South Australia’s Kalkaroo copper-gold project is set to advance after an agreement between Havilah Resources and Sandfire Resources to establish grounds for regional exploration.
The execution of the binding term sheet between Havilah and Sandfire comes with the possibility of a minimum 20,000-metre infill and extension drilling program following completion of a new pre-feasibility study (PFS).
The agreement, valued at up to $240 million, outlines a two-stage earn-in structure that would see Sandfire acquire up to an 80 per cent interest in Kalkaroo.
This development also enables Sandfire to potentially expand the site’s existing 100 million tonne ore reserve, one that holds a 0.47 per cent copper (Cu) grade and a 0.44 gram per tonne (g/t) gold (Au) grade.
This is also underpinned by a sulphide mineral resource of 224 million tonnes with 0.49 per cent Cu and 0.36g/t Au, with both companies eager to build on the “highly prospective” Curnamona Province in the state.
Kalkaroo is recognised as one of Australia’s largest undeveloped open-pit copper-gold projects, offering substantial opportunity to bolster the nation’s copper supply as the demand for critical minerals grows.
Sandfire chief executive officer (CEO) and managing director Brendan Harris said the company is thrilled to work with Havilah to de-risk the Kalkaroo project.
“This [site] is in a preferred jurisdiction with ready access to key road, rail, and energy infrastructure and groundwater supply, [with] skilled labour from Adelaide, Broken Hill, and the broader regional community,” he said.
“The decision to move into the Curnamona Province in South Australia is fully aligned with our strategy and has the potential to replicate our successful entry into the Kalahari copper belt.”
Havilah technical director Chris Giles said the company is eager to work with Sandfire to complete the PFS and drilling program.
“Immediate value for Havilah shareholders will be realised via an upfront payment, which also gives Havilah a direct stake in Sandfire’s successful global mining operations via the share component,” he said.
“The funding under the exploration strategic alliance will allow us to accelerate regional exploration in South Australia with the objective of transforming the highly prospective province into Australia’s next major copper province, centred on Kalkaroo.”
The alliance will see Sandfire and Havilah jointly explore Havilah’s broader Curnamona tenements over a 24-month period, with funding directed toward identifying additional copper-gold prospects beyond the Kalkaroo deposit.
Under the term sheet, Sandfire could earn an 80 per cent interest in Kalkaroo through a two-stage earn-in structure, comprising $105 million upfront consideration (70 per cent scrip and 30 per cent cash), and a further $105 million consideration after completion of the new PFS.
Havilah shareholders are expected to vote on the binding agreement by January 2026, with Sandfire targeting completion of the new PFS within 18 to 24 months of the deal’s approval.
Both companies said the collaboration combines Sandfire’s “proven mine design”, its project development and operating capabilities, with Havilah’s “deep geological knowledge” of the province to unlock the site’s potential.
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