2024 Drill Campaign Targets High-Potential Zones in Yukon Copper Project
Granite Creek Copper Ltd. (GCX:TSX.V; GCXXF:OTCQB) has initiated its 2024 drill campaign at the Carmacks copper-gold-silver project in Yukon, Canada. Read about how previous shadow drills imply there might be more waiting in the area.
Granite Creek Copper Ltd. (GCX:TSX.V; GCXXF:OTCQB) has initiated its 2024 drill campaign at the Carmacks copper-gold-silver project in Yukon, Canada. The company has mobilized drill crews and equipment to undertake approximately 1,800 meters of core drilling. This drilling will target new areas adjacent to existing high-grade resources, including the Gap, Sourtoe, and Zone 4 target areas. The Gap Target, which lies between the 147 and 2000 S zones, is of particular interest due to its potential as a fault offset of these zones. Previous operators conducted shallow drilling in the area, but Granite Creek's geophysical work suggests that a larger, higher-grade target may be present.
In the company news release, Timothy Johnson, President and CEO, highlighted the underexplored nature of the Carmacks project despite its long history. He noted the potential for new discoveries and resource expansion, citing the 2021 drill campaign that resulted in a 40% increase in contained copper resources. Johnson also emphasized that areas previously reserved for infrastructure under old mine plans are now available for exploration, presenting further opportunities to extend the project's life and increase its net present value (NPV).
Copper's Pivotal Role in the Global Market
The copper market has continued to demonstrate robust growth, underpinned by significant demand from various sectors, particularly those tied to the global energy transition. According to Fastmarkets on August 6, "copper demand growth is supercharged by the energy transition," with consumption from energy-related industries, such as solar energy, wind power, and electric vehicles (EVs), expected to rise significantly. Specifically, the EV sector alone was forecasted to drive copper consumption at a compound annual growth rate (CAGR) of 13.7%, highlighting the metal's critical role in the future of sustainable transportation. Additionally, demand from the wind power sector was projected to increase at a CAGR of 11.2%, further cementing copper's importance in the global shift toward renewable energy.
Couloir Capital maintained their Buy rating on the stock, citing a projected upside of over 520%.Stockhead, on August 16, emphasized that "the copper market is quite a strong market with a great price, and there's a great need for copper demand going forward."
This strong demand has been reflected in the rise of new opportunities for miners, particularly those involved in high-grade copper projects. The article noted that the surge in demand for copper was creating significant opportunities for small-scale miners, allowing them to leverage higher prices amid supply-demand deficits. This environment has been particularly favorable for projects in Canada, where new developments have the potential to fill gaps left by larger operations facing delays and political unrest in other regions.
Chief Strategy Officer of Energy Pathways at The Carlyle Group and economist Jeff Currie, in an interview with Barrons on August 15, also highlighted copper's strategic importance, stating that "copper is involved in all the key investment themes facing the world today." He underscored that copper's connection to green energy and its central role in critical infrastructure made it a key commodity in the global investment landscape. Currie also expressed confidence in the future pricing of copper, predicting that it could reach an all-time high of US$15,000 a ton on a real [inflation-adjusted] basis in the coming years, driven by the ongoing "supercycle" in commodities.
Granite Creek Catalysts
The Carmacks project is situated in a prime location within the Minto Copper Belt, an area known for high-grade copper-gold-silver mineralization. As mentioned by the company, the 177 sq km project boasts over 824 million pounds of measured and indicated copper equivalent metal within a high-grade resource of 36.2 million tonnes. The project's road accessibility and proximity to the Yukon electrical grid further enhance its strategic value.
Granite Creek's 2022 Preliminary Economic Assessment (PEA) identified increased resources and improved recovery rates as key opportunities for enhancing the project's NPV, with recent work by Kemetco Research demonstrating that recovery rates exceeding PEA targets are achievable. The 2024 drill program aims to demonstrate that significant additional resource growth is possible, which could lead to an extended mine life and increased economic returns for the project.
An Analyst's Look At Granite Creek
According to a July 9 research report by Couloir Capital, Granite Creek Copper Ltd. remains a promising base metals explorer with its near-term objective of expanding the Carmacks Copper Project to a billion pounds of copper equivalent. The 2024 exploration program at Carmacks, which includes 1,800 meters of diamond drilling, targets high-potential zones such as the Gap and Sour Toe areas. These targets were identified through geophysical and geochemical surveys, and the exploration is expected to enhance the project's resource base.
Couloir Capital also highlighted the potential economic impact of improved oxide recovery at Carmacks. The recent metallurgical test results demonstrated an increase in oxide recoveries to 88%, which could significantly boost the project's net present value (NPV). The 2023 Preliminary Economic Assessment (PEA) for Carmacks already projected strong returns, and the enhanced recovery rates are expected to further improve the project's economics.
Despite the positive developments, Couloir Capital revised its fair value estimate for Granite Creek to CA$0.22 per share, down from CA$0.42, mainly due to lower peer group multiples and a higher share count. However, they maintained their Buy rating on the stock, citing a projected upside of over 520%. Couloir Capital's analysis underscores the significant potential for value creation at Carmacks, which is driven by continued exploration, resource expansion, and optimization of the mine plan.
Ownership and Share Structure
Streetwise Ownership Overview*
Granite Creek Copper Ltd. (GCX:TSX.V; GCXXF:OTCQB)
*Share Structureas of 8/20/2024Source: Thomson ReutersAccording to Refinitiv, insiders own 6.03% of Granite Creek Copper.
One of the five insiders is the Chairman of the Board, President and CEO Timothy Johnson, with 2.56% or 5.08 million shares.
The next top two, both directors, are Robert Sennott with 1.74% or 3.45 million shares, Michael Rowley with 1.37% or 2.71 million shares.
The company does not have any institutional investors.
Retail investors own the remaining 93.97%.
Granite Creek has 198,27 million shares outstanding and 186.32 million free-float traded shares.
The company's market cap is CA$4.35 million, and it trades in a 52-week range of CA$0.02 to CA$0.06 per share.
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Important Disclosures:
Granite Creek Copper Ltd. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.James Guttman wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.For additional disclosures, please click here.