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Cashing in on Copper Assets in Peru

Dave Jackson Dave Jackson, Stockhouse
3 Comments| March 11, 2021

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Copper is one of the most essential materials in our everyday life, and copper scrap material represents a strategic source of the crucial base metal. Brought on by the explosion in the merging Electric Vehicle market, electrification of emerging economies, transportation equipment, and home appliances…copper is one of earth’s most vital metals.

Leading the charge in copper exploration in South America is Element 29 Resources Inc. (TSX-V.ECU, Forum) – an advanced copper explorer focused on advancing a portfolio of Peruvian projects – including its flagship copper porphyry Flor de Cobre project located in southern Peru and its Elida porphyry copper-molybdenum-silver project located in central Peru.

Stockhouse Media’s Dave Jackson was joined by company President, CEO & Director Brian Booth – who brings more than 30 years of experience in mineral exploration throughout Canada, Europe, southeast Asia, and in Peru – to discuss ­ Element 29’s copper exploration business model, it’s two-pack of mining projects in Peru, and a variety of timely and newsworthy topics about this intriguing company.

TRANSCRIPT BELOW:

SH: So first off, for Stockhouse our metals & mining investor audience new to Element 29 Resources, can you tell us a little bit about yourself and the company?

BB: Well, first of all, I've been a career, mining exploration executive. I started my career with Inco Limited after 23 years of moving around in different levels within the exploration management and then went out and started my, my own companies started with Lake Shore Gold, which was a tremendous success and produces over 200,000 ounces per year now. And then moved on to become the chair of Claude Resources, which was sold to SSR Mining in 2016 and I'm still on the SSR Mining board. And now I'm, you know, I've been working in Peru for the last 10 years in copper exploration and founded porphyry there with my team that we brought through engineering studies. And now I'm going to try to do the same things with E29 as we advance our two new copper projects going forward. These excited me when I first joined the company because they're not grassroots projects, there have great infrastructure, and there's a great opportunity to take these very rapidly through de-risking engineering and metallurgical studies.

SH: For our Stockhouse investor audience that might not be too familiar with mining operations in Peru, can you give us a brief overview of the jurisdiction?

BB: Peru is a tremendous jurisdiction, especially for the base metals and gold, but particularly copper - it's the second largest producer of copper in the world. So the government knows that mining is very important to the country's economy. And so they they've been very supportive of, of mining ventures in the country and worked very well with the companies there to advance the project. So we're very excited to be in this jurisdiction and, and think we have a great opportunity to go forward.

SH: The company has the two key Peruvian projects that I briefly mentioned in the intro. Can you briefly walk us through them?

BB: Sure, our first project is called Flor de Cobre, and it's located in the copper belt that comes up from Chile into the southern part of Peru. So it's well located between two mines. The largest mine is Cerro Verde which is owned by Freeport. And the second is Chapi, which is owned by Nexa. And so we're right on trend with those two mines. So we're in the right areas to find additional mineralization to the mineralization that we already have. And we'll be doing that this year and over the next couple of years, advancing those projects very rapidly and because we're in a mining belt. The infrastructure is there where there's power water and low elevation and close to the coast, all of those things we benefit from as we start to de-risk the projects. Our second project, as you mentioned, is Elida in central Peru, it's located about four hours drive north of Lima. And again, very well located only an hour's drive on a very good road off from the coast. And again water, low elevation power opportunities and good infrastructure is, is a benefit to that project. And it's a very large porphyry system, newly discovered. And so both these projects are projects that are new to the market and you know, we're hoping that we'll be able to advance them fairly rapidly.


SH: Brian, what kind of operational work has been done to date and what makes the two properties so appealing compared to other copper projects?

BB: You know, in comparison to some others, first of all, we have two excellent opportunities to move these forward and de-risk them. But we benefit from Flor de Cobre, there is a historic resource on the property that was drilled 30 years ago when the copper price was around a dollar. Today 60 million tonnes of 0.6% - 0.7% copper is very important and it's all above 200 meters from surface. And it's something that a junior mining company can finance and develop. So we're going to be focusing on, on de-risking with all the studies to do that. And that at Elida it's a very large system. We're going to be drilling five different porphyry centers there. Only one has been tested and that's the benefit we have. There's 18 holes already drilled. We're just going to tighten up that drilling, and then we'll be able to come out with our maiden resource this year. So again, these are advanced projects, they're not grassroots and very rapidly from the existing work that's already been done, which is plus 10 million, probably $15 million plus of work we're benefiting from. So we know where the mineralization is. It's really getting it all quantified and understanding how it behaves so that we can move it forward to through different engineers.

SH: Can you tell our investor audience how far along these projects are in terms of exploration and development, including the approval of permitting and licenses from the Peruvian government?

BB: The focus this year in the next few months is to, is to get our permits finalized. We've submitted both of our permits for both projects last year. They're in the final stages of being reviewed by the government. So we anticipate we'll get those very shortly that will allow us to take to at Flor de Cobre to drill in and around the historic resource and modernize that and get some good core that we'll be able to start doing metallurgical recovery studies, et cetera, as we move that forward. In addition, there's a lot of brownfields exploration around that to add to that resource. So we're looking forward to increasing the drilling there to hopefully expand on, on the mineralization that's already there. At Elida, when we get that permit will be going in and tightening up the drilling that already was done in 2015. So it's very modern drilling. We have all the core. So we'll be just tightening that up. So it meets the criteria of an, of an inferred resource and that will lead to our maiden resource toward the, towards the end of the year, which from our technical report, we're targeting something at about a half a billion tonnes from one target and where there's still four other porphyry centers yet to be tested in that system. So very exciting opportunity for growth.

SH: What local community support do you have and what work plans are in place for each in 2021?

BB: Well, that's a very good question because you know, this is important in today's world. Social license is everything in the mining business today. We spend a lot of time and effort meeting with our community at Elida, which is called the ACO community. We have an agreement in place that we just renewed for another five years. So we've had a great relationship with them, and we will always maintain that relationship with them. They get involved in our projects and our good stakeholders with us. And so we, you know, we really make an attempt to get that done, right. And the Flor de Cobre case there is a community on half of the project, and we are already engaged with them to finalize the agreement there. But on the other half where we'll be drilling year, it's owned by the government and one of the mining companies nearby the surface rights. So we're already at advanced stages there and dealing with the government and that company in terms of getting access to the surface. So again, just a slightly different stakeholder, but certainly very important to us. And we've already done a lot of work on those areas to make sure that our drilling gets done properly.

SH: The company boasts a tight share structure along with a strong and diverse shareholder base – institutional, retail, and private equity. Tell us more about your shareholders?

BB: Our largest shareholder is Globetrotter Resources, which was the project generator company that we spun these two projects out of. They'd been working in Peru for over eight years and brought these projects to where they are and then needed a team to come in to, to take ownership of those and then take them forward. So they're our largest shareholder. And then the other shareholder is Resource Capital Funds (“RCF”), which is private equity, which supplied the financing to go public and, and start to get our work underway after we finished the IPO. And then in addition to that you know, management and the board own about the same as the private equity. So those are, those are our big shareholders right now.

SH: Can you tell our audience about your management team, along with their experience that they bring to Element 29?

BB: Well, in addition to myself, which I already told you about we have a very good team below me. Our CFO Duane Lo has been an experienced CFO in Peru. He worked for First Quantum as their controller, so he understands the system there and the taxation and even, you know, they brought them onto the stock exchange there. In addition to Duane lo we have Paul Johnson who just joined the company, Paul Johnson is a PhD porphyry expert. He was a, he worked for Teck for years in South America. So, and he knows these projects very well. So he's a key individual to move those projects forward technically, and so very strong team to start the company and our team on the ground there. Today with travel restrictions, it's not going to be easy for Canadians to go there. We have a General Manager, Manuel Montoya, another Teck alumni who is our general manager and will focus all of the field work there as we get started soon.

SH: And finally, Brian, what can investors expect from the company in 2021 and moving forward?

BB: As we get our permits, we'll then initiate all the drilling. And so there'll be drill results coming forward as news flow over the next six months. And then after that, once the drilling is completed, we will be building the, the block model for Elida and coming up with that maiden resource towards the end of this year. And then the Flor de Cobre will probably follow the first quarter of 2022. We'll also be initiating some engineering work on, on both projects – metallurgy at Elida and probably the same at Flor de Cobre into 2022.


To find out more, visit www.e29copper.com



FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.


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Comments

QCCU QC COPPER AND GOLD - FORMER FALCONBRIDGE COPPER MINE
(28)
March 13, 2021

can i see others
(0)
March 11, 2021

nice see others
(0)
March 11, 2021

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