Mining investors hear the same refrain these days, no matter what metals sector in which they choose to invest. The best deposits have already been discovered and (in many cases) already mined to depletion. The junior exploration companies – mostly Canadian – who locate and develop these ore deposits must look in ever more remote locations, or deeper and deeper into the Earth’s crust.
Where robust mineral deposits do exist, typically they are in unstable regimes, or simply in poorer jurisdictions which lack any infrastructure or expertise to support mining operations. However, not all of the most prospective jurisdictions have had their mineral wealth exploited.
One mining company, Carube Copper Corp. (TSX: V.CUC, OTCQB: CARCF, Forum), is focusing its operations on Jamaica. Jamaica? This is a jurisdiction which has not even been on the radar of most mining investors – or most mining companies. However, Jamaica has a thriving mining industry. In fact, it was the first Caribbean jurisdiction to have any mining operations.
Today, bauxite is the major metal in Jamaican mining. At one time, Jamaica was the world’s second largest producer of bauxite, attracting household names like Alcan and Alcoa. In 2017; Jamaica is now the world’s sixth largest producer of bauxite, as other bauxite-producing nations like Australia have dramatically ramped up their production.
Not only is Jamaica an established, mining-friendly jurisdiction, it is part of the British Commonwealth. As such, it is governed by British law. This means more legal certainty, particularly with respect to property rights, than in most other Caribbean jurisdictions. It also has abundant mining infrastructure based on its bauxite/alumina industry.
Carube Copper is in Jamaica not to find bauxite but rather (as its name implies) to find copper. Jamaica has some previous history of copper mining. As early as the 1820’s; small amounts of copper were mined and shipped from Jamaica: high grade, near-surface mineralization which required little processing.
In the 21st century, this is not how the world gets its copper. The vast majority of the world’s copper comes to us via bulk-tonnage deposits, with the most robust of these deposits being copper porphyry formations. Often these are open-pit mining operations.
Copper porphyry deposits are typically lower grade, but with a massive tonnage of mineralization. Of equal importance, mineralization is generally continuous, in long, thick layers. This potential was what drew Carube Copper to Jamaica.
As a project generator, the Company’s management became aware of the prospective opportunity of Jamaica through working with two veteran geologists with knowledge and experience in that jurisdiction: Chris Gleason and Bob Garrett. While Gleason has since passed away, Garrett continues to work with the management team.
This Canadian understanding of the mining potential of Jamaica came in large part from the involvement of CIDA, the Canadian International Development Agency. Officially a foreign aid entity, CIDA also helped to open doors for Canadian companies looking to expand abroad. It has since been merged into the Department of Foreign Affairs.
Carube became a first mover in Jamaica in non-bauxite related mining, giving it the opportunity to stake claim to the best mining licenses. Understanding the potential of Jamaica for copper mining requires looking at the bigger picture.
Geology is both a macro and a micro science. Geologists must be able to decipher mineralization trends in the immediate locations in which they explore. However, identifying prospective locations for mineral exploration requires first obtaining an understanding of massive geological plate formations.
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The dominant geological formation in the Caribbean is, not surprisingly, the Caribbean plate. What often occurs in geology is that the most lucrative mineral deposits occur around the boundaries of geological plates. It is through joints and fissures in these geological plates that higher concentrations of metals flow towards the surface from the magma deeper within the Earth’s crust. And so we see several major copper deposits around the fringes of this plate.
Carube has seven land packages in Jamaica, comprised of 11 mining licenses which span 536 km2 of surface area. When the Company completed its magnetic imaging and soil sampling, its most difficult decision was where to start drilling.
With a market cap of under $10 million, CUC sought out larger partners to help it develop its large holdings via joint venture. The Company made a deal with OZ Minerals, a mid-tier copper miner based in Australia with a market cap approaching $2 billion.
OZ invested a total of $14 million in exploration on some of Carube’s licenses, primarily its Bellas Gate Project. Bellas Gate offered the greatest number of higher priority targets out of the seven land packages. OZ’s drilling at Bellas gate focused on the Connors zone.
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In the summer of 2014; OZ began drilling at Connors. Assay results at Connors indicated long intercepts of significant mineralization in several of the holes, including 260 meters of 0.44% copper and 0.19 g/t gold (open at depth), as well as 297 meters of 0.40% copper and 0.24 g/t gold.
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While OZ Minerals focused its drilling activities on the Connors zone, it also drilled a few exploratory holes in several other zones at Bellas Gate, including a very long intercept in the Provost zone. The assay result indicated an intersection of 339.15 meters grading at 0.28% copper and 0.12 g/t gold, with mineralization open at depth.
Despite this encouraging result, OZ’s management decided not to continue with the joint venture. Copper porphyry deposits generally occur in a single, massive geological system. Along with other geological data, OZ’s drill results indicated that the Bellas Gate land package was likely the host of several, smaller copper porphyry systems.
While the individual porphyries are not large enough to support commercial mining, in combination the cluster offers potential for a massive tonnage deposit, at grades which would permit profitable development. The problem for OZ Minerals is that with (at the time) a market cap of $1 billion, Bellas Gate had become too big for it to develop a mining complex of this nature on its own.
On September 21, 2016; Carube re-acquired OZ Minerals’ interests on Bellas Gate as well as five other licenses for which it had obtained exploration rights. OZ retained a 2% NSR on Bellas Gate and a 1% NSR on the other licenses. For Carube (and its shareholders) this meant that the Company once again held 100% ownership of the Jamaica licenses but with the benefit of the $14 million invested by OZ.
With OZ Minerals no longer in the picture, Carube’s management team reassumed the lead role in developing this project. While the geological model had changed, the Company still strongly believed in the economic potential of the project.
Supporting management’s belief in that potential is a real-world example of a copper porphyry cluster which is being commercially mined: the Northparkes Cluster in New South Wales, Australia. Grades at Northparkes are comparable to some of the better holes from Bellas Gate. The system of porphyry clusters and the mining operations connected to them was deemed to be worth $820 million (USD) when Rio Tinto sold an 80% interest to China Molybdenum.
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While Bellas Gate is the Company’s principal focus, management is eager to test other high priority targets with its 2017 drill campaign. After concluding a recent private placement, CUC is fully funded for its upcoming drilling, estimated at approximately 2,500 meters.
The highest priority targets were already denoted in a previous graphic. At the top of the list is Provost. Only a single hole was previously drilled by OZ Minerals, but the result was certainly sufficient to warrant further exploration.
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Other high-priority targets which may be included in the next round of drilling are the Hendley zone, Provost SE, and Connors SE. Management plans to drill the first hole of this program at Provost and if results are encouraging, it will drill at least one additional hole in that zone. The Company also intends to test at least a couple of the other most prospective zones.
CUC is also interested in the gold potential of its Jamaican licenses. In addition to the low-grade gold mineralization identified in the larger zones of copper mineralization, high-grade gold has also been found in Jamaica within the Company’s Main Ridge Project, adjacent to the historic Pennants Gold Mine.
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Carube’s management and board are stacked with mining veterans with an abundance of geological expertise. Jeffrey Ackert is CUC’s President and CEO. In addition to his geology degree, Ackert has over 30 years of mining experience in mineral exploration and management.
Vern Rampton is VP of Corporate Development. An engineer by training (PhD), Rampton has more than 35 years of experience in exploration, development, and corporate management. He previously served as President and CEO of Kinbauri Gold Corp from 1984 until its takeover in 2009.
The Company’s Chairman is Alar Soever. In addition to more than three decades of mining expertise, Soever is Executive Chairman of Wallbridge Mining.
Wallbridge Mining originally became involved with Carube Copper as a by-product of the Company’s RTO with Miocene Metals. Wallbridge Mining was a large strategic investor with Miocene. When the two companies merged, Wallbridge became a major shareholder of CUC with Soever providing leadership at the Board level. Wallbridge currently holds roughly 13% of CUC’s outstanding shares.
This leads to the Company’s legacy assets. As part of the merger with Miocene Metals, CUC acquired title to Miocene’s trio of British Columbia exploration properties. Miocene’s management team had also been building its land holdings in relation to a larger geological formation.
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In the Pacific Northwest, the Cascade Magmatic Arc extends in a broad curve through central British Columbia down through Washington State. As with the Caribbean Plate, several significant copper-gold discoveries have already been identified along this trend. Management is looking for a JV partner to help unlock the shareholder value in these prospective properties.
As a project generator, Carube Copper ultimately may not establish a copper project in Jamaica on the same scale as Northparke’s $820 million (USD) copper porphyry cluster. However, as a junior mining company with a market cap of less than $10 million, it doesn’t require a lot of value-added in its exploration activities to boost that market cap to multiples of its present level.
Jamaica is a tourist destination well known for its blue sky and sandy beaches. Carube Copper and its investors are also coming to Jamaica for blue sky – in the form of Jamaica’s copper-gold porphyry potential.
www.carubecopper.com/
FULL DISCLOSURE: Carube Copper Corp. is a paid client of Stockhouse Publishing.