It’s the perfect storm of opportunity.
With global demand for copper ramping-up once again, especially in China, Dunnedin Ventures (TSX.V: DVI) is finally poised to capitalize on its timely acquisition of three prospective company-maker porphyry copper-gold projects.
Led by a management team that has had considerable success in the discovery and development of world-class copper deposits, Dunnedin believes it is in the right place and at the right time -- especially because the Vancouver-based minerals explorer was able to purchase these key assets at virtual fire-sale prices during the depths of a prolonged mining slump.
Now this low-risk gamble is beginning to pay off, with the advent of an initial batch of impressive assay results from the company’s initial exploratory drill program at the MPD copper-gold project in south-central British Columbia (BC). (More on this in a moment.)
This very expansive 7,850-hectare project area sits at the heart of one of North America’s most prolific copper belts and in close proximity to several big-league copper-gold mines, namely Highland Valley, Copper Mountain and New Afton. Also, there exists excellent infrastructure in this mining camp, including a network of highways and roads that offer easy access to the MPD project area.
Even though several mineralized areas among Dunnedin’s land claims have already been drill-tested by past explorers, this is the first time ever that the large land package has ever been consolidated into one single contiguous property which boosts the odds of Dunnedin unearthing a district-scale, elephant-sized copper-gold deposit, much like the ones that this historic mining district is already renowned for.
Why Management is Key: Success Breeds Success
The company benefits from an accomplished management team consisting of individuals who have all distinguished themselves in their diverse, yet complimentary fields of expertise. For instance, Dunnedin’s founder and Chairman is Chris Taylor, whose star has been ascendant for the past couple of years as the CEO of high-flying Great Bear Resources.
To date, Great Bear’s share price has appreciated more than 2,000% since Taylor and his team began systematically unlocking the value of a prospectively massive, high-grade gold deposit at the Dixie Lake gold project in Red Lake, Ontario.
It was Taylor who cherry-picked Dunnedin’s new base metals projects. And he is no stranger to big copper finds. During his tenure with Imperial Metals, he was instrumental in the development of what became the world-class Red Chris copper-gold porphyry mine, which is also in BC. And he is now particularly enthused by the MPD project, which he says, “has flown under the radar for many years, but its location near infrastructure and year-round road accessibility demonstrate why this area is a leading copper production district in B.C.”
Working alongside Taylor is Dunnedin’s CEO Claudia Tornquist, who gained plenty of experience in the development of other world-class copper porphyry deposits while working as a senior executive with the multinational mining heavyweight Rio Tinto Group. These deposits include the world’s largest copper mine, the Escondida operation in Chile, as well as Rio Tinto’s majority-owned, world-class Oyu Tolgoi mine in Mongolia.
Hunting a Massive Copper-Gold Find in “Elephant Country”
In November, Dunnedin drilled 1,766 metres in three drill holes, which yielded impressive grades, such as 102 m of 0.68% copper equivalent (0.53% copper and 0.16 g/t gold).
Significantly, drilling encountered intervals of higher-grade copper-gold within a broad lower grade interval, while many of the copper grades improved at depth. Also, the mineralization was shown to run to a depth of at least 800 metres, and remains open at greater depths. For instance, drilling highlights include 763.6 metres of 0.28% of copper/gold equivalent (0.21% copper and 0.07 g/t gold) from 52.3 metres to 816.0 metres.
Examining copper-gold porphyry core at Dunnedin’s MPD project in BC.
Past drilling conducted at shallow depths by previous explorers suggests that a large porphyry system spans a significant portion of the property. All told, a total of 129 historic drill holes provided Dunnedin with a wealth of geological data points to inform its drilling plans. In fact, many of these original drill holes intersected grades that compare favourably with nearby operating mines. Now the latest drill results have bettered them in terms of grades.
Furthermore, there exist numerous untested geophysical and geochemical copper-gold anomalies on the property, some of which are in close proximity to historic discovery zones. Additionally, there are copper showings at surface across an expansive area of 10 square kilometres, suggesting the presence of plenty more lustrous drill targets.
What is also very noteworthy here is that these now-unified exploration fields reveal the full extent of a large mineralized system that has never been systematically explored before – and certainly not at depth. Starting this spring, Dunnedin expects to embark a follow-up exploratory drill program to better define the structural controls of this prospectively very expansive copper-gold mineralized system.
Claudia Tornquist, President of Dunnedin, sees MPD as being a prospectively very valuable asset going forward once her company starts to probe for its richest mineral concentrations.
She says, “What we are doing is advancing a known mineral discovery that is undervalued and has the geological characteristics that can drive rapid value growth for investors when modern exploration methods and management’s experience is applied.”
“Hence, “MPD is a quality project with immediate exploration upside and the potential to yield a major copper-gold porphyry system.”
Strength Through Diversification
Elsewhere, Dunnedin is creating a suitable environment for year-round news flow with its acquisition of the Mohave copper-molybdenum-silver porphyry project in Mohave County, Arizona.
According to a 2019 Dunnedin news release: “Mohave has the potential to host a large-scale copper porphyry deposit with silver and molybdenum credits. Its geology is considered analogous to Freeport McMoran’s Bagdad copper porphyry mine which is located approximately 33 kilometres to the east of Mohave.”
The final hard rock asset in Dunnedin’s portfolio that is expected to see active news flow this year is the advanced-stage Trapper copper-gold porphyry project in northern BC. It spans 3,756 hectares in the richly-mineralized Golden Triangle and has significant size potential, as well as plenty of historic drill holes to guide further exploration work. Highlights of a 2011 drill program undertaken by a previous project operator intersected grades as high as 1.71 g/t of gold over 34.1 metres.
Accordingly, Dunnedin may yet invite the participation of a major mining company to fully explore this property’s potential to become a sizeable, high-grade copper-gold deposit. This will allow Dunnedin to offset exploration costs to a third party that will have to “earn-in” on its ownership of any emerging discovery.
Prepping for drilling the Prime zone at MPD
Investment Summary
In summary, Dunnedin’s strong management, including its geological advisors, has considerable technical expertise and an exceptional track record of value creation for investors.
Additionally, Dunnedin’s near-term focus on the MPD Project is already yielding encouraging results in an under-explored copper-gold belt – and at low project entry costs, as well as cost-efficient exploration expenses.
All told, Dunnedin offers investors leveraged exposure to three potential company-maker projects at a ground-level entry point. And even though Dunnedin is best known for being a diamond explorer, mining investment commentators agree that the company’s re-boot is a positive value driver in a revitalized market for both gold and copper prices.
Tornquist concurs that Dunnedin is on a new pathway to exploration success. And she is encouraged that her company will succeed in building significant intrinsic value into its share price via the drill bit in 2020.
She adds, “As we have witnessed in 2019, exploration companies have been rewarded handsomely in the capital markets for copper-gold discoveries. Other copper exploration companies in British Columbia, such as GT Gold, have generated significant increases in shareholder value through deeper drill testing of porphyry targets. Hopefully, 2020 will be our year to shine.”
ABOUT THE AUTHOR: Marc Davis has a deep background in the capital markets spanning 30 years, having mostly worked as an analyst and stock market commentator. He is also a longstanding financial journalist. Over the years, his articles have also appeared in dozens of digital publications worldwide. They include USA Today, CBS Money Watch, The Times (UK), Investors’ Business Daily, the Financial Post, Reuters, National Post, Google News, Barron’s, China Daily, Huffington Post, AOL, City A.M. (London), Bloomberg, WallStreetOnline.de (Germany) and the Independent (UK). He has also appeared in business interviews on the BBC, CBC, and SKY TV.
FULL DISCLOSURE: Dunnedin Ventures is a paid client of Stockhouse Publishing.