Kincora Copper (ASX:KCC)
Following an externally-led review of its Mongolian assets, Kincora Copper (ASX:KCC) has received an ‘attractive’ offer with a non-refundable deposit for its Southern Gobi Belt portfolio. As the company irons out the details of the deal, President and CEO Sam Spring says the move complements the consolidation of Kincora’s New South Wales assets and may be the catalyst to finalise conversations with potential asset-level partners.
Kincora Copper (ASX:KCC) has completed an externally led strategic review of its Mongolian project portfolio that was launched in June 2023 after receiving several ‘confidential and incomplete’ offers.
Having pivoted its focus to New South Wales in 2019/2020, Kincora has concluded the review and is fielding an offer that includes the receipt of a non-refundable deposit to enable final due diligence and definitive legal agreements.
Kincora says the unsolicited offer for its wholly owned Mongolian porphyry projects and subsidiaries ‘contemplates a part cash, part scrip divestment with share consideration providing an upside on exploration success from a planned 2024 drilling program’.
After receiving the initial unsolicited enquiries, Kincora appointed Cerberus Advisory to assist with the strategic review.
In a management’s discussion and analysis report released today (15 November 2023) for the 9-month period to 30 September, Kincora updates the market on the potential divestment, as well as progress that has been made across its entire portfolio.
Its portfolio includes district-scale landholdings and scaleable drill-ready targets in both Australia and Mongolia’s leading porphyry belts, the Macquarie Arc and Southern Gobi respectively.
During and subsequent to quarter-end, the company concluded 2023 field season activities in Mongolia, which focused on advancing targets at the Bronze Fox, Tourmaline Hills, and Shuteen North intrusive complexes at the Bronze Fox project.
Kincora Copper President and Chief Executive Officer (CEO) Sam Spring and Chairman Cameron McRae both expect to shortly announce a ‘favourable’ conclusion to its strategic review.
Following conflicting rulings in the lower levels of the Mongolian courts relating to a tax dispute with the Mongolian Tax Authority (MTA), involving a prior tax assessment and payment in 2016 that was relied upon to close a merger transaction, Kincora’s appeal to the Supreme Court was accepted and its case heard in May 2023.
The Supreme Court referred the dispute back to the first level of the Mongolian judicial system with a review ongoing of the reassessment by a panel of independent experts.
In March this year, Kincora noted that its subsidiary Golden Grouse IBEX LLC (GGI) began preparing to appeal to the Mongolian Supreme Court to continue the defend against a 2021 retrospective tax assessment.
In January 2021, Golden Grouse received a retrospective Tax Act for 2.7 billion MNT, about US$800,000 from the Mongolian Tax Authority (MTA).
The Reassessed Tax Act is comprised of 4 items, of which Kincora strongly refutes the merits of 3 including the very vast majority of the liability sought relating to the 2016 merger with IBEX (the agreed liability owed is less than the deposit lodged by Kincora to pursue the ongoing Mongolian legal defence process).
Kincora says the Reassessed Tax Act is contrary to 4 independent Mongolian expert legal opinions, including those of new potential investors and they’re due diligence processes, as well as a recent Mongolian judicial precedent regarding the tax treatment of a merger transaction.
Kincora has sought to defend its position and the original 2016 tax act relied upon.
Meanwhile, the company today reports that now the strategic review is complete, it can start streamlining its focus towards its core New South Wales project portfolio.
As of 30 September, Kincora had about $2.2 million in working capital and just over $2 million cash at hand. During the preceding 9-month period, the company also received a $127,850 NSW government grant.
During the past quarter Kincora executed an agreement and received shareholder approvals to acquire RareX’s carried 35% asset level interests in the Trundle, Fairholme, Jemalong, Cundumbul, and Condobolin licenses. This now sees the company secure a 100% ownership across the projects it has exposure to in News South Wales.
The conclusion of the transaction will enable Kincora to bring in potential asset partners. Kincora notes all projects have designed drilling programs offering ‘company-making’ upside supported by strong technical merits.
Kincora meanwhile has also completed maiden drilling programs at the Condobolin and Nevertire projects, which tested new geological concepts at existing ‘high-grade’ and shallow gold-base metal targets at the Meritilga, Phoenix, and Tilga prospects.
Post quarter-end, as previously announced, the company was notified by its exploration alliance partner, Earth AI, of plans to begin drilling up to three 600m deep holes in the current quarter at Cundumbul. The program is testing anomalous copper geochemistry associated with outcropping hydrothermal breccias and skarns.
Cundumbul is located in the central Molong volcanic belt of the Macquarie Arc, some 30km south of Alkane’s Boda-Kaiser porphyry project.
An expansive operational update of Kincora’s work over the past 9 months is also reported in today’s announcement.
Write to Adam Orlando at Mining.com.au
Images: Kincora Copper
Australia, Chile, Mexico, Peru, and the US are vastly different countries but have one common element amongst them – they are flush with copper.
In fact, the United States Geological Survey (USGS) says of the identified copper that exists on Earth but is yet to be extracted from the ground, about 65% is found in these 5 countries alone.
According to the scientific agency, the 700 million metric tons of copper that has ever been produced equates to just 20% of the estimated resources of the soft, malleable metal still to be discovered.
The USGS says current identified deposits around the world contain an estimated 2.1 billion metric tons of additional copper to the 700 million tons already mined, meaning the total amount of discovered copper totals 2.8 billion metric tons.
Mind-blowingly, it is estimated that undiscovered copper resources amount to about 3.5 billion metric tons. This means collectively there is roughly 6.3 billion metric tons of the ductile metal on Earth.
To put that into perspective, the USGS says 244,000 metric tons of gold has ever been discovered to date. Most of the precious metal has been mined from just 3 countries – China, South Africa, and again, Australia.
Part of the reason significantly more copper is produced is due to its importance – it is a critical metal for the energy transition.
The International Energy Agency (IEA) notes that in a scenario that meets the Paris Agreement goals, clean energy technologies’ share of total demand rises significantly over the next 2 decades to more than 40% for copper and rare earth elements, 60-70% for nickel, and cobalt, and almost 90% for lithium.
The Paris Agreement is a legally binding international treaty on climate change. It was adopted by 196 parties at the UN Climate Change Conference (COP21) in France on 12 December 2015. It came into force on 4 November 2016. Its overarching goal is to hold ‘the increase in the global average temperature to well below 2°C above pre-industrial levels’ and pursue efforts ‘to limit the temperature increase to 1.5°C above pre-industrial levels’.
As the world transitions towards decarbonisation and reaching net-zero emissions by 2050, copper demand is at unprecedented levels. Research suggests by 2050, global will demand will be nearly twice the volumes of copper the world has produced over the previous 3,000 years.
The metal’s applications are wide and varied. It is used in various clean energy technologies such as solar panels, wind turbines, electric vehicles (EVs), batteries, as well as hydrogen production.
Avalon Global Research notes that an EV consumes around 4x (80kg/car) more copper than combustion cars (18-20kg/car), while a solar plant uses some 9,000 pounds of copper per MW of peak capacity. Similarly, wind farms require 5,600-14,900 pounds of copper per MW, while offshore wind farms require 21,000 pounds per MW.
S&P Global suggests current copper production capacity is only projected to increase by about 20% over the next decade. As such, new investments and discoveries of copper resources is urgently required.
These copper supply issues are exacerbated by declining resource quality. The IEA says concerns about resources are more about quality rather than quantity. In recent years, ore quality has continued to fall across a range of commodities. For copper, the average ore grade in Chile declined by 30% over the past 15 years. Extracting metal content from lower-grade ores requires more energy, exerting upward pressure on production costs, greenhouse gas emissions, and waste volumes.
However, it is not all doom and gloom. There’s a growing number of copper plays on the ASX, many of which are on a pathway towards production.
Junior explorer KGL Resources (ASX:KGL) recently said in its latest quarterly report the bullish outlook for copper prices and the essential need for more copper has allowed it to review optimisation for the mine plan of its for its Jervois Project in the Northern Territory.
At the time, KGL Executive Chairman Denis Wood said growing the organisation to deliver the Jervois Project while optimising the mining and process plant remains the highest priority for the company to enable a financial investment decision.
“Exploration continues to increase the confidence of the overall resource and confirm it to be a significant and robust development for the company. The market outlook for copper remains strong. These current market circumstances allow KGL to refine and further improve its plans.”
KGL has appointed Nicholas Spencer as its new Chief Executive Officer (CEO) and Chris Dippenaar as Chief Financial Officer (CFO) to drive the development of the Jervois Copper Project. These appointments have been made as the $73.74 million market capitalisation company progresses work on the optimisation studies for the project post Feasibility Study.
True North Copper (ASX:TNC) in July 2023 began copper sulphate production at its Cloncurry Project in Queensland under an exclusive offtake agreement with Kanins International.
At the time, Managing Director Marty Costello said: “We believe our offtake agreement with Kanins International provides confidence in True North Copper’s revenue generation. The agreement ensures a premium above the London Metal Exchange price for our high-quality copper sulphate, providing a stable and predictable revenue stream.
“This is another milestone completed that forms part of our overarching strategy to become Australia’s next critical minerals producer of copper and cobalt as we finalise restart studies for full-scale production“
This is another milestone completed that forms part of our overarching strategy to become Australia’s next critical minerals producer of copper and cobalt as we finalise restart studies for full-scale production.”
On 20 September 2023 True North received assay results that confirm its Vero resource in Mount Isa, Queensland, hosts ‘large-scale’ and ‘high-grade’ copper-cobalt-silver (Cu-Co-Ag) mineralisation.
Another emerging copper company is Argonaut Resources (ASX:ARE), which has a diversified portfolio that includes the Torrens joint venture with Aeris Resources. The Torrens JV is exploring for Iron Oxide Copper‐Gold (IOCG) systems in the highly prospective Stuart Shelf region of South Australia. The project is situated 75km from BHP’s (ASX:BHP) Olympic Dam mine, within 50km of OZ Mineral’s (ASX:OZL) Carrapateena mine, and only 40km from BHP’s recent Oak Dam West copper discovery.
Meanwhile, In June 2023, Cazaly Resources (ASX:CAZ) received positive Scoping Study results from AuKing Mining’s Koongie Park copper-zinc project which included mineralisation from the company’s 100%-owned Halls Creek and Bommie copper deposits.
In late 2022, Cazaly executed a memorandum of understanding (MoU) with AuKing to include the Halls Creek project into the study. The AuKing study confirms the potential for a financially robust, globally competitive operation with life-of-mine of 11 years with an estimated total production of 110,000t Cu, 38,000t Zn and 355,000oz Ag.
Cohiba Minerals (ASX:CHK) holds a strategic tenement package in the ‘world-class’ Gawler Craton comprising 8 exploration licences covering 831km-square in the Horse Well (Pernatty B), Pernatty C, and Andamooka-Peninsula (Lake Torrens) areas.
In August, CEO Andrew Graham reiterated that Cohiba’s Olympic Domain projects in South Australia remain key priorities and has generated some third party interest.
“We have completed a review of the Olympic Domain projects and identified additional strategic drill hole sites. We have also had numerous discussions in relation to direct investment into the Wee MacGregor copper project in Queensland and are working towards securing an outcome. We have further incentivised this investment opportunity by securing an extension on ML90098, a key Mining Lease at Wee MacGregor, until 31 December 2034.”
Castillo Copper (ASX:CCZ) has 4 properties comprising the NWQ Copper Project in Mt Isa’s copper-belt, the BHA Project near Broken Hill’s ‘world-class’ silver-zinc-lead deposit in NSW, the historic Cangai Copper Mine, and assets across Zambia’s copper-belt.
In July, Castillo produced an updated 2012 JORC-compliant Mineral Resource Estimate (MRE) for its Cangai Copper Mine in New South Wales, Australia.
At the time, Chairman Ged Hall said having a high-grade MRE for circa 114,000 tonnes copper metal plus significant exploration potential was an excellent value-add outcome.
“Moreover, when reconciling Cangai Copper Mine’s favourable fundamentals with long-term global demand trends for copper, the board believes it has a compelling business case to leverage and align with a strategic development partner“
“Moreover, when reconciling Cangai Copper Mine’s favourable fundamentals with long-term global demand trends for copper, the board believes it has a compelling business case to leverage and align with a strategic development partner.”
Kincora Copper (ASX:KCC) is an active explorer and project generator focused on world-class copper-gold discoveries. Kincora’s portfolio includes district scale landholdings and scale-able drill ready targets in both Australia and Mongolia’s leading porphyry belts, the Macquarie Arc, and Southern Gobi respectively.
In July, Kincora signed a conditional agreement to acquire RareX’s (ASX:REE) 35% interest in the Trundle, Fairholme, Jemalong, Cundumbul, and Condobolin projects in New South Wales. Under the agreement, Kincora will issue 40 million chess depositary interests (CDIs) and will grant RareX a 1% net smelter royalty (NSR) for the vended licences.
Great Western Exploration (ASX:GTE) is a copper, gold, and nickel explorer with a large land position in prolific regions of Western Australia. Great Western’s tenements have been underexplored or virtually unexplored.
Write to Adam Orlando at Mining.com.au
Images: True North Copper
Ardiden (ASX:ADV) Non-Executive Chairman Bruce McFadzean stepped down from his post on Monday 21 August to pursue other opportunities.
The company says McFadzean’s resignation was effective as it was announced to the market, and Non-Executive Director Michelle Roth has stepped into the Chair role in an interim capacity.
Meanwhile, Ardiden has appointed Jeremy Robinson and Matthew Freedman as Non-Executive Directors.
Robinson brings with him 2 decades of experience in the resources industry, with his previous roles ranging from Managing Director to Business Development positions. He is currently the principal of Churchill Strategic Investments Group, which Ardiden says has financed multiple junior explorers and developers across the ASX and Toronto Stock Exchange (TSX).
Further to his role with Churchill, Robinson currently serves as Non-Executive Chairman of RareX (ASX:REE) and Executive Chairman of Cosmos Exploration (ASX:C1X), and he is a pending Non-Executive Director of Kincora Copper (ASX:KCC).
Meanwhile, Freedman currently serves as an Executive Director of Dynamic Group Holdings (ASX:DDB) and a Non-Executive Director of Cosmos Exploration.
He has previously held roles with Rio Tinto (ASX:RIO), Worley (ASX:WOR), and Emeco Holdings (ASX:EHL).
Speaking on the board shuffle, Ardiden Interim Chair Michelle Roth says: “I am pleased to welcome Jeremy and Matt to the board. On behalf of the board, I wish to thank Bruce for his leadership and contribution during his tenure as Chair.
“I wish to thank Bruce for his leadership and contribution during his tenure as Chair“
Bruce has overseen the disposal of the last two tranches of the Ontario lithium projects to Green Technology Metals Ltd (ASX:GT1), which saw the inflow of more than $21 million cash and 13,049,520 shares in GT1, leaving Ardiden in a strong financial position. We wish him well as he pursues other opportunities within the industry.”
Ardiden is a junior explorer working to build a ‘high-grade’ gold resource at its Pickle Lake Gold Project in northwest Ontario, which the company says is one of Canada’s most prolific gold mining districts.
The company has $9.35 million cash at hand as of June 30, according to its latest quarterly report.
Write to Joshua Smith at Mining.com.au
Images: Ardiden
Mining.com.au is Australia’s leading online daily Mining news service, reaching hundreds-of-thousands of mining professionals, investors, and industry participants each month. The Weekly Wrap-Up with Harry Mulholland provides listeners with a recap of the mining headlines each week.
In this episode, Harry reports on news from Helix Resources (ASX:HLX), Astro Resources (ASX:ARO), Kincora Copper (ASX:KCC), and Toro Energy (ASX:TOE).
Junior explorer Kincora Copper (ASX:KCC) has signed a conditional agreement to acquire RareX’s (ASX:REE) 35% interest in the Trundle, Fairholme, Jemalong, Cundumbul, and Condobolin projects in New South Wales.
Under the agreement, Kincora, which has an $11.16 million market capitalisation, will issue 40 million chess depositary interests (CDIs) and will grant RareX a 1% net smelter royalty (NSR) for the vended licences.
As part of the acquisition, Kincora has received firm commitments from professional and sophisticated investors for a placement to raise $2 million through the issue of the new CDIs at $0.05 per share.
This price represents a 25.4% and 21% discount to the company’s last closing price and 15-day volume weighted average price (VWAP), respectively, prior to the company’s CDIs being placed in a trading halt on 27 July 2023.
The company says the brokered placement was oversubscribed and includes a 1-for-2 free-attaching option exercisable at $0.075 within 24 months.
Kincora reports the share consideration due to RareX for the New South Wales transaction is subject to shareholder approval, which will be sought at an annual general meeting (AGM) and special meeting slated for September. The deal is also subject to Kincora raising at least $1.5 million through its planned placement — which has been satisfied through the oversubscribed $2 million placement — and both parties obtaining approvals required under the New South Wales Mining Act 1992. Upon completion, Kincora will secure a 100% interest in all its projects in New South Wales.
Kincora reports Big Ben Holdings, the company’s largest shareholder, subscribed for 10.4 million new CDIs and 5.2 million attaching options under the placement. Morgans Corporate and Bridge Street Capital Partners acted as joint lead managers to the placement.
Once the placement is complete, the joint lead managers will be issued 7.5 million unquoted options at $0.075 each expiring in 24 months and will also be paid a cash fee.
Concurrent with the transaction, Kincora also reports it has invited RareX Chair and founder Jeremy Robinson to join its board as a Non-Executive Director and member of its Remuneration Committee.
Commenting on the transaction, Kincora Copper President and Chief Executive Officer (CEO) Sam Spring and Chair Cameron McRae say: “These transactions significantly increase the strategic value of, and funding options for, our NSW project portfolio and strengthen Kincora’s balance sheet.
Kincora will hold 100% ownership in 8 projects, covering 2,367km-square in highly prospective settings within world-class gold-copper mineral belts in a tier-one jurisdiction.
“the company is in a strong position to both extend high-priority drilling and accelerate ongoing asset-level partner discussions”
Coupled with the oversubscribed $2 million raising, the company is in a strong position to both extend high-priority drilling and accelerate ongoing asset-level partner discussions at a time where we are seeing very significant corporate activity in our district.
We are very pleased to welcome experienced resource director and executive Jeremy Robinson to Kincora’s board and a number of new professional investors to the register.”
Also commenting, RareX Chairman and founder Jeremy Robinson says RareX is a ‘big believer’ in Kincora’s portfolio in New South Wales, as evidenced by the company becoming a ‘significant’ shareholder and converting its asset-level interests.
“We expect these transactions to be a real catalyst to accelerate ongoing asset-level partner discussions and also be a positive share price catalyst in the immediate to longer term. I am personally very pleased to assist at the board level and support Kincora’s endeavour to become a significant copper-gold player.”
Kincora Copper is an ASX-listed copper explorer that wields a portfolio of assets in Australia and Mongolia. These assets include the Trundle, Fairholme, Jemalong, Cundumbul, and Condobolin projects in New South Wales and the Bronze Fox Project in Mongolia.
Write to Harry Mulholland at Mining.com.au
Images: Kincora Copper
Canadian explorer Inflection Resources (CSE:AUCU) has struck a $135 million exploration deal with AngloGold Ashanti (ASX:AGG) over a string of projects in New South Wales — right next door to Kincora Copper’s (ASX:KCC) Macquarie Arc assets.
Kincora says the Inflection-AngloGold agreement is a ‘favourable development’ for its own projects on multiple fronts.
Speaking to Mining.com.au, Kincora Copper President and Chief Executive Officer (CEO) Sam Spring says this deal provides technical endorsement to the company’s strategy in this part of the Macquarie Arc belt.
He says Kincora was an early entrant into the region, pegging the ‘most prospective’ shallow-to-moderate sections of the belt before Australian iron ore producer Fortescue Metals Group (ASX:FMG) and Inflection consolidated the remaining ground.
“The northern covered section of the Macquarie Arc offers clear Cadia-scale targets. It is absolutely mystifying why so little exploration has been carried out to date in this region, so credit to AngloGold Ashanti for recognising this with the transaction with Inflection. The undercover part of this belt is a major opportunity with huge upside.
“It is absolutely mystifying why so little exploration has been carried out to date in this region”
We look forward to seeing the results of drilling at Inflection’s Duck Creek prospect, located within 2.5km of our Nyngan Project boundary, with 2 rigs commencing this week, as we shortly drill our highly prospective Nevertire Project that we feel is a real standout target and supported by a cooperative funding grant from the NSW government.”
While Kincora says Inflection has been the first group to undertake drilling campaigns within the northern Junee-Narromine belt, the company believes its Nevertire Project is shallower, with a larger target area, and more compelling geological vectors.
Additionally, Kincora says the Northern Macquarie Arc compares favourably to other current global exploration hotspots for porphyry exploration, including the Golden Triangle in Canada, the Vicuna district in Argentina and Chile, and the Northern Andean Belt.
Under the deal with Inflection, AngloGold will provide up to $10 million of exploration expenditure across a portfolio of projects as part of a phase one exploration program. This program will drill test a wide range of large, intrusive-related copper-gold targets, including the Duck Creek Project. Phase one also includes a minimum expenditure commitment of $6 million and a 10% management fee payable to Inflection.
Meanwhile, phases two and three of the agreement are staged earn-ins under which AngloGold may select up to 5 designated projects in which it can earn a 65% interest by funding $27 million in exploration expenditures on each designated project for a cumulative maximum expenditure of $135 million.
AngloGold also retains a further right under phase four to earn an additional 10% interest in each designated project by sole-funding a Prefeasibility Study (PFS) based on a minimum of 2 million ounces of gold or gold-copper equivalent measured and indicated resources.
Subject to existing underlying royalties, Inflection will be granted a 2% or 1% net smelter royalty (NSR). Additionally, Inflection estimates the phase one exploration program will consist of about 30,000m of drilling with 2 initial drill rigs.
The company intends to start drilling in the coming days, with an initial focus on completing deep drillholes at the Duck Creek project.
Commenting on the agreement, Inflection CEO and President Alistair Waddell says: “The execution of this agreement with AngloGold sets the foundation for the upcoming exploration program and provides the necessary capital to aggressively drill test and potentially develop our large portfolio of copper-gold porphyry targets within the northern extension of the Macquarie Arc.
We very much look forward to working with our partners AngloGold to explore the portfolio of targets over the coming years.”
This sentiment is shared by AngloGold, with its SVP Greenfield Exploration Philip Newton saying the company is excited to partner with Inflection for this opportunity in a proven tier-one terrane and to contribute towards a promising project in Australia.
“The complementary skills of AngloGold and Inflection can accelerate the discovery process in a sustainable manner that benefits all stakeholders.”
“The complementary skills of AngloGold and Inflection can accelerate the discovery process in a sustainable manner that benefits all stakeholders”
Kincora Copper is an ASX-listed explorer focused on becoming Australia’s ‘leading’ pure-play porphyry explorer in the country’s foremost porphyry belt.
The company holds a portfolio of copper-gold assets in New South Wales, including the Trundle, Fairholme, Condobolin, and Northern Junee-Narromine Belt projects, as well as the Southern Gobi Belt Project in Mongolia.
Inflection Resources is a Canadian copper-gold exploration company with a portfolio of projects with AngloGold in New South Wales and the Carron Project in Queensland.
AngloGold Ashanti is an ASX-listed global miner focused on its portfolio of operations, projects, and exploration activities across 9 countries spanning 4 continents.
Write to Harry Mulholland at Mining.com.au
Images: Kincora Copper Ltd
This article is a sponsored feature from Mining.com.au partner Kincora Copper Ltd. It is not financial advice. Talk to a registered financial expert before making investment decisions.
If mining is a tough game, the exploration juniors out there have it the toughest. The road to discovery and, ultimately, to production is a long one with no shortage of pitfalls.
As if funding issues and the cyclical nature of the industry weren’t enough, there’s finding — and keeping — the right team, discovering an economically viable resource, managing ESG complexities, and gaining access to infrastructure, plus all the geopolitical, sovereign and economic bunk that comes with running a business.
In the end, success comes down to having the right plan. And as President and CEO Sam Spring explains to Mining.com.au, Kincora Copper (ASX:KCC) has a good one.
Benefiting from an industry-leading technical team with multiple tier-one copper-gold discoveries to their CVs, the company holds an impressive portfolio of copper-gold assets in New South Wales’ Macquarie Arc and Mongolia’s Southern Gobi — 2 of the most prolific porphyry regions the world has to offer.
Those in NSW include the Trundle, Fairholme, Nevertire, Nyngan, Mulla, Jemalong, and Condobolin projects, as well as the Cundumbul project, where Kincora’s recently appointed exploration alliance partner, Earth AI, is leveraging some clever technology in its fieldwork. Collectively, these assets represent a pipeline of 13 copper-gold targets already primed for drilling.
Indeed, that is a hefty opportunity itself. But it’s Kincora’s assets in Mongolia that could make all the difference.
Prior to 2012, Kincora was no more than a private equity group with a deal to acquire the Bronze Fox project it now owns in full, located in the south of Mongolia — within trucking distance from China — and previously held by Canadian resources giant Ivanhoe Mines.
At the time, Spring was involved in the broking side of things.
“The original vendor didn’t have a management team, they didn’t have a vehicle. We helped form that in 2011, helped structure what became Kincora,” Spring tells this news service.
“The Bronze Fox project was previously held by Ivanhoe and had some really encouraging early results. It was highly rated, but it was Oyu Tolgoi that really took over. In 2012, Kincora drilled 1,000 metres of 0.4% copper equivalent, with 37 metres of over 1%. And that’s when I joined Kincora and made the move to the corporate side. This was driven by looking to assist run an exit strategy, having had a large cash offer for the company, a significant 8-figure deal and multiple of our current market cap, and in total 14 NDAs with the major copper industry players.”
But then things took a turn. Mongolia’s economy “overheated”, and a government corruption case resulted in the cancellation of 106 licences. Though Kincora managed to regain the two licences it lost after 2.5 years, by late 2019 the commodity cycle had turned, and Kincora had resolved to look at opportunities closer to home.
The focus these days might be on NSW, but while economic and political conditions in Mongolia have been through certain phases, the prospectivity of the region hasn’t changed. Bronze Fox still hosts 3 large, underexplored porphyry systems, and boasts an inferred mineral resource estimate of 426,000 tonnes of copper and 437,000 ounces of gold.
Xanadu Mines (ASX:XAM) has recently started a 54,000m drilling program at its flagship Kharmagtai porphyry project, located in the same belt and age rocks as Kincora’s Bronze Fox project. This further illustrates the prospective and underexplored nature of Bronze Fox. Kharmagtai has already had over ten times the amount of drilling as just the existing JORC resource area, which is a small portion of one of three very large porphyry systems at Bronze Fox.
In the past 12 months, there has also been a resurgence of investment activity in Mongolia, largely off the back of a reset deal between the Mongolian Government and Rio Tinto (ASX:RIO) for the Oyu Tolgoi project. Some of the world’s biggest players — including Rio, BHP (ASX:BHP) and Zijin Mining (SHA:601899) — have forked out monster fortunes. Rio’s investment alone exceeds US$10 billion ($15.4 billion).
With that in mind, Spring is looking to pull the trigger on an externally led strategic review of Kincora’s Mongolian portfolio — the ultimate aim being to land a third-party investor to assume the funding of the assets and potentially provide Kincora with the capital to expand its operations in NSW. As Spring notes, such an arrangement could also see Kincora retain its exposure to the substantial geological potential that still exists in the Southern Gobi.
“This strategic review will consider all the different options and will include recent inbound interest, with the fundamentals of: how do we maximise shareholder value, and how do we try and streamline our focus on NSW?”
“This strategic review will consider all the different options and will include recent inbound interest, with the fundamentals of: how do we maximise shareholder value, and how do we try and streamline our focus on NSW?
Because, really, the focus of the business for the last three years has been on NSW, where we’ve drilled about 30,000 metres and confirmed our geological concepts. We’ve got a pipeline of 13 high-impact and large-scale copper-gold targets that we’re in the process of drilling at the moment across five projects.
It’s really hard for a junior to do two district-scale portfolios, in two jurisdictions, justice. Recently we have been patiently adding value to the Mongolian asset portfolio — gaining a mining license, defining a JORC resource, discovering a new, third porphyry system — but with these expressions of interest for the portfolio, it’s the right time to run a formal review process.”
Given the swings-and-roundabouts nature of mining and exploration in Mongolia, Spring was forthcoming when asked what advantages zeroing-in on NSW presents.
“It certainly doesn’t hurt when you move from an emerging jurisdiction to a more developed one.
There’s fantastic ability in New South Wales to get historical exploration records, get public sector surveys, get access to pegging, and secure ground. That really has helped us streamline how quickly we’re able to do project reviews, generate targets, leverage historical expenditure, drill, and get positive results… But also, we’ve been on the right end of some meaningful cooperative funding grants from the government.”
NSW is also where the Kincora team feels it has a competitive advantage. Spring attributes a portion of the successful shift away from Mongolia to Technical Director John Holliday, who joined Kincora in 2017, and whom Spring described as “one of the foremost figures in this part of the world”.
Spring notes: “John was principally responsible for the origination, management and discovery phases of Cadia, which is the largest porphyry project in Australia and the largest alkalic porphyry system in the world. When John was at Newcrest, he really had a good look at most of the projects within central-west New South Wales.”
The drill rig is currently turning at the Condobolin project, where Kincora has seen some high-grade, near-surface gold and base metal results, with further assays to come. Before that, the company completed 5 diamond drill holes at Trundle, which confirmed an extensive, multiple-system copper-gold complex across a 3.2km mineralised strike, up to 900m wide and with a vertical depth — which remains open — exceeding 800m.
In an exploration update on 10 May 2023, Holliday noted that the results “illustrate the very extensive scale of the mineralised zone at the southern portion of the Trundle licence”, with assays measuring up to 2.24% copper and 1.75 grams per tonne of gold.
“It’s execution. That’s the stage we’re at”
As far as Spring is concerned: “It’s execution. That’s the stage we’re at.
We have applied very systematic and detailed exploration, made the most out of the previous drilling and exploration results that we’ve had over two and a half years of pretty aggressive drilling across NSW.
There is now nothing else we can do except drill these targets, assess whether our exploration concepts are correct. And can we make a new, globally significant discovery — or even two?”
It’s the same question Kincora’s exploration partner, Earth AI, seems to be asking.
Few industries remain untouched by the rapid advancements in technology of recent years. Rather than resisting — as the temptation seems to be — producers and explorers are leaning into it, looking to leverage the embryonic but potentially game-changing powers of things like artificial intelligence.
“I guess there are certain areas where you can see that it makes sense. Like, how do you optimise throughput from a mining operation, or how do you optimise an existing orebody — how do you, effectively, better engineer a solution?” Spring says.
“You can grow a lot more power through these systems, and you’ve got good quality data that goes in, and you’ve got good quality outcomes that come out.”
Headquartered in San Francisco, US, with a field base in Young, NSW, Earth AI employs a vertically integrated approach to metals exploration, including targeting, testing and verifying discoveries with its proprietary predictive AI platform and Mobile Low Disturbance (MLD) diamond drill rig.
The exploration alliance was signed in October 2022, outlining a ‘success-based’ relationship under which artificial intelligence and machine learning would be used to generate and drill test targets at Kincora’s Cundumbul project. Earth AI has committed up to $4.5 million in expenditure and stands to earn a 3% royalty should it make a new discovery.
Since technological platforms of this kind are more commonly used to optimise existing mining processes, Spring admits that “exploration is a little bit more of a dark art, and a lot more subjective”.
“We’re very keenly learning how Earth AI go about their exploration approach. One thing that we’ve really liked is there’s a good team of experienced geologists involved with Earth AI and they’ve gone out and taken a boots-on-the-ground approach to ground truthing.
They’ve identified these targets and areas with their AI process. They’ve field-checked that, they’re updating their model, trying to work out if their hypothesis is correct and applying geology to that to then refine and de-risk the targets.”
In the end, all this work is part of a broader mission to bridge what Spring calls “the valuation gap”.
With such successful neighbours in central-west NSW — including Newcrest Mining (ASX:NCM), Evolution Mining (ASX:EVO), Alkane Resources (ASX:ALK), CMOC Group (SHA:603993), and Fortescue Metals (ASX:FMG) — Kincora has identified a clear path to a loftier market capitalisation.
Even its junior peers with similar landholdings and drilling results — like Magmatic Resources (ASX:MAG), valued at roughly $27 million, and Superior Resources (ASX:SPQ), at almost $53 million — far exceed Kincora’s current valuation of just under $10 million.
Magmatic’s Corvette prospect, for example — which sits within its broader Myall project — is located around 60km from CMOC’s Northparkes project, where recent drilling confirmed an extensive porphyry system across a 700m strike. It’s therefore considered a close direct peer to Kincora’s Trundle project, located 30 kilometres from Northparkes, where an extensive porphyry system exists across a 3.2km strike.
“We pegged our Nyngan and Nevertire projects when the Boda discovery happened,” Spring says. That discovery landed Alkane Resources (ASX:ALK) the NSW Minerals Council’s Explorer of the Year award in 2021 and 2023.
“Then Inflection came in and pegged the ground around FMG and us, and they made a new discovery within two-and-a-half kilometres of our licence boundary at Nyngan. And off the back of that, they’ve got this Heads of Agreement that they’re working to convert into a definitive earn-in agreement with AngloGold Ashanti (ASX:AGG), which contemplates up to $135 million worth of exploration expenditure.”
“So, catalysts to bridge what we think is a clear and large valuation gap are some of the things that hopefully people can keep an eye out for, driven by both our strategy with the drill bit and corporately”
Prior to that agreement with AngloGold, Canadian-listed Inflection Resources (CNSX:AUCU) had been sitting at a market capitalisation of about CAD$8 million ($9 million), but that figure is closer to CAD$20 million ($23 million) today.
“For us, we’d like to think that the ground that we’ve got is district scale and very strategic in that part of the world. And based on the Inflection deal, it provides a great direct peer group comparison for us, in addition to Magmatic’s Corvette prospect,” Spring adds.
“So, catalysts to bridge what we think is a clear and large valuation gap are some of the things that hopefully people can keep an eye out for, driven by both our strategy with the drill bit and corporately.”
For now, it’s just a matter of doing the work — trudging through an encouraging pipeline of targets in the hope of making a meaningful discovery and pursuing corporate opportunities to create shareholder value.
“As mentioned, in Mongolia we’re contemplating this external strategic review, so I’d expect that there’d be some news flow there,” Spring explains.
“But beyond those immediate work programs, it’s on to Nevertire next, in terms of the next project that we drill after Condobolin. And we expect to see some decent numbers there from what we have seen come out of the ground. It’s working through that pipeline of 13 targets across the 5 projects, plus Earth AI’s work and expected near-term drilling at Cundumbul. And then at the same time, are there some synergies and technical endorsements that can also be unlocked — like Inflection’s deal with AngloGold Ashanti?”
Sam Spring is indeed a man with a plan — what seems to me a good plan. But, of course, the proof of the pudding is in the eating. Whether it works or not remains to be seen.
There is, however, one small certainty — we’d be wise to pay attention.
Write to Oliver Gray at Mining.com.au
Images: Kincora Copper Ltd
Australian exploration company Kincora Copper (ASX:KCC) started Q1 2023 ‘strongly’, with drilling restarting at its Trundle Project in the Central West region of New South Wales.
As outlined in a company quarterly report, Kincora started a new high-impact phase of drilling at Trundle on 10 January to test 5 adjacent systems and separate large-scale porphyry targets across an existing 3.2km mineralised strike.
This drilling confirmed an ‘extensive’ gold-copper complex, with 4 adjacent mineralised targets returning shallow ‘high-grade’ and broad gold-copper results. A technical workshop is planned for the end of May to review the final results and plan follow-up activities.
Meanwhile, during Q1 2023, Kincora’s exploration partner, Earth AI, began reconnaissance fieldwork at the Cundumbul Project in New South Wales to assist, confirm, and refine target assessment ahead of a planned drilling program utilising Earth AI’s in-house diamond drill based in Young.
Under the exploration partnership, Earth AI will spend up to $4.5 million to generate and drill test targets to earn a royalty only upon a new drilling discovery. The company says this agreement does not affect the capital structure of Kincora or the current ownership of the project.
Following shareholder approvals for tranche 2 of a December 2022 capital raising, Kincora reports that Australian mining and engineering company The Bloomfield Group is now the company’s largest shareholder.
Additionally, The Bloomfield Group Chief Operating Officer (COO) Luke Murray joined Kincora’s board as a non-executive director, bringing with him senior executive experience in open-cut mining, processing, logistics, and permitting in New South Wales.
During Q1, Kincora also successfully appealed its ongoing defence of a 2016 tax ruling in the Mongolian Supreme Court. The company says the appeal followed an ‘adverse’ Appeal Court ruling, outside the litigants’ appeal and counter-arguments, which overturned a priority First Instance Administrative Court and preceded a timeframe ‘far too short’ to consider the merits of the case.
Commenting on the company’s Q1 activities, Kincora Copper President and Chief Executive Officer (CEO) Sam Spring says: “Kincora has made a strong start to the ongoing drilling program that will drill test a total of 13 gold-copper discovery opportunities across 5 projects, and in addition to this, it is pleasing to see our artificial intelligence (AI) exploration alliance partner, Earth AI, commence fieldwork at the Cundumbul Project.
Initial drilling results further illustrate the very extensive scale of the mineralised system at the brownfield Trundle Project, with demonstrated higher-grade potential, including most recent assay results of up to 2.24% copper and 1.75g/t gold.
Initial visual results are encouraging from our maiden drilling program at the Condobolin, where high-grade gold-base metal results are expected at 3 targets.
“There is a strong pipeline of news flow and value catalysts in the upcoming quarter, which we expect to be a very exciting period for the company”
There is a strong pipeline of news flow and value catalysts in the upcoming quarter, which we expect to be a very exciting period for the company. We continue to see many significant positive developments in our district, including new mine permits, exploration successes and increasingly corporate transactions from earn-in exploration agreements to billion-dollar-plus M&A (mergers and acquisitions).”
Kincora Copper is an Australian exploration company with an ambition of becoming the leading pure-play porphyry explorer in the Macquarie Arc of New South Wales.
The company’s portfolio of assets includes the Trundle, Fairholme, and Condobolin projects in the Junee-Narromine Volcanic Belt and the Cundumbul Project in the Molong Volcanic Belt. Additionally, Kincora also holds the Tourmaline Hills, Bronze Fox, and Red Well projects in the Southern Gobi belt of Mongolia.
Images: Kincora Copper Ltd
Kincora Copper (ASX:KCC) has confirmed an ‘extensive’ multiple system porphyry complex at its Trundle Project in New South Wales.
The company reports assay results from 4 of the 5 holes drilled at 4 adjacent but separate minerals system targets at Trundle, combined with detailed geological logging of all holes suggest an interpreted proximal setting to the targeted porphyry systems.
Kincora says this setting, coupled with the coincident magnetic response across a long strike which is open both to the north and south, strongly supports the concept that the southern portion of Trundle potentially hosts clusters of ‘high-grade’ and gold endowed porphyry copper and skarn deposits.
Speaking to Mining.com.au ahead of a visit to the Melbourne Mining Club yesterday and then the RIU Sydney Resources Round-up today (10 May 2023), Kincora Copper President and CEO Sam Spring says the results had significant intervals of ‘high-grade’ and localised mineralisation, but also lower grade intervals with alteration.
“The mineralisation suggests we’re in a proximal environment to the core of 4 separate porphyry intrusion related systems, so (we’re) confirming a very extensive gold-copper system. 4 separate parts within that system, each suggesting that we’re pretty close to where you want to be within the system.”
Kincora reports the drilling has confirmed a 3.2km mineralised strike from shallow depths, up to 900m wide, and a vertical depth of greater than 800m. The observed alteration and mineralisation at each prospect drilled during this program are interpreted to be analogous to a proximal setting in comparison to the deposits at the Northparkes and Cadia mines.
The CEO tells this news service a workshop, led by its technical committee, is scheduled for the end of May to undertake an analysis and review, pending results.
“These results suggest we’re pretty close to where you want to be without having drilled a clear discovery interval”
“These results suggest we’re pretty close to where you want to be without having drilled a clear discovery interval. At the end of the month we’re doing a technical workshop, by that stage all results including the fifth hole, and ongoing analysis and review should be completed to effectively understand where the priorities are for follow-up drilling.
So we’re very encouraged, and these results really confirm our thesis that this southern part of the Trundle licence hosts the potential for a series or cluster of these porphyry type deposits, like what you see at the big projects in this immediate belt, but also porphyry projects globally.”
In the interim, Kincora says a maiden drilling program has started at the Condobolin Project to test 3 near-surface, ‘high-grade’ gold-base metal targets within a 2km radius.
Kincora reports the current phase of drilling at Trundle began in January, and has currently drilled 5 diamond holes for 1,972m across 4 adjacent mineral systems.
At the Botfield prospect, Kincora has completed 2 holes which drill tested a large magnetic high complex coincident with shallow anomalous copper-gold results and an induced polarisation (IP) chargeability high anomaly.
Assay results recorded at Botfield include hole TRDD037 with 2.9m @ 0.62g/t Au and 0.95% Cu within coarse banded chalcopyrite-bornite-pyrite veins from 129m to 132m, including 0.9m @ 2.24% Cu, and 1.75g/t Au from 131m.
This hole also recorded 31m @ 0.16g/t Au, and 0.08% Cu within massive magnetite-pyrite-chalcopyrite skarn over 80% magnetite from 393m to 424m; and 18m @ 0.20g/t Au, and 0.10% Cu within banded magnetite-pyroxene-feldspar skarn with pyrite and chalcopyrite, and less than 30% magnetite from 402m to 420m.
Kincora says visual observations from hole TRDD039 include strong hydrothermal hematite-silica alteration overprinting early feldspar altered volcaniclastic conglomerate and coarse banded chalcopyrite-pyrite vein from 92m to 94m, interpreted to be like the intercept recorded from 129m to 132m in TRDD037.
Spring adds that with these results returned, Kincora was keen to embark on Melbourne and then Sydney today for the RIU conference.
“Given our announcement today being at RIU I’ve always found it’s pretty good that you’ve got high-net worth people, sort of family office guys walking the floor and a few instos that are generally amenable to catching up face-to-face.
They generally don’t walk the floor, but they’re happy to meet if schedules allow, because that’s who the focus for us this week is, catching up with the brokers that have sort of backed the Kincora story in the past and still provide written research. So, it should be good timing in terms of catching up with everyone with these new results out.”
Kincora Copper is an ASX-listed copper exploration company focused on ‘world-class’ copper gold discoveries in the Macquarie Arc of New South Wales. The Trundle Project consists of a single exploration licence covering 167km-square in the Junee-Narromine volcanic belt of the Macquarie Arc, less than 30km from the mill at the Northparkes mine.
Images: Kincora Copper
Australian porphyry deposit explorer Kincora Copper (ASX:KCC) has started reconnaissance fieldwork with its exploration alliance partner Earth AI at the Cundumbul Project in New South Wales.
Following a thorough geological research and artificial intelligence (AI) targeting phase, Kincora says Earth AI has started ground truthing fieldwork to confirm and refine the drillhole targeting hypothesis at Cundumbul.
The company says it will seek to leverage Earth AI’s vertically integrated, proprietary AI and machine learning capabilities to generate, fund, and drill test targets.
Speaking to Mining.com.au, Kincora Copper Chief Executive Officer (CEO) and President Sam Spring says the company entered the exploration alliance with Earth AI late last year.
“Earth AI is an artificial intelligence and machine learning group that is based out of New South Wales. They’ve got a field camp in Young, and they’ve been involved with picking up a few projects and doing a couple of deals similar to ours, where effectively they take the available project, and regional level data and feed that into their proprietary systems to identify targets, which they did as part of their initial due diligence on our Cundumbul Project.
“I guess the next step, once they identify targets and secure ground, they go out and ground truth those targets which is the stage we’re at with them now”
I guess the next step, once they identify targets and secure ground, they go out and ground truth those targets which is the stage we’re at with them now. Before then, looking to confirm their hypothesis, update their models, make sure that the artificial intelligence, and the geology and tying and sort of refine and upgrade their confidence on those targets before drilling them.”
Earth AI is a San Francisco-headquartered AI company that has a vertically integrated metals exploration approach to targeting, testing and verifying discoveries that are required for the electric vehicle and renewable energy revolutions. Earth AI has an in-house geological team, proprietary mineral exploration AI predictive technology, supported by boots on the ground field assessment approach and an in-house drilling department.
Earth AI seeks to efficiently reduce the lead-time and cost to discovery, with drilling utilising its Mobile Low Disturbance (MLD) diamond rig and associated proprietary equipment. Earth AI’s NSW field base is located in Young.
Spring says the exploration alliance allows for a 50:50 co-funding model and joint technical committee where Earth AI will have day-to-day management and control of exploration activities, and will contribute up to $4.5 million of total exploration expenditure across the project over a 2-year period with an option to extend for a further year.
Subject to a minimum of 1,500m of diamond drilling and a qualifying drill intersection resulting in a new discovery, Earth AI is entitled to a net smelter return royalty of up to 3% in connection with a to be agreed upon area surrounding the discovery.
The CEO tells Mining.com.au the exploration alliance means Earth AI generates and funds targets for Kincora, and will seek to drill them in what is essentially a success-based alliance that only upon a new discovery does Earth AI obtain a royalty.
“So it’s one of those that you have the project being advanced by a really interesting group with sort of leading edge technology, and I guess we’ll learn a fair bit about what that AI process means as part of the journey”
“So it’s one of those that you have the project being advanced by a really interesting group with sort of leading edge technology, and I guess we’ll learn a fair bit about what that AI process means as part of the journey.”
The Cundumbul Project is in the central Molong volcanic belt of the Macquarie Arc within the Lachlan Fold Belt in Central West New South Wales. The project is about 30km south of Alkane Resources (ASX:ALK) Northern Molong Porphyry Project, 25km north of Copper Hill, and 70km north of the Cadia mine.
Kincora says previous exploration at the project has included mapping, soil sampling, rock chip sampling, induced polarisation (IP), gravity, and magnetic geophysical surveying, with more limited follow-up auger, reverse circulation (RC), and diamond drilling.
Commenting on the company’s current exploration activities, Spring adds to this news service that work is ongoing at the Trundle Project.
“We’re drilling at Trundle, and we’ve got a pipeline of 13 copper-gold targets in our own right that we’re looking to drill across 5 projects at the moment. We’ve put out our first assay results for Trundle and a second update due pretty shortly. It’s nice to have another sort of project in the portfolio that’s being pushed forward, but there’s already 13 targets in the pipeline that are at the discovery stage that we should have a pretty active news flow pipeline for.”
Earth AI is an AI company based in San Francisco that has a vertically integrated metals exploration approach to targeting, testing, and verifying discoveries that are required for the electric vehicle and renewable energy revolutions.
The company has an in-house geology team, proprietary mineral exploration AI predictive technology, supported by boots on the ground field assessment approach, and an in-house drilling team.
Earth AI says it seeks to efficiently reduce the lead time and cost to discovery, with drilling utilising its Mobile Low Disturbance (MLD) diamond rig and associated proprietary equipment.
Kincora Copper is an Australian exploration company aiming to become the leading pure play porphyry explorer. The company’s portfolio includes a range of projects in New South Wales such as the Trundle, Fairholme, Condobolin, Northern Junee-Narromine Belt, Cundumbul, and Macquarie Arc projects, as well as the Southern Gobi Belt Project in Mongolia.
Images: Kincora Copper Ltd
With the world well on its way making the revolutionary leap towards renewables and green energy technologies, global demand for copper continues to soar, in line with the ever-growing demand for electric vehicles (EVs) and electrical appliances.
The soft reddish brown metal is an excellent conductor of heat and electricity while also being inherently malleable, ductile, and resistant to corrosion. Hence the demand given these characteristics.
Yet questions continue to go unanswered as to where the much-needed production will come from.
According to the Department of Industry, Science, Energy and Resources (DISER) March 2023 Resources and Energy Quarterly (REQ) publication, global mined copper production remained stagnant in 2022 hitting almost 22 million tonnes. This was up a marginal 0.8% from a year earlier.
Global mined copper production is forecast to grow 5.4% to almost 23 million tonnes in 2023, despite ongoing disruptions in major producing regions, in order to fulfil the demand by the growing electric vehicle (EV) market. Yet copper consumption this year world-wide is expected to increase by 2.1% to reach 26 million tonnes. That is a deficit of 3 million tonnes.
So where in the world will this much-needed production of mined copper come from?
South America and the Democratic Republic of the Congo produce a combined 45% of the world’s copper. However, in 2022 production in Chile plummeted by 5.2%, due to the aforesaid myriad of supply disruptions. Mined production in Peru improved 4.9% year-on-year despite its challenges, although whether this growth will continue remains to be seen.
DISER reports recent disruptions in South America include widespread protests in Peru, which were mostly in major copper-producing regions. Adding fuel to this was a fire at Ventanas Port (Chile), heavy rainfall in Indonesia, as well as contractual disputes at Cobre Panama (Panama) and Dikuluwe-Mashamba (Democratic Republic of Congo).
As a global leader in mining, Australia is one nation that could emerge as a saviour.
The country currently has about 15 projects within its pipeline out to 2026 poised to produce copper, which collectively could produce 503.5 kilotonnes per annum. DISER reports that an estimated up to $8.87 billion in new capital investment will be needed for these projects to come online.
DISER reports that in Australia, mined production is forecasted to grow at an average rate of 3% over the outlook period, reaching 927,000 tonnes in 2027–28. However, the report duly notes that there is a projected fall in Australian output from 2027–28.
OZ Minerals’ (ASX:OZL) West Musgrave project is the most significant new project of the 15 poised to come online. West Musgrave is expected to add about 41,000 tonnes of copper capacity per annum when in production.
Additionally, there are several other large projects with a completed Definitive Feasibility Study (DFS) that could come online near the end of the period in Australia. These projects include Develop Global’s (ASX:DVP) Sulphur Springs Copper-Zinc Project in Western Australia, as well as Round Oak Minerals’ Stockman Project in Victoria. Both of these anticipated projects are projected to produce 15,000t of copper annually and are scheduled to come online by 2024.
On the junior end, one exploration company working to bridge this gap between current copper supply and demand dynamics in the longer term is ASX-listed company Kincora Copper (ASX:KCC), particularly with its Trundle Project in New South Wales.
“That is where new discoveries in good jurisdictions are positioned to significantly benefit and are needed, with the juniors having a much better success rate at making these discoveries”
Kincora Copper President and CEO Sam Spring tells Mining.com.au that the lack of new development to advanced exploration projects, particularly in tier-one jurisdictions like Australia, is becoming increasingly the focus given the upcoming structural deficit and immediate supply side challenges. He says this is resulting in increased reliance on existing brownfield projects and M&A.
“That is where new discoveries in good jurisdictions are positioned to significantly benefit and are needed, with the juniors having a much better success rate at making these discoveries.
Trundle certainly is well positioned given results to date, its location and position within a brownfield setting to an existing large scale and hungry mine. The ongoing drilling program will help hopefully get Trundle to the next stage, but there needs to be many other juniors drilling and advancing similar scale potential projects given the hurdles and stages for new project development, and the projected scale of the upcoming copper deficits.”
Spring adds that Australia has the second largest resources of copper in the world, which helps illustrate the country’s ‘excellent’ geological endowment and further prospectivity. However, he notes that the country is still not in the top 5 of the largest producers globally.
“There are three clear tier-one copper provinces, the Gawler Craton in SA, Mt Isa in Queensland and the Lachlan Fold Belt in NSW, with considerable recent exploration success in the Paterson region (in WA). The Lachlan Fold Belt certainly benefits from existing infrastructure and depth of cover to these other regions.
There is very strong government support, and existing exploration through-to-mining cultures in WA and NSW to push forward new critical mineral projects.
As such, and given Australia being a tier-one mining and investment jurisdiction, we are well positioned to increase copper supply from existing resources and the project pipeline you mention but also from other advanced exploration projects not already included in that project pipeline beyond 2026.”
Castillo Copper (ASX:CCZ) is another junior looking to bridge the supply gap. Castillo is currently seeking a joint venture (JV) partnership with a mining company as it progresses both its Cangai Copper Mine and Big One deposit in New South Wales and Queensland respectively.
The company’s Managing Director Dr Dennis Jensen tells Mining.com.au Castillo hopes to complete holding talks for its Cangai mine by the end of the year in order to work towards potential production. Jensen says the company, like many juniors, has a part to play in satiating the world’s demand for copper, and that Australia as a continent will itself play a major role where copper is concerned.
“We’ve obviously got a part to play. Certainly in the immediate future, we could play a role in playing our part towards satiating the world’s copper demand”
“We’ve obviously got a part to play. Certainly in the immediate future, we could play a role in playing our part towards satiating the world’s copper demand. But in the longer term, I think that there’s potential with the sort of continent that we have, for us to play a more major role as far as copper is concerned.”
Meanwhile, Helix Resources (ASX:HLX) has the Collerina, Rochford Copper Trend, and Canbelego joint venture (JV) projects in its portfolio, the most advanced being the latter, which has a 1.5Mt resource. This project has been ‘aggressively’ drilled over the past 18 months through both reverse circulation (RC) and diamond drilling. According to company Managing Director Mike Rosenstreich, Helix is expected to release a new mineral resource update during the June quarter of 2023.
Another company looking to join the fray is Cohiba Minerals (ASX:CHK), which has its sights set on investing in the resource sector through direct tenement acquisition, joint ventures (JVs), farm in arrangements, and new project generation. With both the South Australian-based Olympic Domain and Wee Macgregor projects in its exploration arsenal, the company has been primarily focused on exploring and advancing both the Pernatty C and Horse Well (Pernatty B) tenements.
As has been well-documented, such junior exploration plays will be vital in the supply of copper on the back of the growing EV market, which continues to be a major driver of copper demand.
EVs have been at the centre of the global decarbonisation stage the past decade, with sales in the US alone increasing from a mere 0.2% of total car sales in 2011 to 4.6% in 2021, according to the US Bureau of Labor Statistics.
This trend has also been noted in Australia, with figures published by the Federal Chamber of Automotive Industries (FCAI) demonstrating 33,410 EVs were reported as sold in 2022, an increase of almost 94% on the previous 17,243 figure in 2021.
FCAI, which represents the manufacturers and importers of passenger vehicles, light commercial vehicles, and motorcycles in Australia, says battery EVs accounted for 6.8% of sales with 5,932 sold in February 2023, while zero and low emission sales (inclusive of hybrid and plug-in hybrid vehicles) accounted for 13.9%.
The drive towards a greener future evidently is demonstrating the world’s growing appetite for hybrid vehicles and EVs, which in turn is fueling this demand for copper.
While the world needs near-term production of copper to meet the immediate needs of the world and the transition to net zero emissions, it seems the story that is emerging is the essential role Australian junior explorers will need to take to ensure longer term supply chains.
Images: Kincora Copper Ltd & DISER
Kincora Copper (ASX:KCC) has uncovered ‘significant’ zones of shallow mineralisation from a diamond drilling (DD) program currently underway across the Dunns North, Dunns South, and Botfield prospects within its brownfield Trundle Project in New South Wales.
The company says results, which have returned gold grades up to 14.2g/t Au from Dunns North and additional grades of 6.88g/t Au from Dunns South, are ‘very encouraging’ and indicate ore grade mineralisation at relatively shallow depths.
Speaking to Mining.com.au, company President and Chief Executive Officer (CEO) Sam Spring says drilling is being undertaken across 5 standalone targets across Trundle, and indicates that skarn mineralisation at the Botfield prospect shares similarities to the Southern Extension Zone discovery.
Spring told this news service that this discovery has been developed over the last 18 months and has been interpreted to potentially be the largest mineralised skarn system in New South Wales.
The CEO notes drilling completed so far has intersected 50m of massive banded magnetite skarn from about 330m vertical depth, and that geophysics suggest that the core of the system is about 250m out to the east and close to surface.
“We have drilled about 25,000m to date at Trundle and have made 2 technical discoveries. In this next phase we are looking at putting 3,000m into the 5 standalone targets and hopefully getting some economic grades that warrant getting to that milestone of a drillout.
“…we are looking at putting 3,000m into the 5 standalone targets and hopefully getting some economic grades that warrant getting to that milestone of a drillout”
We need to do more work on Botfield North and South, we have some good numbers near the surface we have announced today that remain open, and we have created a new search space for ourselves there…this current program is all about discovery drilling.
At Botfield you are seeing that 500m close to the surface. We have hit 50m of massive banded magnetite skarn from about 330m vertical depth and the geophysics seem to be working quite well and suggest that the core of the system is still about 250m out to the east and close to the surface.
What we are seeing here at Botfield and the southern extension zone would be the largest mineralised skarn in NSW.
In addition, Spring also reports that spikes in grade, as seen in the results, demonstrate the presence of a productive hydrothermal porphyry system that can generate ore grade intervals.
“It is a really positive sign to see those spikes in grade to show that one has a productive hydrothermal porphyry system that can give you ore grade intervals and effectively an ore body.
“It is a really positive sign to see those spikes in grade”
It is good to be seeing that endowment and that gold rich nature.”
The ceo says these results generate further confidence due to Trundle’s proximity to the Northparkes Mine, which represents Australia’s second biggest porphyry mine with a metal endowment of about 24 million ounces of gold equivalent.
“The key project in our immediate region that we think is a reference point is Northparkes. It is Australia’s second biggest porphyry mine owned by China Moly and Sumotomo that has about 24 million ounces of gold equivalent metal endowment, and has been in production for over 30 years. It has a series of porphyry systems and skarn deposits and is the most direct comparable.”
Spring also notes Kincora’s next move will be to prioritise a follow-up hole at Botfield in order to confirm the interpreted geophysics of the prospect.
“The obvious one we are prioritising is the follow-up hole at Botfield that we are looking to shortly commence and see if the geophysics and our interpretations are right. We have only skimmed the margin of it and the core is located 250m to the east.”
Meanwhile, the discovery of these ‘significant’ zones has been made following the establishment of an exploration alliance with EarthAI, a vertically integrated metals exploration company focused on discovering metal ore deposits required to build renewable energy infrastructure.
With drilling still ongoing, Kincora announces the program is expected to be completed by the end of April / start of May. Exploration is reported to begin at its Condobolin Project, which hosts 3 prospects within a 2km radius and has returned “good” gold numbers near surface.
Drilling at Trundle is being funded from a raising completed in December 2022, in which the company raised about AU$2.4 million.
Kincora is an ASX-listed with ambition of becoming Australia’s leading pure play porphyry explorer within the nation’s foremost porphyry belt. The company’s Trundle Project is located about 61km northwest of the township of Parkes in central west NSW within proximity to the Northparkes Mine, which is owned by a joint venture (JV) between China Molybdenum (SHA:603993) and Sumitomo Group.
China Molybdenum currently holds the majority 80% interest while Sumitomo holds the remaining 20%.
Images: iStock
Rimfire Pacific Mining (ASX:RIM) has started a diamond drilling (DD) program at its wholly owned Valley Copper Project in central New South Wales.
The company says the 1,000m drilling program has been designed to test a ‘high priority’ copper target, which is indicative of a buried porphyry copper-gold system.
Previous drilling comprising 2 reconnaissance holes (FI2079 and FI2081) undertaken by the company in 2021 further support this belief, with results confirming the prospectivity of the area by intersecting a sequence of ‘strong’ propylitic and epidote-chlorite altered volcaniclastic.
Results from this drilling also returned assays of 10m @ 800 parts per million (ppm) copper (Cu) from 97m within a younger cover sequence which may represent later leakage of copper mineralisation from a deeper source.
Rimfire notes the target also shares geological similarities to the neighbouring 1.96 million tonne (Mt) copper and 2.33 million ounce (Moz) gold Northparkes copper-gold deposit, which is currently operated by the largest molybdenum production company in mainland China, China Molybdenum (SHA:603993).
This tenement currently boasts total measured and indicated resources of 356Mt @ 0.55% copper (Cu) and 0.20g/t gold (Au).
Drilling will comprise 3 reverse circulation (RC) pre-collared diamond holes to determine the source of shallow copper anomalism and is expected to take about 2 months to complete.
Speaking on the start of drilling, Rimfire Pacific Mining Managing Director David Hutton says: “The Valley is a high-priority copper target that we have been wanting to drill for some time.
“The Valley is a high-priority copper target that we have been wanting to drill for some time”
Following the success of our recent capital raising, Rimfire is now in the position to accelerate exploration on our 100%-owned projects including the valley and our exploration team is excited to see what the drilling reveals.”
The company also notes drilling represents the acceleration of its exploration activities on its wholly owned tenements following a capital raise which returned about $1.2 million.
In addition, Rimfire reports it was awarded $185,675 by the Department of Regional NSW, Mining, Exploration and Geoscience group under the competitive, peer-reviewed New Frontiers Cooperative Drilling grant program in January 2022.
Funds from this grant are expected to be used to partially offset the cost of drilling at the Valley project.
Rimfire Pacific Mining is an ASX-listed critical minerals exploration company focused on advancing its portfolio of projects within the ‘highly prospective’ Lachlan Orogen and Broken Hill districts of New South Wales (NSW). The company’s Valley project is located about 5km west of Kincora Copper’s (ASX:KCC) Mordialloc porphyry copper-gold discovery in central NSW and makes up 1 of 2 projects situated west of the townships of Parkes and Orange.
Other assets included in Rimfire’s exploration arsenal include the Cowal Project, Broken Hill Cobalt Project, and Avondale Project in NSW.
Images: Rimfire Pacific Mining Ltd
Kincora Copper (ASX:KCC) has been awarded a $100,000 co-funding grant for the next phase of drilling at the emerging Southern Extension Zone discovery at the Trundle Project.
Kincora reports the grant supports the first direct drill hole to follow up to the interpreted porphyry source that drove 19.9g/t gold and 2.43% copper (in recent hole TRDD032), and the largest mineralised skarn system in NSW.
The NSW government has announced successful recipients for a total of $28 million of funding grants issued under Stream 2 of the Critical Minerals and High-Tech Metals Activation Fund and round 5 of the New Frontiers Exploration Program.
Three Stream 2 critical minerals grants share A$26.5 million to support key infrastructure projects, including Sunrise Energy Metals’ namesake project receiving a $10 million grant.
Addressing the grant, Kincora Copper President and CEO Sam Spring says: “Copper is a key pillar of the NSW Government’s Critical Minerals and High-Tech Metals Strategy. Recent discoveries in both the Macquarie Arc and Cobar Superbasin highlight the significant potential for further new globally significant copper projects within NSW’s Lachlan Fold Belt.
“Copper is a key pillar of the NSW Government’s Critical Minerals and High-Tech Metals Strategy”
We thank the State Government and Geological Survey of NSW for the direct financial support to Kincora and the wider industry via the New Frontiers Exploration Program and $130 million Critical Minerals and High-Tech Metals Activation Fund.
These programs provide material financial assistance and a strong pro-investment and pro-exploration to mining message to all stakeholders. The awards follow a competitive expert panel review process of applications, which were again in high demand. We feel this provides another independent validation of the emerging and very exciting Southern Extension Zone discovery at our flagship Trundle project.
Our next hole at this target will test two settings for the porphyry source of what we believe is the largest mineralised skarn system in NSW, with the size of the skarn representative of the size of the porphyry source.
The next phase of drilling at Trundle is scheduled to commence next month with the company well-funded and positioned to commence this high impact and high conviction drilling program.”
Ore grade copper and gold in skarn has been intersected within the Southern Extension Zone (SEZ) over at least a 330m SSE strike and 225m W-E wide system (and open). The SEZ is a new blind discovery made by Kincora that materially extends the mineralised system at Trundle to the south.
Assay results for most recent diamond core hole TRDD032 has returned a broad ore grade interval with the highest-grade primary mineralisation interval to date the Trundle project -2m at 19.9 g/t gold and 2.43% copper, within a broader zone containing 34m @ 1.45 g/t gold and 0.25% copper, within a total of 104m at 0.59 g/t gold and 0.11% copper from 748m.
Kincora Copper is an active and systematic ASX and TSX-V listed exploration company focused on world-class copper gold discoveries in Australia’s foremost porphyry region, the Macquarie Arc, with the ambition to become the leading pure play porphyry explorer this region.
Write to Adam Orlando at Mining.com.au
Images: Kincora Copper Ltd
Kincora Copper (ASX:KCC) has executed an Exploration Alliance Agreement with privately held vertically integrated metals exploration company Earth AI covering the Cundumbul porphyry project.
The company reports that the success-based alliance seeks to leverage Earth AI’s vertically integrated, proprietary artificial intelligence and machine learning capacity to generate and drill test targets at Cundumbul, located in the central Molong volcanic belt of the Macquarie Arc in Central West New South Wales.
The Exploration Alliance allows for a co-funding model and joint technical committee, whereby Earth AI will have day-to-day management and control of exploration activities, and contribute up to $4.5 million of the total exploration expenditure across the project over a 2-year period with an option to extend for a further year.
Subject to a minimum of 1500m of diamond drilling and a qualifying drilling intersection resulting in a new discovery (as defined within the Exploration Alliance Agreement), Earth AI is entitled to a net smelter return royalty of up to 3% in connection with a to be agreed upon area surrounding the discovery.
Kincora is under no obligation to explore, develop or mine the Cundumbul project during the period of the Exploration Alliance.
However, upon Earth AI successfully drilling a qualifying drilling intersection and having carried out a minimum of 1,500m of diamond drilling, whereafter the second anniversary of the royalty trigger date if no mineral resource has been defined and the annual exploration expenditure in the area of interest falls below US$250,000, Earth AI will have the option to assume operational control and buy all of the royalty tenements that overlap with the area of interest under the royalty deed, for US$1 million cash plus a 2% net smelter.
The agreement will not affect the capital structure of the Company or current ownership in the project, with Kincora and RareX (REE:ASX) retaining the existing 65% and 35% respective interests in the Cundumbul project/license. Rights of first refusal customary for such an ownership and exploration alliance
An initial reconnaissance field trip is planned over the summer to assist refine drill targets.
Cundumbul is located in the ‘world-class’ Molong belt of the Macquarie Arc, 30km south of Boda (>10Moz Au-Eq discovery) and 70km north of Cadia (>90Moz Au-Eq endowment), with previous surface exploration and limited drilling confirming porphyry potential Melbourne, Australia.
Addressing the agreement, Kincora CEO Sam Spring commented: “The Exploration Alliance with Earth AI seeks to accelerate target generation and drill testing at the Cundumbul project. The project is strategically located in Australia’s foremost porphyry region.
Previous surface exploration and limited drilling has confirmed fertile intrusive porphyry systems in both the north and south of the project, located over 10km apart.
“Boots on the ground reconnaissance is expected over the summer to assist advance and refine the drill targeting process”
Earth AI has applied its proprietary cloud-based AI and machine learning technology resulting in priority targets identified for field checking. Boots on the ground reconnaissance is expected over the summer to assist advance and refine the drill targeting process.
The agreement with Earth AI is consistent with Kincora’s exploration strategy to systematically advance, apply industry leading geoscience and drill test our strategically located and district scale project portfolio in the Lachlan Fold Belt.”
Earth AI is a San Francisco headquartered Artificial Intelligence (AI) company that has a vertically integrated metals exploration approach to targeting, testing and verifying discoveries that are required for the electric vehicle and renewable energy revolutions.
The Cundumbul project is approximately 30km south of Alkane’s Boda-Kaiser porphyry project (maiden Boda resource >10Moz Au-Eq and maiden Kaiser resource scheduled 1Q 2023), 25km north of Copper Hill (>3Moz Au-Eq resource) and 70km north of Cadia (>90Moz Au-Eq endowment).
Exploration efforts at the Cundumbul project were last lead by Mitsubishi Materials Corporation during an earn-in period (concluded 2015).
Previous exploration has included mapping, soil sampling, rock chip sampling, induced polarisation (IP), gravity and magnetic geophysical surveying, with more limited follow up auger, RC and diamond drilling.
Mineralised monzonitic intrusions have been identified at both the Bells and Andrews prospects, in the north and south respectively of the Cundumbul project, located over 10km apart.
More recent exploration by Sultan Resources at multiple common prospect mineral systems adjacent to the projects license boundary have returned extensive hydrothermal alteration, anomalous copper and gold, and further confirmed porphyry potential.
Write to Adam Orlando at Mining.com.au
Images: Kincora Copper Ltd
