Classification late in 2018 of Jericho as a new copper discovery prompted the joint venture participants to implement a new project funding model for Jericho related activities, whereby Minotaur’s share of costs shall be borne by OZ Minerals from April 2019.
Under a new structure, the Jericho Joint Venture, project interests were set at OZ Minerals 80% and Minotaur 20%, in return for which OZ Minerals now “loan carries” Minotaur through exploration, feasibility, project development and production, until Jericho achieves positive cash flow.
For illustrative purposes, the structure could alleviate Minotaur of its 20% component (or $50 million) of a project development total of, say, $250 million unless and until a commercial mining operation at Jericho eventuates. Minotaur’s loan facility attracts interest at the bank bill swap rate plus a 2% margin, currently about 3% (as at 1 August 2019).
OZ Minerals has appointed Minotaur as manager and operator of the joint venture. Objectives through to the end of 2019 include drill data compilation (some 7,500 mineralised drill intercepts) into a wire frame model and a preliminary block model for the centre sections of J1 and J2 lodes. Activities complementary to geological modelling will include baseline ecological studies, first-pass metallurgical testing and high level mining optimisations.