Explorer and developer Strategic Energy Resources (SER) on Friday announced that it had bought the Diamantina copper/gold project in western Queensland from Anglo American in a cash-and-scrip deal that will see the global miner become a shareholder in the junior explorer.

The acquisition grants SER full ownership of two granted exploration permits (EPM27134 and EPM27135) covering 630 km², and three adjoining applications (EPM29278-29280), expanding its landholding in what it believes to be a next major copper/gold frontier.

Located 280 km south of Cloncurry, the Diamantina project sits over the undercover southern extension of the Mt Isa Eastern Fold belt and is bounded by the Pilgram Fault. Initial drill results from the Elizabeth Springs East prospect returned 17.37 m at 1.76% copper and 0.37 g/t gold from 465.3 m, within a broader intercept of 161 m at 0.4% copper and 0.11 g/t gold from 449 m.

“The Mount Isa Inlier is one of the most metallogenic regions in the world and it is our belief that undercover extensions both north and south are the next frontier for major mineral discoveries,” said SER MD David DeTata.

“SER has already secured the northern extensions with our Isa North and Canobie projects and with acquisition of Diamantina and the surrounding ground, we now control the southern extension.”

Anglo American began systematic exploration at Diamantina in 2018, narrowing focus through geophysics and geochemistry before stepping back from the project earlier this year.

“Earlier this year SER was invited to bid for the Diamantina project as Anglo American had determined the project was no longer aligned with their global strategy,” DeTata added. “The team was ultimately successful due to our ability to demonstrate a focus on discovery and expertise in undercover exploration. With the project and surrounding tenure now secure, we can begin to unlock the potential of Diamantina.”

Under the terms of the sale and purchase agreement, SER will acquire 100% of exploration permits EPM27134 and EPM27135 from Anglo American for total consideration of A$300 000 in cash and A$300 000 in SER shares. 

Completion is conditional upon Ministerial approval of the permit transfers.

Anglo American will retain a 2% net smelter royalty on production, with SER retaining the right to buy back 0.5% for A$10-million or 1% for A$30-million within two months of completing a bankable feasibility study. SER is also obligated to spend a minimum of A$1-million on exploration within the first two years; otherwise, Anglo American may exercise a clawback option on the tenements.