BHP eyes porphyry target

The Chilean subsidiary of Australia’s Broken Hill Proprietary (BHP-N) has signed a letter-of-intent to acquire the Elvira copper porphyry prospect in the Atacama Desert.

BHP can purchase the 110-sq. km property in return for US$1.4 million, to be paid over three years. The vendor, Yamana Resources (YRI-T), will retain a 2% net smelter royalty on future production.

A geophysical survey by Yamana outlined a 10-km doughnut-shaped magnetic anomaly coincident with northeasterly trending faults and suggestive of porphyry mineralization. However, follow-up drilling returned only trace amounts of copper in a zone of disseminated pyrite.

Elvira sits astride the southern extension of the West Fissure zone, which stretches north-south and is home to some of the largest copper deposits in the world, including the Escondida mine, which is 57.5%-owned by BHP.

BHP expects to begin drilling at Elvira once it signs a definitive agreement.