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Castillo Copper - Outstanding massive sulphide copper results at Cangai

Sep 2018

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Summary - Outstanding massive sulphide copper results at Cangai

Castillo Copper Limited (ASX:CCZ) has announced assay results from its ongoing drill program at the company’s Cangai copper project in NSW. Highlights of the announcement include the following.

  • The current drilling campaign (five out of 39 drill-holes completed to date) has returned the following results.
    • CC0023R: 11 m @ 5.94% Cu; 2.45% Zn and 19.13 g/t Ag from 40 m, including:
      • 3 m @ 8.1% Cu, 2.84% Zn and 23.42 g/t Ag from 41m
      • 1 m @ 10.25% Cu, 1.68% Zn and 32.50g/t Ag from 48 m
      • 1 m @ 7.53% Cu, 6.04% Zn & 30.60 g/t Ag from 50 m
  • CC0025R: 3 m @ 2.66% Cu, 0.50% Zn and 7.38 g/t Ag from 90 m
  • CC0022R: 2 m @ 2.50% Cu, 0.38% Zn and 9.78 g/t Ag from 92 m
  • A downhole electromagnetic (DHEM) team has been deployed to site and is currently refining the drilling campaign’s trajectory to determine extensions to the newly discovered mineralisation.
  • A diamond drilling rig has been mobilised to perform follow-up infill work.

Analyst comments: This is an outstanding result from Castillo, with hole CC0023R (see above) one of the highest-grade copper intercepts for an Australian exploration project in recent memory.

Importantly, this could be the discovery of a new lode at Cangai, bringing the total number of lodes identified to date to seven. With none of the current lodes deeper than 150 metres from surface across a strike of less than 1 kilometre, the potential for additional discoveries is excellent.

Interestingly, hole CC0023R was targeting a deeper DHEM anomaly. However, it intercepted massive sulphide before the target was reached. That hole is now being used for further DHEM, which should provide a clearer understanding of the initial target, as well as, hopefully, identifying additional targets in the area. We see the potential for further discoveries at depth (to date largely untested) as the greatest upside for further high-grade discoveries in the near term.

We look forward to the results from the DHEM, an exploration technique which has proved to be highly successful at Cangai, as well as continued drilling results as they are released over the coming months. We maintain our assessment of Castillo as a SPECULATIVE BUY.