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Argonaut, Aeris at odds as drilling halted at Torrens copper JV

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Argonaut, Aeris at odds as drilling halted at Torrens copper JV

Argonaut Resources NL, the 30% joint venture partner in the Torrens copper project in South Australia, accused 70% owner Aeris Resources Ltd. of botching the program after the latter decided to pause drilling.

Aeris said May 29 that its unit Straits Resources (Australia) Pty. Ltd. paused operations after drilling of two holes at Torrens to review the geological information collected from the current drill program and the recently finalized geophysical interpretation work.

"Based on the new information collected the review work will focus on re-evaluating and refining geological target areas for future drilling campaigns," Aeris wrote.

Argonaut Director and CEO Lindsay Owler said that Straits failed to complete the agreed drilling program of 8 to 10 holes and used about 120% of the budget to test 20% to 25% of the initial targets.

"By any metric this outcome is unsatisfactory," Owler said in a same day release, adding that the "drilling program under the management of Straits has gone poorly."

Owler noted that Straits failed to take any material action over previous complaints by Argonaut unit Kelaray Pty. Ltd. as well as "exasperated contractors" that the "drill operations were disorganized and lacked project management."

Kelaray has asked Straits to hand over management of the joint venture, adding that the agreement between the companies does not allow any one company to discontinue an approved program of works.

"Kelaray has sought advice and will take appropriate action to remedy the current situation if arrangements to continue drilling cannot be agreed by the parties," Owler said.

The Argonaut unit also rejected Straits' claim that more desk-based geological and geophysical work is required in order to proceed, saying that further drilling is needed to explain the geophysical anomalies.

In response, Aeris Executive Chairman Andre Labuschagne defended the unit's operations, saying that the team managed the drilling program very well "in what has been at times difficult and challenging conditions."

Labuschagne noted that the decision to pause drilling is "in line with what all responsible and experienced managers of a drill program would be expected to do."