Pan Asia Metals (ASX:PAM) has entered into a six week exclusivity agreement to conduct due diligence on the Rosario Copper Project in Chile, before deciding to proceed with the entering into an option agreement.
The Rosario Project is interpreted as a “highly prospective”, yet underexplored Manto-style copper-silver project. This style of mineralisation occurs throughout the northern parts of Chile and is responsible for historical and current copper production.
Pan Asia, which has a market capitalisation of $15 million, says if it decides to proceed with the three year option agreement, the fee is US$100,000 per year. If the company chooses to acquire 100% of the project, Pan Asia will pay US$2 million to vendors.
Both payments can be paid through 50% cash and 50% shares.
Managing Director Paul Lock says the Rosario Copper Project ticks all of Pan Asia’s boxes, as it lies in an infrastructure-rich setting, with all processing needs nearby.
“It demonstrates peer ground leading copper grades from a large suite of rock chips and it is located in a premier copper producing region which is known for its cost advantages,” Lock says.
“The project has what is needed to gain a position in the lower third of the cost curve. Rosario represents a tremendous opportunity to position PAM with a high-grade, low-cost copper project.
“We view copper as an equally important metal with lithium in the global electrification transition, the supply-demand dynamics are compelling with deficits projected due to declining production and grades, and a lack of new discoveries.”
Speaking to Mining.com.au in a wide-ranging interview, Lock says a commodity needs to “make sense” before it will be included in the company’s portfolio of assets.
Lock adds importantly, the project is not a pivot, it is strategic and has the right fundamentals and offers the company strategic options.
Pan Asia is currently finalising due diligence and will formalise its agreements with the vendor in the coming weeks.
Upon entering into an option over the project, future work will include geochemical sampling, mapping, trenching, and induced polarisation geophysics. This work is expected to delineate drill-ready targets. Drilling will follow at the earliest opportunity.
Pan Asia Metals is a battery metals-focused company with lithium and copper exploration and development projects that lie in Southeast Asia and South America.
Write to Aaliyah Rogan at Mining.com.au
Images: Pan Asia Metals
