This article is a sponsored feature from Mining.com.au partner Faraday Copper Corp. It is not financial advice. Talk to a registered financial expert before making investment decisions.
Faraday Copper (TSX:FDY) is setting an ambitious tone for its Copper Creek Project in Arizona, betting big on aggressive resource growth and substantial value creation.
With a laser-focused strategy to boost its open pit resources in the near term, the junior explorer is digging deep – both literally and figuratively – to unlock the full potential of this underexplored copper-rich region.
The Copper Creek Project is located in the heart of the prolific porphyry copper district in Arizona. It lies at the intersection of a major northwest-trending belt, which includes the well-known copper mines in the Miami-Globe and Ray mining districts.
The 3km-long porphyry deposit, which sits less than two hours northeast of Tucson, so far hosts combined open pit and underground measured and indicated resources totalling 421.9 million tonnes @ 0.48% copper equivalent for 4.46 billion contained pounds. It also hosts a combined inferred resource of 83.6 million tonnes @ 0.36% copper equivalent for 669 million contained pounds.
The copper equivalent resources comprise copper, molybdenum and silver.
But the exploration upside is substantial, according to Faraday, which is working towards the release of an updated resource and updated Preliminary Economic Assessment (PEA) in the first half of 2025.
CEO Paul Harbidge tells Mining.com.au there are over 300 mineralised breccias at Faraday’s flagship project, with just 17 included in the current resource.
“As you’ve seen from our phase-three drilling, the results are confirming that we’ve got more strongly mineralised breccias near surface, and we continue to drill those with the aim of expanding the open pit inventory,” he explains.
“The expectations are that we want to add 30% to the open pit inventory. So that’s probably around 50 million tonnes at or above the resource grade.”
Targeting 30% boost to open pit inventory
The mineralisation at Copper Creek is hosted in breccias located in the hanging wall of two interpreted thrust faults. The one of immediate interest to Faraday is the ‘Holy Joe Fault’, located in the eastern part of the project area and extending for about 6-7km.
“The project has been well drilled within the resource area, but along that structure, outside of the resource, it remains relatively untested. We also see copper exposed at surface along the Holy Joe Fault and this is where we see the potential to grow the open pit inventory through continued exploration,” Harbidge says.
This is what makes it a good target for adding more resources to the open pit, which currently hosts measured and indicated resources of 127.1 million tonnes containing 1.19 billion copper equivalent pounds and an inferred resource of 48.1 million tonnes containing 316 million copper equivalent pounds.
There is also an area of interest in the western portion of the project that shows potential to grow the underground resource.
“On the western side of the property, we’ve got another thrust fault that’s host to breccias and porphyries that have not been previously drill tested, however due to slight regional tilt, we’re higher up in the mineral system. In the field we observe high level alteration and pyrite mineralisation,” Harbidge notes.
“In order to get down to the copper zone, it’s probably around 300m vertical so this is more likely an underground target. Hence, we’re focused on that eastern structure as opposed to the west, but that still offers longer term exploration upside.”
The underground measured and indicated resources currently sit at 294.8 million tonnes containing 3.26 billion copper equivalent pounds, while the inferred resources total 35.5 million tonnes containing 353 million copper equivalent pounds.
“We’ve got a combined open pit and underground resource right now. Our exploration strategy is focused on adding more near-surface resources to the open pit, because that really drives net present value (NPV) in the early years,” Harbidge explains.
“When you’ve got a 30-year mine life and you discount it, you don’t see the value beyond 15 to 20 years. How do we really add value to the project? — By driving the open pit up front. Hence, that is our exploration focus.”
Faraday was originally aiming to complete 20,000m of drilling in its phase-three program, but increased that to 28,000m – with the vast majority of these drill holes planned to be considered in the upcoming resource update.
Importantly, that sets the stage for further resource growth down the track.
The American Eagle area has also been a prolific target for Faraday where near-surface breccias had not previously been drill tested and have resulted in a new discovery at the Banjo breccia with top intercepts of 117.83m @ 1.12% copper and 2.43 grams per tonne silver from 298.00m, including 25.67m @ 1.66% copper and 3.47g/t silver from 378.76m.
Faraday has identified 34 high-priority targets across the Copper Creek Project that provide significant growth opportunities in this underexplored district.
Economic update to showcase enhanced project viability
At the same time, Faraday is further refining the economics of the project as it prepares to deliver an updated PEA in parallel with the resource update.
Harbidge says the aim is to increase both the planned throughput and metal output by 50% each, which he says will significantly add value to the previous study, showing scale and longevity.
The previous PEA, which was completed in May 2023, outlined a post-tax NPV of US$713 million ($1.08 billion) and an internal rate of return of 16%, with significant upside to higher prices.
That was based on a copper price of US$3.80 per pound. Copper prices, however, have strengthened since the initial PEA was released last year and are now hovering around US$4.30 per pound.
A standalone open pit operation from the PEA base case would generate a pre-tax NPV of US$337 million, with a payback of four years and the ability to fully fund the development of a bulk underground operation for a total mine life of 32 years.
All-in sustaining costs were previously forecast to be US$1.85 per pound.
The PEA envisaged annual production of 51,100 copper equivalent tonnes, with peak production reaching 82,100 tonnes in the second year.
This would generate 3.4 billion pounds of payable copper equivalent metal – comprising 3.2 billion pounds of copper, 45.1 million pounds of molybdenum, and 9.7 million troy ounces of silver – over the anticipated life of mine. While gold was not included in the 2023 PEA, it is expected to be included in the upcoming PEA update, generating additional value for the project.
Harbidge says Faraday has also been complementing its aggressive drilling program with additional metallurgical testwork from the new discoveries at Banjo, Prada, American Eagle, and Area 51.
“At the same time, we’ve been continuing with all of our baseline work,” he says.
“We continue to install piezometers in our drill holes to build up a hydrogeologicalmodel. We’re doing all the baseline sampling. We’re doing community outreach and engagement.”
The district is a historic mining hub, with the local community established as a result of the San Manuel Mine that operated for over a 50-year period and was owned by Magma Copper Company before mining giant BHP (ASX:BHP) acquired it.
The San Manuel Mine, which sits adjacent to Faraday’s Copper Creek Project, was decommissioned in the early 2000s due to a low copper price.
The mine, which still has a large underground resource in the Kalamazoo deposit, offers potential synergies with the Copper Creek Project given the already established infrastructure in the region.
Arizona is one of the world’s largest suppliers of copper, accounting for just under 70% of US domestic production.
Fostering community connections
Faraday plans to host the local communities surrounding Copper Creek very soon to provide an in-person update on activities being undertaken at the project.
The Copper Creek property is 16km from the town of San Manuel and 10km from Mammoth.
There are three local communities in the area – San Manuel, Mammoth and Oracle – which Faraday will engage with at the local community hall.
“San Manuel was purpose built for a mine that was close by, but when that closed, it obviously suffered economically,” Harbidge explains.
“We’re going to give the local population an update as to the activities that we’re doing in the field and how we’re advancing the project.”
2024 has proven to be a productive year for Faraday and 2025 is shaping up to be just as busy.
“I would say the key milestone this year has been making new discoveries, which confirm that our theory of significant exploration upside is real,” Harbidge says.
This includes the Banjo discovery where Faraday has confirmed high grades with a core of more than a percent copper that could be mined by open pit.
“We feel that we’ve de-risked the metallurgy as well, that we can bring in a courser grind and that really helps to unlock throughput and reduce operating costs. We’re well on our way to our milestone of increasing the open pit inventory by 30%,” Harbidge adds.
“Then going into 2025, it’s about taking that empirical data, wrapping it up into a resource update, and then delivering the PEA, with the aim of significantly enhancing the economics of the project.”
Write to Angela East at Mining.com.au
Images: Faraday Copper
