“With the strong copper price, we are highly optimistic for the coming months. We are well funded to carry on our development of the Haib Copper project.”
Pierre Leveille, President & CEO
When Stockhouse Editorial last caught up with Namibian copper explorer
Deep-South Resources Inc. (DSM) (
TSX-V.DSM, Frankfurt: DSD,
OTCQB: DSMTF,
Forum) last
December, the company’s Preliminary Economic Assessment (PEA) at the time had just returned “significantly improved” economics. Or in other words, DSM was riding the wave of sharply increasing copper prices and delivering a copper recovery of an astounding 80% at its high-grade Haib Copper project in southwest Africa. And the company has been busy, and on the rise, ever since.
Copper prices are soaring, increasing more than 11% during Q1 2021 alone, as prices climbed to record highs (USD$4.75 per pound) for the first time in more than a decade on May 7
th, fueled by wagers on a U.S.-led global economic rebound that would boost demand for metals used in manufacturing and construction.
(Click image to enlarge)
And as demand expectations flourish on the back of the economic recovery from COVID-19, interest in the future of renewable energy and electric vehicles (EVs) will continue to soar. And copper is a big part of not just the rapid growth in EVs, but the New Green Economy in general.
Now, Deep-South Resources has
just released its latest high-grade copper intersects at Haib and the results are “significant”, to say the least.
In the News: Significant Copper and Molybdenum Intersections at Haib Copper Project
Deep-South has just released the first assay results from its current drilling program at its Haib Copper project in southern Namibia. And the significant copper and molybdenum intersections include:
- Hole HM06: 0.47% CuEq over 152 metres, including 30 metres at 0.81% CuEq
- Hole HM07: 0.42% CuEq over 128 metres, including 14 metres at 0.57% CuEq
- Hole HM10: 0.65% CuEq over 36 metres, including 12 metres at 1.04% CuEq
A more detailed account of the first five holes, for which assay results have been received, cover some 800-plus metres, and were drilled on central mineralised portion of the deposit to better delineate the extension of this zone to other mineralised areas located to the northwest and southwest.
The holes have successfully encountered intercepts of mineralization from bedrock or near bedrock surface. Comprehensive assay results for the holes are tabulated below:
| Significant Cu Intersections |
|
|
|
|
|
|
|
|
| Hole# |
Zone |
From (m) |
To (m) |
Width (m) 1 |
CuEq (%) 2 |
Cu (%) |
Mo (%) |
| HM01 |
Main |
28,00 |
34,00 |
6,00 |
0,38 |
0,38 |
0,001 |
| HM06 |
Main |
0,00 |
152,34 |
152,34 |
0,47 |
0,45 |
0,006 |
| Including |
4,00 |
42,00 |
38,00 |
0,66 |
0,64 |
0,005 |
| Including |
54,00 |
84,00 |
30,00 |
0,81 |
0,79 |
0,007 |
| HM07 |
Main |
32,00 |
160,00 |
128,00 |
0,42 |
0,38 |
0,011 |
| Including |
38,00 |
52,00 |
14,00 |
0,57 |
0,53 |
0,011 |
| Including |
92,00 |
104,00 |
12,00 |
0,49 |
0,43 |
0,019 |
| Including |
136,00 |
152,00 |
16,00 |
0,53 |
0,49 |
0,012 |
| HM08 |
Main |
10,00 |
28,00 |
18,00 |
0,26 |
0,22 |
0,011 |
| Main |
44,00 |
94,00 |
50,00 |
0,59 |
0,53 |
0,017 |
| Including |
48,00 |
64,00 |
16,00 |
0,88 |
0,84 |
0,012 |
| HM10 |
Main |
66,00 |
102,00 |
36,00 |
0,65 |
0,60 |
0,016 |
| Including |
68,00 |
80,00 |
12,00 |
1,04 |
0,90 |
0,043 |
| Including |
82,00 |
86,00 |
4,00 |
0,72 |
0,72 |
0,001 |
| Main |
114,00 |
120,00 |
6,00 |
0,46 |
0,45 |
0,002 |
Deep-South’s President & CEO, Pierre Leveille, commented:
“We are extremely enthusiastic by the first results from our active drill program. Previous drilling programmes point to the presence of higher grade zones of Cu, probably associated with near vertical structures within the broader mineralised areas of the project. The use of vertical drilling in the past potentially missed those structures during those programs resulting in an underestimation of overall grade. This current drilling program is looking to redress this through the use of inclined holes to identify and delineate these structures and test the association with higher Cu grade zones. These first results seem to support this updated interpretation, showing substantial intersections at Cu grades considered high for Haib. Additionally the presence of molybdenum has been confirmed with high Mo grades obtained in association with structures and alterations. Furthermore, three holes have expanded the size of Pit 2 in the higher-grade area.”
Investment Highlights:
As per the stock chart below, DSM’s valuation has appreciated considerably over the past year. Retail, institutional, and
private equity investors have taken note, increasing shareholder valuation by an astonishing 600% and pushing the company’s market cap to nearly $35 million at press time.
(12 month TSX-V.DSM stock chart May 2020 – May 2021. Click image to link to chart)
Why Deep-South?: Haib Copper Project
- Large Porphyry deposit with significant drilling (66,000 m mainly by Rio Tinto, Falconbridge, Teck and Deep -South since the 1970’s: work valued at US $ 35 million)
- Deposit contains over 5B lbs of copper (indicated and inferred)
- Preliminary Economic assessment (PEA) demonstrates robust economics
- 20 Mtpa throughput @80% copper recovery – US $ 3.50 per lb copper
- After-tax NPV US $1.3 billion
- After-tax IRR: 36%
- Capex: US $341 million
- Deposit is open at depth and at surface, five satellites of the main deposit targeted for resource expansion
- Highly experienced management team – track record of building and operating tier one projects in Africa
- Deep-South trades at 0.6% of the NPV after tax
- Peers trade between 3% and 5%of NPV after tax.
The Bottom Line
Mining analysts say the long-term outlook for copper looks extremely positive. Supply remains relatively constrained because of disruptions in countries such as Indonesia and Chile, while many expect demand to increase as more consumers transition to using EVs along with an upswing in the electrification of developing nations.
There are few copper investment opportunities that appear to offer the value that Deep-South Resources does. Investors would be well advised to keep this high-quality equity play on their investment calendar for the foreseeable future.
For more information visit
www.deepsouthresources.com.
FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.