The Ernest Henry Copper-Gold mine, the third largest copper deposit in Australia, is located 35 km NE of Cloncurry in the Mt Isa-Cloncurry mineral district of NW Queensland. Ernest Henry Mining Pty Ltd (EHM), a wholly owned subsidiary of Xstrata Copper Australia, operates the mine. Approximately 10.2 Mt of ore grading 1.12 per cent Cu and 0.56 g/t Au were processed during the 2001 - 2002 financial year. The Ernest Henry plant produces copper-gold concentrate, which is trucked to Mt Isa for smelting._x000D_
The Ernest Henry deposit is a member of the diverse Fe-oxide-(Cu-Au) class of deposits. The orebody is hosted within a sequence of moderately SSE-dipping, intensely altered Paleoproterozoic intermediate metavolcanic and metasedimentary rocks. Copper (chalcopyrite)-gold mineralisation occurs mainly within the magnetite-biotite-calcite_x000D_
pyrite matrix of a 250 m_x000D_
300 m pipe-like breccia body. The breccia pipe comprises two anastomosing lenses separated by a lower grade, clast-supported breccia zone. Several anastomosing brittle faults affect the macro-geometry of the orebody. Copper grade is proportional to the degree of matrix support in the breccia. The July 2002 Ore Reserve was 88.7 Mt @ 1.0 per cent Cu and 0.5 g/t Au._x000D_
Resource estimation at Ernest Henry is based on a large database of predominantly diamond drill hole information. Drill spacing is typically 50 m_x000D_
50 m. Ordinary kriging is used to estimate Cu, Au, SG and IST (oxidation indicator) into model parent cells of dimension 20 m E_x000D_
20 m N_x000D_
16 m RL. The block model is comprised of five geological-geochemical domains represented by 3D wireframe surfaces. Zonal control, where samples and blocks are assigned the same domain number, is used to control grade estimation. The geometry of the domains defines hard grade boundaries across strike and soft boundaries along strike A Deep Drilling Project was initiated in August 2002 with the initial aim of testing the down-plunge extension of the orebody to a vertical depth of over 1 km. The encouraging intersections to date have resulted in a significant increase in the mine's open pit Mineral Resource together with the identification of an underground Mineral Resource. Added benefits of the project included an expanded and updated geological legend and an improved understanding of the host geological sequence.