ingredients for the formation of large sedimentary copper deposits.
“Copper sourced from sedimentary-hosted deposits is one of the fastest growing sources of high-grade copper in the world. Encounter controls an extensive first-mover portfolio of copper projects in the Greater McArthur Superbasin in the NT,” Encounter managing director Will Robinson said in a statement on Friday.
“The potential for this region to host large sedimentary-hosted copper deposits is rapidly emerging, and we are delighted to be teaming up with BHP to apply leading edge technologies in the search for Tier 1 copper deposits at Elliott,” Robinson added.
Elliott was the first project secured by Encounter in the NT and comprises seven tenements covering more than 4,500 km2.
The property is located at a major structural intersection on the southwestern margin of the Beetaloo Basin, which is part of the Greater McArthur Superbasin that hosts the giant sediment-hosted base metal deposit at McArthur River.
The upcoming exploration program at Elliott will be focused on the deployment of leading-edge technologies, initially applying the expertise and knowledge developed during oil and gas exploration of similar basins.