MARI - option secured for water supply & resource upgrade ..Hi all,
Some thoughts again,
B
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Hello,
Over the last couple of weeks we have once again had a number of significant news items from Marimaca Copper. I just wished to cover the two main news releases :
- Option secured for life-of-mine water supply - this important milestone for the Marimaca project was announced yesterday. For the full announcement click here. The importance of this announcement cannot be overemphasized - the ability for projects to access water for mining operations has become a critical issue for many in the industry. Social and environmental factors have moved the issue of water usage high up the political agenda in many jurisdictions. We saw this recently in the Chilean Constitutional vote, and it is a debate that will keep making headlines. Marimaca does have the comparative luxury of being able to use salt water for its operations, unlike many who require fresh water. However, with the restrictions around tapping fresh groundwater reserves only increasing, I believe many in the industry will attempt to retro-fit projects with salt water supplies. Getting ahead of this potential rush is vital, which makes today's announcement all the more timely.
- Significant upgrade to Mineral Resource - a few weeks ago the Company announced a large upgrade to the Mineral Resource of the Marimaca Project. For the full announcement click here. This resource included all the drilling data up until June this year, and was solely focused on the Marimaca Oxide Deposit (MOD). The total tonnes of ore in the MOD moved up from 116m tonnes, to 222m tonnes. Tonnes of contained copper metal moved from 644,000 tonnes, to 988,000 tonnes of contained metal. This resource upgrade firmly establishes the MOD as one of the largest copper discoveries globally in the last decade, and the project as one of the (if not THE) leading mid tier development assets in the industry.
Summary thoughts - Securing the water supply for the MOD is another big tick along the path to development. Furthermore, with this resource upgrade the MOD should now be looked at as a future 50,000 - 60,000 tonne annual copper producer, rather than the 36,000 tpa that was modelled in the PEA. It should also be highlighted that all the other standout attributes of the MOD remain : bottom quartile C1 cash costs, extremely low strip ratio, extremely low capex intensity, and all on existing infrastructure. I don't believe anyone doubts that the MOD is going to be a mine. The main understanding questions are now 1) What size will it be ?, and 2) Who will ultimately develop it ? As this cycle picks up steam (2023 the last year of surplus copper supply ?) It feels like those questions will be answered soon.
p.s. Bonus material - video interview with Hayden Locke, Marimaca CEO. Discussing investing in mining, the metals cycle, and Marimaca resource upgrade.
Click here for video.