The appetite for copper in Western Australia is growing amid some promising discoveries and strong prices for the key metal.
Sparked by Sandfire Resources’ high-grade greenfields discovery at DeGrussa in 2009, several WA explorers are confirming the promise for copper in the Doolgunna area, 150km north of Meekatharra.
Copper is historically one of the few commodities where WA is a smaller producer compared with other Australian states.
Data released by the federal government’s Bureau of Resources and Energy Economics show the state was the fourth-largest producer of the base metal in the December quarter with output of about 38,000 tonnes.
South Australia, home to BHP Billiton’s giant Olympic Dam mine, was the top-producing state with 84,000 tonnes. Queensland (75,000t) and New South Wales (45,000t) rounded out the top three. WA is set to receive a boost in copper production through Sandfire, which is now on the verge of starting exports from DeGrussa.
The company started mining its open pit for direct shipping ore (DSO) last month, saying the product would be shipped to companies in Switzerland and China during the next quarter.
Sandfire is also developing an underground mine at DeGrussa, to extract its massive sulphide ores.
The company has forecast DeGrussa to produce about 77,000t a year over its first three years of production.
WA’s top-producing copper operation in 2010-11 was Aditya Birla’s Nifty operation in the east Pilbara, with about 58,000t.
Production from other mines at Doolgunna is likely to be at least a couple of years away; with Ventnor Resources being arguably the most advanced company down this path.
Ventnor, which listed on the Australian Securities Exchange early last year and has since more than tripled in value, is drilling at the Thaduna and Green Dragon projects, about 40km east of DeGrussa.
In comparison to DeGrussa, Ventnor managing director Bruce Maluish said the company would not match Sandfire’s high grades.
However, he said Thaduna and Green Dragon were on course to be open-cut operations, providing lower costs and lifting its margins nearer to those of Sandfire.
“I can see Doolgunna potentially becoming a substantial copper province – I don’t think ours are there in isolation,” Mr Maluish said.
“It all seems to be pretty well funded (in the region) so I can see more results coming out of the area in the next 12 months or a couple of years.”
Analysis by Perth-based RM Research has backed this view, stating that the copper endowment of Doolgunna “is significantly more widespread than first thought”.
This has also been supported by Sipa Resources, which owns tenements surrounding Ventnor’s projects and has hit high-grade copper returns at its own Thaduna prospect.
South of DeGrussa, Thundelarra Exploration, Dourado Resources and Enterprise Metals are also showing promise for copper from their large, yet lightly explored tenements.
