Galileo has entered into a Joint Venture Agreement (“JV Agreement”) with Statunga Investments Limited (“Statunga” or “the Vendors”), a private Zambian company which holds the Luansobe Project (“Project”) comprising small-scale exploration licence No. 28340–HQ-SEL in the Zambian Copperbelt.
The Luansobe Copper Project
The Luansobe area is situated some 15km to the northwest of the Mufulira Mine in the Zambian Copperbelt which produced well over 9Mt of copper metal during its operation. It forms part of the northwestern limb of the northwest – southeast trending Mufulira syncline and is essentially a strike continuation of Mufulira, with copper mineralisation hosted in the same stratigraphic horizons. At the Luansobe prospect mineralisation occurs over two semi-contiguous zones, dipping at 20-30 degrees to the northeast, over a strike length of about 3km and to a vertical depth of at least 1,250m.
Historical work focused on the upper zones of the deposit which are relatively leached in the top 30m from surface, with oxide mineralisation occurring below to a depth of roughly 70m. At acquisition, the deposit was reported to be open and relatively untested at greater depth, where the copper generally occurs as sulphides.
Based on historical data, about 30% of the total contained copper occurs in acid soluble form (as copper oxide) – which is expected to be higher in the shallower parts of the deposit.
Galileo planned to complete rapid resource definition on the Luansobe project, confirming historical reported resources to JORC (2012) Mineral Resource Status with a focus on the early-mining potential of the shallower oxide copper, as well as the development of a larger-scale copper sulphide mine.
Since acquisition in December 2021 the company has completed twenty-eight vertical diamond drill holes for a total of 3,564m of drilling which has successfully identified wide zones of moderate grade, near-surface copper mineralisation, potentially offsetting open pit pre-stripping costs and positively impacting project economics.
Drilling highlights include:
– 23.73m @ 2.63% Cu from 85.27m in hole LUDD013
– 2.56m @ 2.78% Cu from 45.44m in hole LUDD005
– 16.39m @ 0.95% Cu from 54.0m in hole LUDD009
– 7.0m @ 0.66% Cu from 21.0m in hole LUDD006
On the 9th February 2023 the company announced a new Inferred Mineral Resource for the project inclusive of:
– Approximately 5.8 million tonnes gross at 1% total Cu above a cut-off grade of 0.25% total Cu for 56,000 tonnes of contained Cu, potentially amenable to open pit mining.
– Approximately 6.3 million tonnes gross at 1.5% total Cu above a cut-off grade of 1% total Cu for 97,000 tonnes of contained Cu, potentially amenable to underground mining.
Further exploration potential exists in the southeast of the Luansobe licence area which remains under-explored with insufficient data to allow estimation of a mineral resource. Historic drilling in this area suggests an exploration target of approximately 3 million to 7 million tonnes between depths of 100 to 300m with grades in the region of 1% to 1.5% total Cu. The target area is approximately 2 km by 1 km in surface expression. The exploration target is conceptual in nature and may not be realised. Galileo plans to test the exploration target following evaluation of the open pit mining potential and, given favourable results, the commencement of production. Approximately 5,000m of drilling is recommended to test the area.
Joint Venture Agreement
The JV Agreement provided Galileo the right to earn an initial 75% interest in a special purpose joint venture company to be established under Zambia law to, with Ministerial consent, acquire the exploration licence and the technical data related to the Luansobe Project by making two payments of US$200,000 each (subject to project due diligence) and issuing 5,000,000 Galileo shares to the Vendors.
These conditions were met by the company and as per the JV agreement, Galileo will continue to evaluate and optimise project feasibility in parallel to seeking third party quotes for contract mining as referred to above.
If a decision to mine is made by Galileo, then the parties will be entitled to fund pro rata to their beneficial interest in the JV Company. Any funding shortfall by the Vendors will be recovered from subsequent mine production.