Marimaca Copper Corp T.MARI

Marimaca Copper - further drill results. Resource is getting

[Brecknock]

Been a little while, but from the same contact. 
Good luck all
B
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Hello, 

 

Over the past couple of weeks we have had two news releases from Marimaca Copper. Both announcements highlighted the continuation of strong drill results from the Marimaca Oxide Deposit (MOD). The first announcement was on May 10th (full release Click Here), and the second was on May 19th (full release Click Here).

 

Very quick thoughts :

 

• The news - Each news release had several standout results, including 420m at 0.54% CuT from surface (May 19th), and 144m at 0.70% CuT from 4m (May 10th). This current drill campaign serves two purposes - 1) to infill the current mineral resource. i.e. to increase the drill density and data-set for the current resource, so to upgrade its quality. And 2) to expand the overall size of the deposit. These two news releases clearly show that strong progress is being made on both fronts..

• What does it mean ? - I believe it means that the Marimaca deposit will increase in resource quality, and become meaningfully bigger. We have been told to expect a new resource study for the MOD and surrounding areas in Q3. At present the mineral resource stands at 113m tonnes of ore at a grade of 0.57% CuT, for 645,000 tonnes of contained copper. I believe there is a good chance the upgraded resource could approach 200m tonnes of ore, with possibly +850,000 tonnes of contained copper.

• Current markets - We are obviously seeing a correction in the global markets. As we've seen before, this inevitably has a negative effect on many junior and illiquid sectors. However, it is worth noting how strongly the copper price has performed (remaining well above US$4/lb), and how copper supplies continue to be constrained (the vast majority of mining majors continue to report declining copper production quarter on quarter).

 

Summary - I am increasingly confident that the Marimaca deposit will meaningfully increase in size. My expectation is this will support a larger mine (approaching 50,000 of copper pa?), and a longer mine life (+12 years?). Marimaca's other main attributes remain the same - a very simple to build mine, stable jurisdiction, with a low capex intensity, high economic returns (as of last study, using US$4 Cu, post tax NPV8 C$1.09 bn, post tax IRR 46%. NPV +C$12 / share). The metals cycle remains strong, and this is a rare and valuable asset.

[Woodman601]

[/.        quote] “MAR-19 extended intersected 420m at 0.54% CuT from surface, including the new re-entry intersection of 120m of 0.50% CuT from 300” I think it’s important to note that 420 meters is as deep as that drill could go. The ore could continue well below 

[Hiezenberg]

Good analysis and review... as always. Thanks for sharing. I would like to emphasize the politically favourable environment, especially in light of the recent news regarding the exclusion of major mining reform from the new constitution currently being drafted  ( to be voted on in September). 

[CG2021]

@200mt 850k contained copper where do you see the NPV SHARE price ? 

[Brecknock]

Good question. I don't have a fully built model yet. But I see potentially both the mine life and scale of production increasing by 30%. Could be more. And as location is simple the additional capex would be modular. So in simple terms I would expect to also see the NPV move up a similar amount, with the IRR staying roughly static.  Again, it could be more than this. But this is my base