New 6km copper trend adjacent to Mt Kelly and McLeod Hill expands near-facility copper oxide exploration strategy.
Highlights:
• EPM 28881 (“Canyon”) granted adjacent to Austral’s Mt Kelly and McLeod Hill Mining Leases and within short haulage distance to the Company’s SX-EW facility.
• 6km of strong surface copper anomalism identified, including exposures of undrilled copper oxide mineralisation.
• The new EPM enables further exploration and extension testing of Austral’s McLeod Hill copper resource within an established operational footprint.
• Drilling planned for 2026 to test priority oxide targets and assess their potential integration into future mine planning.
Copper producer Austral Resources Australia Ltd (ASX:AR1) (“Austral” or the “Company”) is pleased to announce that it has been granted EPM 28881 (“Canyon”), securing a strategic landholding adjacent to the Company’s existing Mt Kelly and McLeod Hill assets. The position and prospective footprint of the newly granted tenement provide a strong foundation for advancing near-facility copper oxide exploration.
The Canyon EPM covers a region that has historically been tightly held but underexplored, despite clear geological indications of continuity between surface mineralisation and known copper resources immediately to the south.
Austral’s Chairman, David Newling commented:
“Canyon provides us with meaningful near-facility exploration upside at a time where the broader North West region continues to emerge as one of Australia’s most prospective copper jurisdictions. We now control a 6km copper corridor that physically connects exposed mineralisation to existing resources and operational infrastructure.”
Strategic Importance of the Canyon EPM
The Canyon EPM consolidates control over a known copper anomalous corridor adjacent to existing operations and provides the Company with an expanded opportunity set to define additional oxide mineralisation proximate the Mt Kelly SX-EW plant.
Strategically, the Canyon EPM delivers:
• An exploration pathway directly adjacent to current infrastructure
• Potential extensions to the McLeod Hill mineralised system
• Multiple undrilled positions of exposed copper oxide mineralisation
• A clearly defined corridor that can be assessed in parallel with existing development studies.
Success across these targets has the potential to support the Company’s broader objective of maintaining optionality around future oxide mine sequencing and processing strategies.
The Canyon EPM - A Tightly Held Opportunity
The Canyon EPM was formally granted to Austral Resources on the 4 December 2025 for an initial 5 year term. The tenement area has been held by only two other operators in the past 26 years, and as a result, much of the Canyon Trend remains largely underexplored, despite its strategic location and attractive geological architecture.
The Canyon Trend – 6km of Compelling Copper Footprint
The Canyon Trend defines a ~6 km long corridor of elevated copper anomalism (peak values exceeding 330-times background (max. Cu-in-soils = 1.65% Cu), extending between:
• McLeod Hill Resource (1.68 Mt at 0.64% Cu) at the southern end, and
• Swagman Resource (330 kt at 0.6% Cu) in the north.
Significantly, broad exposures containing copper oxide mineralisation outcrop throughout the area representing priority targets for exploration follow-up and drill testing.
Proximity of the EPM to Austral’s operational SX–EW facility makes the area particularly compelling asset for continued assessment and potential future integration into the broader oxide development strategy.
The Concept – Unlocking New Copper Discoveries
Austral’s extensive work across the Western Isa Succession has built a strong understanding of the regional copper systems, and this knowledge is now being applied to drive new discoveries within the Canyon EPM. The geological model is straightforward and well supported by local deposits: copper is sourced from mafic volcanic units at depth, mobilised along major fault corridors, and ultimately trapped or precipitated within the carbonaceous shales of the upper Gunpowder Creek Formation.
Importantly, copper mineralisation is not restricted to fault zones. It commonly spreads laterally into chemically favourable stratigraphic horizons, particularly the carbonaceous units that are known hosts of sediment-hosted copper systems worldwide. This expands the search space significantly and supports the potential for broader, stratigraphically controlled mineralisation within the project area.
Challenges and Opportunities
A notable feature of the Canyon EPM is the presence of a 5–10 m thick, silcretised Mesozoic cover sequence across much of the prospective terrain west of the McNamara Fault and north of McLeod Hill. This hard, plateau-forming cover effectively renders any underlying copper oxide mineralisation ‘blind’ to conventional surface geochemical sampling, creating challenges for target definition and drill prioritisation.
However, this same cover also presents a genuine discovery opportunity. Blind systems have historically delivered some of the region’s most meaningful finds, and the silcrete cap has the potential to preserve copper oxide mineralisation by shielding it from erosion over geological time.
Recent drilling completed by Austral in 2023 within the northern McLeod Hill Mining Lease appears to support this interpretation. Hole MTKC06423 intersected a notably broader oxide interval compared to earlier drilling located in the valley floor, where erosion has been more pronounced.
The rugged, gorge-style topography presents an additional technical challenge. Down-slope movement of soil and rock has caused transport and dispersion of copper anomalism into lower elevations, occasionally masking the true position of mineralisation within the canyon walls above. Understanding and correcting for this displacement is a key part of refining drill targets in the next phase of exploration.
Proof of Concept – Copper Oxide Exposures
Extensive soil sampling across the Canyon Trend highlights its strong geological potential, with maximum copper-in-soil values of 0.37% Cu in the north and up to 1.65% Cu in the south. These high-tenor surface results complement the extensive exposures of copper oxide mineralisation (typically malachite, azurite and chrysocolla) visible along the canyon walls, providing a clear surface expression of a mineralised system of meaningful scale.
Historical drilling was limited in scope and is now interpreted to have been ineffective, largely due to collar locations set too close to the McNamara Fault. This positioned the majority of drilling within the barren basement units of the Surprise Creek and Fiery Creek formations, effectively testing the wrong stratigraphic position. Compounding this, the steep escarpment terrain has caused downslope transport of copper-enriched soils and talus, creating false anomalies in the lower topography that ostensibly misled previous targeting.
Austral’s approach will directly address these shortcomings. The Company intends to step drilling back from the fault zone and instead target the visible copper oxide mineralisation hosted higher in the canyon walls, with the potential for this mineralisation to continue beneath the silcrete cover sequence. This cover both conceals and may have preserved additional copper oxide material, presenting a compelling exploration opportunity.
McLeod Hill Extensions Enabled by Granting of the Canyon EPM
Recent drilling has confirmed that the McLeod Hill Deposit remains open to the north, with hole MTKC06424 (completed in 2023) intersecting:
• 29m at 0.77% Cu from 39 m, including
• 5m at 1.97% Cu from 63 m.
The style and geometry of mineralisation indicate that copper continues beneath the younger silcretised cover, where it is obscured from conventional surface detection methods. Historical MMI geochemistry, used specifically to detect trace anomalism through cover, supports this interpretation, with copper anomalism aligning closely with the modelled synclinal closure of the carbonaceous shale unit that hosts the existing resource.
Improved structural mapping has also highlighted a significant opportunity south of the current McLeod Hill Resource. Here, the target stratigraphy is offset and truncated by crosscutting faults, disrupting lateral continuity of the target stratigraphy. High-tenor copper anomalism (>1,000 ppm Cu) and visible copper oxide mineralisation have been identified at surface and define the trend of the carbonaceous shale unit. Remarkably, this area remains untested by drilling, despite lying within a long-held mining lease.
The Pandemonium Prospect, located immediately south of the McLeod Hill ML, is centred around an encouraging surface copper anomaly, with peak anomalism reaching 0.23% Cu (2300 ppm Cu). It is interpreted to reflect the southernmost extension of the McLeod Hill copper system. Despite being historically identified as an attractive target requiring drill testing, previous attempts collared too close to the basement unconformity to be considered an effective test.
With the granting of the Canyon EPM, the Company now has the tenure required to advance this broader mineralised footprint. A staged drilling program is planned for 2026, initially targeting these newly defined positions before working to extend and tie into the existing McLeod Hill Resource.
Forward Exploration Strategy and Further Work
The Canyon Trend, including potential extensions to the McLeod Hill resource, represents a series of highly encouraging geochemical exploration drill targets, backed by untested exposures of Cu oxide mineralisation.
A staged exploration drilling programme is the logical next step to follow up the compelling targets and copper anomalies within the newly granted Canyon EPM. The initial focus will be on defining additional copper oxide mineralisation peripheral to the McLeod Hill Mining Lease, both to the north and south, in order to progress the resource through the requisite technical studies and bring it online as a potential future feed source for Austral’s SX-EW facility in the adjoining lease.
Exploration drilling is also scheduled for 2026 across the Canyon EPM targeting the Canyon North and South prospects to assess the size and grade potential of Cu oxide exposed so prominently within the escarpment walls and defined by surface geochemistry. The Pandemonium Prospect will also be drill tested, given the tenor of geochemical anomalism and proximity to the McLeod Hill Mining Lease.
About us:
About Austral Resources
Austral Resources Australia Ltd is an ASX listed copper cathode producer operating in the Mt Isa region, Queensland, Australia. Its Mt Kelly copper oxide heap leach and solvent extraction electrowinning (SX-EW) plant has a nameplate capacity of 30,000tpa of copper cathode. The recent acquisition of the Rocklands Facility enables the dual processing capabilities for copper sulphides and copper oxides, as well as an increased exposure to gold.
Austral has recently embarked on an aggressive growth and consolidation strategy across the World Class Mount Isa Region, which includes the Rocklands Deposit. Austral now owns a significant copper inventory with a JORC compliant Mineral Resource Estimate standing at 64 Mt @ 0.73% Cu (468 414t of contained copper) (comprising of 52.8Mt @ 0.74% Cu at the Lady Annie Project – 8.8Mt at 0.75% Cu Measured MRE, 33.0Mt at 0.76% Cu Indicated MRE and 11.0Mt at 0.69% Cu Inferred MRE and 11.26Mt at 0.69% Cu at the Rocklands Project – 9.12Mt at 0.72% Cu Indicated MRE and 2.14Mt at 0.55% Cu Inferred MRE), two processing facilities, as well as 2,101km2 of highly prospective exploration tenure in the heart of the Mt Isa district, a world class copper and base metals province. The Company intends to implement an intensive exploration and development programme designed to extend the life of mine, increase its resource base and continually review options to commercialise its copper resources.
Contact details:
Jane Morgan Management
Jane Morgan
P: +61 405 555 618
E: [email protected]