Rare earths resource boost in sight as Red Metal drills Qld giant

Red Metal has fired up the drill rigs for a 5000-metre drilling tilt at its giant Sybella rare earths project near Mount Isa in Queensland, aiming to both upgrade and extend its priority Kary Zone deposit ahead of upcoming economic studies.

Infill drilling will focus on Sybella’s southeast corner of its nearly five-billion-tonne resource, targeting broad, near-surface, higher-grade zones to boost confidence in the area earmarked for initial mining.

In parallel, extensional drilling will step out to test the interpreted southeast extension of Kary, where limited historical drilling and surface mapping have hinted at the potential for higher-grade mineralisation beyond the already massive mineralised footprint.

Management says the new drilling is building directly on mapping and metallurgical results from the past two years, which have focused on proving up a low-cost, heap-leach development scenario. Column leach tests have already delivered promising extraction rates of 70–78 per cent for the valuable magnet rare earths neodymium and praseodymium, using a low-intensity, lower-cost acid leaching process.

Red Metal says assay results from the current campaign are expected early in the new year. The data will be used to update the mineral resource estimate for the Kary Zone, which will then feed into the final mine model for the Sybella prefeasibility study. The company has slated completion of the prefeasibility study in the first quarter of next year.

The prize for Red Metal is a low-cost, low-capex processing route for its geologically unique and potentially globally significant mineral deposit. The company has already defined a monster 4.795-billion-tonne inferred resource at Sybella, where the sheer scale and potential for zero-strip mining make bulk-tonnage processing methods such as heap leaching a very attractive option.

The company has recently kicked off crucial mining-scale column leach tests for Sybella, a key final validation step to prove up its low-cost leaching strategy ahead of a prefeasibility study (PFS) targeted for completion early next year. Results from both a six-metre column and a coarser-crush two-metre test will be reported in the coming months, then extrapolated into economics and the soon-to-be-upgraded resource.

While Sybella remains the flagship, Red Metal is also ramping up a new “Big Copper” strategy, hunting giant iron-oxide-copper-gold (IOCG) discoveries in the famed Mt Isa province, at the doorstep of nearby heavyweights, the Ernest Henry and Osborne deposits.

With its giant resource base just 20 kilometres from the major mining hub and a clear strategy in place to prove up a low-cost, large-scale operation, Red Metal appears to be approaching D-Day in de-risking its flagship asset.

If Red Metal can crack the heap-leach equation, Sybella’s near-5-billion-tonne endowment could be more than just a monster - it could become a major player in the West’s magnet metal supply.

Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au