Queensland moves to future-proof resources sector
Falling coal prices prompt Queensland to accelerate shift into diversified resources
Explorers gain active support from Crisafulli Government as they look to bring projects into development
QMines and Zenith Minerals discuss how government backing is advancing their projects
As coal prices continue to fall, Queensland — Australia's top coal producing state — is looking to diversify by increasing its push into other resources, targeting faster project approvals and rapid development.
Closure of the Mt Isa copper smelter has been viewed as a major blow to Queensland's renowned Northwest Minerals Province and copper industry but the state's mining sector extends far beyond Mt Isa.
With active support from the Crisafulli Government, central Queensland explorers say their respective projects are progressing faster towards development.
This not only serves to fuel the state's economy but supports its transition to net zero, drives regional jobs and supercharges Queensland's critical minerals capability.
At the heart of the coal to copper transition
Copper explorer QMines (ASX:QML) is on its way to becoming a 10,000-20,000tpa copper equivalent producer at the Mt Chalmers copper-gold mine, with a pre-feasibility study last year indicating a 10.4-year project costing $191m with a 1.8-year payback and NPV of $373m.
Since listing in May 2021, QML has acquired two projects, as well as five rural properties, drilled at least 40,000m and delivered seven resource upgrades at Mt Chalmers about 90km from Rockhampton.
As part of its growth strategy, the company is working to double its planned production rate, focusing on the acquisition of regional deposits capable of supporting a centralised processing hub at Mt Chalmers, while also advancing exploration to expand and upgrade current resources and convert historical resources into reserves.
Speaking with Stockhead, QML managing director Andrew Sparke said QMines saw itself right at the centre of the transition to critical metals.
'I need to start by saying coal is a very important contributor to the State Government purses, we have a lot of great coal mines that generate a lot of value for Queenslanders and Australia,' he said.
'But there is a transition going on and it puts us in a very good position given we own the historical Mt Chalmers copper-gold mine but also considering the flurry of acquisitions we've done in the Central Queensland region over the last couple of years.
'We've bought the high-grade copper-zinc project at Devlin Creek, which settled in September last year, and we've just announced the acquisition of the Mount Mackenzie project, all in the central Queensland region,' he said.
'What that means is, over time, there will be more and more jobs coming online from these newer energy transition metals as the world diversifies its energy mix.
'I think it's a great hedge for the Queensland community that we have a lot of these new energy metals in Queensland which can pick up the slack in terms of jobs, royalty funds, and also in terms of the engineering and industry capabilities the state has.'
Speeding up the approvals process
According to Sparke, the new Queensland Government is making a concerted effort to improve regulatory efficiency by simplifying permitting, reducing delays and expediting the approvals process.
'There's a new program underway at the moment that waives tenement holding costs for a period of five years,' he said.
'There're also some collaborative grants for new exploration ideas where they'll co-fund drilling for explorers to make new discoveries in this space, so they're doing a lot and being very proactive in terms of trying to foster these new energy transition metals.
'It's nice to see that change of perspective, that mining is important to the prosperity of Queensland and Australia and we need to co-exist to create jobs which leads to a better standard of living.'
Support for Red Mountain drilling
Multi-commodity explorer Zenith Minerals (ASX:ZNC) owns the Red Mountain project in central Queensland's Auburn Arch, a region known for its rich mineral endowment.
Discovered by ZNC in 2017, the project presents significant gold and silver mineralisation, with associated copper and molybdenum at depth.
The mineralisation is hosted within a large breccia pipe system and shares similarities to other major gold deposits such as Mt Wright, Mt Leyshon and Mt Rawdon.
ZNC managing director Andrew Smith echoed QMines' view, noting that the world was undergoing a fourth industrial revolution marked by a shift from hydrocarbons to a renewable-based economy.
'Governments are recognising that the transition requires critical minerals and key elements such as such as copper and they're passing policies in Queensland and in the Federal Government to support these initiatives,' he said.
'What we're seeing on the ground is the pointy end of the stick, which is the recent grant that has enabled us to de-risk this project.'
Last month, the company secured a $275,000 Queensland Government grant under Round 9 of the Collaborative Exploration Initiative (CEI) - a state program designed to encourage discovery of critical minerals - to support deep diamond drilling at Red Mountain, highlighting the project's strategic position in the search for critical and precious minerals.
ZNC exploration manager Danny Greene said Queensland was quite unique in terms of the grant funding offered.
'Generally, with state funding, it's co-funded and is normally capped at 50% - the company pays 50% and the government pays 50% but in Queensland, they've gone the extra yard,' he said.
'They offer 100% of the funding and it's generally a bit more lenient on where you can allocate that funding as well, so they are super supportive in that regard.'
Upcoming drilling at the project in July is designed to unlock the project's primary gold mineralisation, while also tapping into the copper and molybdenum mineralisation at depth.
The company will target what it believes could be a significant gold system with copper and molybdenum as part of a potential broader porphyry-style, intrusion-related mineralising event.
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