Copper-gold in Utah and lithium in Brazil

Alderan Resources Limited (ASX:AD8) Managing Director Scott Caithness discusses the company's exploration targets and progress.

Peter Milios: I'm Peter Milios from the Finance News Network, and today we're talking with Alderan Resources (ASX:AL8). Alderan is trading under the ASX code "AL8" and has a market capitalisation of approximately $4.4m. Alderan Resources specialises in critical and precious metal exploration. Today we're pleased to have with us Alderan's Managing Director Mr Scott Caithness. Scott, welcome to the network.

Scott Caithness: Thanks very much, Peter. It's great to be here.

Peter Milios: Now, first, let's kick off by painting some colour on the overall operations of Alderan Resources.

Scott Caithness: Look, Alderan's a mineral exploration company. Our assets are in the US and also in Brazil. So, our prime project that we're exploring at the moment is the Frisco Copper-Gold Project in Utah in the US. We've also got a couple of other gold targets there. And we're also actively exploring for lithium in Brazil. We've got eight separate projects in Brazil that we're exploring for lithium.

Peter Milios: Now, you've had a busy month, making several big announcements. Could you please outline these announcements at your projects over the course of the month? Notably the most recent one, the approval to commence drilling at the New Years Copper-Gold prospect in Utah.

Scott Caithness: Yeah, look, we're very excited about the New Years prospect in Utah. That's part of our Frisco project area. And Frisco is basically, it's an old copper-gold mining district. Copper and gold mining ceased in the area in about 1920. So, it really hasn't had a lot of work done on it since then. We basically, over the course of the last few months, we've gone back to the areas that were explored, primarily around the Cactus district. We've remodelled the old Cactus deposit, which historically produced about 1.3 million tonnes at about 2 per cent copper with about a 0.3 gram per tonne gold credit. What we found from that modelling is that there's probably a lot more mineralisation left behind than what was there because there's been quite a number of holes drilled probably over the last 30 to 40 years at Cactus with some really good intersections. Intersections of 5m, 6m, anything up to close to 6 to 7 per cent. Intersections of 12m, grading about 3 per cent, generally, within broader zones that will grade 1, 1.5 per cent copper.

Often the drill holes were historical, so in many cases there wasn't gold assayed. But where there is gold assayed, generally, a gold credit of around about 0.3 grams per tonne gold. So, quite an exciting prospect in itself. So, that modelling actually identified that Cactus is still open at depth, it's still open along strike. But the most interesting thing that came out of that modelling is that there is a prospect called New Years, which is about 400m or 500m along a structural trend that goes through Cactus. And what we found from that was there's some old drill holes at New Years that were drilled back in the 1960s, 14m at 2.3 per cent copper. There's other intersections of around about 11m at about 1.5, 1.6, again within broader zones, that will grade anywhere between 0.8 copper and about 1.6, 1.7 copper.

But New Years hasn't been drilled since the 1960s, so we are very excited. We've done this modelling work in terms of the mineralisation. We've also looked at the geophysics for the area, the magnetics. And so what we did was we got the magnetics, which was magnetics flown by Rio Tinto (ASX:RIO). So, Rio Tinto had explored the area in a joint venture with us, an earn-in agreement, for large-scale, Rio Tinto-scale porphyries, 1 billion tonnes at 1 per cent copper-type stuff. We're going back and we're looking at the smaller, higher-grade opportunities that exist there that aren't Rio Tinto targets. But as part of their exploration, Rio Tinto flew a very high-quality magnetic survey over the area. And we went back and we remodelled that magnetics and reprocessed it from the point of view of smaller higher-grade targets. And what we found is that Cactus has a very discrete magnetic anomaly that sits within a corridor of magnetic low. There is a little deposit next door to Cactus, which was basically gold-rich grade and greater than a gram per tonne gold in its historical production with a copper credit.

When we go up to New Years, New Years has a larger discrete magnetic anomaly, and it's sitting in the same corridor. And it's only 400m away. It's got high-grade copper intersections. And, again, it hasn't been explored since the 1960s. So what we've done recently is we've gone back and we've done soil sampling over it, over the New Years, to see if soil sampling works because the magnetics not only picked up the New Years target, it picked up about another 12 targets that looked like Cactus and Comet. And so we wanted to know whether, first of all, soils would work in terms of prioritising these other targets, and also, obviously, whether it picks up the New Years mineralisation. So what we found with that is we got grades up to 0.3, plus another three anomalies in the area. So, we're very excited about it. We've put in a permit for drilling. We've got a two-stage drilling program. Initially, we're going to be doing three holes, which has been what's been approved by the government. And then once we've drilled those three holes, assuming we get good results, then basically, we'll do stage two drilling, which is more step-out and extension work. So, that's primarily what we're doing at Frisco.

In Brazil, we're basically, still getting results back from the initial round of stream sediment sampling that we did over the project areas. So, that work to date has picked up in three areas. It's picked up lithium anomalies and also it's picked up in two of the areas, actually, rare-earth anomalies as well to be followed up. So, that's part of our plan in the second half of the year as well.

Peter Milios: And Scott, last question from me. You touched on this already, but could you go in a bit more detail about what the next 6 to 12 months will look like for the company?

Scott Caithness: Yeah, look, obviously, the critical thing for us is we want to drill the Frisco project. We've got to get that drilling underway. We're optimistic about the results. I mean, it's an old copper and gold-mining district. We are in the right structural corridor, we've got good anomalies, we've got old drill holes that have been drilled in the past, so we're quite optimistic about it. And we've got a lot of targets to test that are the right style of mineralisation. So, obviously, if our first round of drilling there is successful, we'll want to keep drilling. So, critically it'll be… And that'll be happening in the second half of this year. We expect that the drilling will actually get underway next month in August.

Obviously, in terms of the lithium in Brazil, we've got follow-up work to do on those projects that we've just done the stream work on, picking up the anomalies. We also picked up, a couple of months ago, on another project in Brazil, which is a little bit more advanced. Again, lithium, called the Salitre project. The Salitre project is a very, from my perspective, a very simple project to explore. It's basically… It's got defined already a 4.5km-long lithium in soil anomaly. It's got a gap in the drilling then for about 4km, and then it's got another anomaly, a small anomaly at the end of that gap. So, potentially, it's a 9km-long lithium in soil anomaly. Very simple in terms of the work to be done there. We can either drill some traverse lines of drill holes across the anomaly to just see whether there's any lithium-bearing pegmatites there. And also we can fill in the soil geochem as well in the gap period. So, it's a fairly straightforward program on that one, which we want to get underway in the second half of the year as well. So, we've got a lot of work to be done in the second half of this year. And we'll have good news flow going through that period.

Peter Milios: Perfect. Sounds exciting times ahead. Thank you, Scott, for your time.

Scott Caithness: Thanks very much, Peter.