Co. Hits High-Grade Metals with Drill Bit
These results, from its flagship project in Spain, bode well for the upcoming mineral resource estimate update and preliminary economic assessment. Read on to learn more.
Emerita Resources Corp. (EMO:TSX.V; EMOTF:OTCMKTS; LLJA:FSE) encountered high-grade mineralization while drilling El Cura, thereby extending this deposit at its Iberian Belt West (IBW) project in Spain, according to a news release.
The company reported the results for two drill holes, EC014, about 600 meters (600m) west of the historical workings, and EC015, 200m east of and at a shallower depth than EC014.
EC014 intersected 11.4m of 4.3% copper, 48.31 grams per tonne (48.31 g/t) silver, and 1.85 g/t gold, the deepest and thickest intercept to date at El Cura. This result extended the deposit 40m downdip.
EC015 intersected 4.6m of 0.6% copper, 2.3% zinc, 1.2% lead, 33.02 g/t silver and 0.65 g/t gold, including 1.5m of 0.9% copper, 6.4% zinc, 3.3% lead, 1.52 g/t gold and 67 g/t silver.
"Mineralization at El Cura occurs as bedded copper-zinc-lead-rich semi-massive to massive sulfides with local overprinting of copper-rich veining that can significantly enrich grades," the release noted.
A historical, noncompliant estimate of the resource at El Cura, as determined from academic publications, is 1,000,000 tons (1 Mt) of 4.2% copper equivalent (Cu eq), noted Clarus Securities Analyst Varun Arora in a May 2023 research report.
Developing Project of Strategic Interest
Emerita Resources Corp. is exploring and developing high-grade, polymetallic deposits in Spain. The company owns a sizable land package in the European Union, about 26,000 combined hectares, in the heart of the prolific Iberian Pyrite Belt, "one of the largest VMS mining camps globally with numerous majors currently operating in the region," Arora wrote after a previous site visit.
Nearby producing mines include Lundin Mining Corp.'s (LUN:TSX) Neves-Corvo, Sandfire Resources Ltd.'s (SFR:ASX) Minas de Aguas Te?idas, Rio Tinto Plc's (RIO:NYSE; RIO:ASX; RIO:LSE; RTPPF:OTCPK) namesake mine and First Quantum Minerals Ltd.'s (FM:TSX; FQM:LSE) Cobre Las Cruces. More than 2 billion tons of ore have been extracted from the belt, home to 250 known deposits today, the company noted in its June 2024 Investor Presentation.
The company's flagship asset, Iberian Belt West, or IBW, encompasses three previously identified volcanogenic massive sulfide (VMS) deposits: La Romanera and La Infanta, which comprise the existing resource and remain open, and El Cura.
IBW's current resource consists of 14.07 Mt at an average grade of 7.63% zinc equivalent in the Indicated category and 4.71 Mt at an average grade of 9.29% zinc equivalent in the Inferred category, according to the company's Fact Sheet.
"With 5% of the resource in the Measured & Indicated category, we believe this is a robust resource," wrote Arora. "We believe the maiden resource confirms our view that IBW will be a mine."
Last month Andalusia's regional government declared IBW of strategic interest and granted it Declaration of Strategic Interest status, according to a news release on July 31, the day a kickoff meeting between Emerita and community officials occurred. The purpose behind assigning the designation is to "streamline the administrative procedures to support economic business initiatives, and thus promote investment and the generation and securing of jobs in the Andalusia region," the company explained.
Earlier this year, Emerita applied for an exploitation license for IBW, marking the company's transition from explorer to developer, the company said. With the application filing, exploration permits are automatically renewed. An exploitation license is valid for 30 years and renewable for up to 90.
About 74 kilometers (74 km) away from IBW is Emerita's other asset, Nuevo Tintillo, prospective concessions over 14,500 hectares that have had little modern exploration. Located on the eastern part of the Iberian Pyrite Belt, this asset is on trend with producing mines in the region.
On the Nuevo Tintillo property are the historical Santa Flora and Nazaret mines, the latter of which produced up to 5% copper.
In June, Sevilla, Spain-based Emerita completed initial drilling, eight diamond drill holes over 4,318m along nearly 4 km of strike, "testing for coincident gravity and electromagnetic anomalies as well as surface showings of mineralization and favorable lithologies," the latest release noted.
Upon drilling, the company encountered disseminated zinc-lead mineralization in hole NTW001. A standout intercept was 0.72% zinc and 0.36% lead over 2.2m, including 2% zinc and 1.09% lead over 0.5m.
Hole NTW007 showed stockwork copper-enriched mineralization, returning 0.4% copper over 1.1m and 0.2% copper over 3m.
Emerita has been engaged in a legal dispute over the tender of another project, Aznalc?llar, a past-producing property, on the same belt as IBW and Nuevo Tintillo, which hosted the Aznalc?llar and Los Frailes open pit zinc-lead-silver mines.
Regarding this matter, a trial date is scheduled for March 3, 2025.
"We believe the court proceedings to date are pointing to the potential for a favorable outcome for EMO," wrote Arora.
Higher Copper Prices Anticipated
Expected market growth, increasing demand driven by the green energy transition, a looming supply deficit, and strong prices all make copper "a generational investment opportunity," reported a July 26 Kitco News article.
According to Fortune Business Insights, the global copper mining market is expected to reach US$11.86 billion (US$11.86B) in value by 2032, up from US$9.26B in 2024 and reflecting 3.13% compound annual growth rate.
Recent consumption and supply statistics indicate a likely supply shortfall. According to Benchmark Mineral Intelligence, global copper consumption is projected to reach 28 Mt this year, Mining.com reported. However, global copper supply from mine production was only 22 Mt in 2023, according to the U.S. Geological Survey. Consumption is expected to increase further to 38 Mt by 2032, BMI noted.
Over the past few weeks, the copper price has fallen, noted Marin Katusa of Katusa Research in an August 7 article; however, generally, over the past five years, it "performed very strongly, up 58%. This incentivizes producers to transact and develop new assets."
Two events bode well for copper, Katusa wrote. One is Chinese efforts to spur economic investment in real estate and infrastructure. The caveat is that the effect on copper may take some time to be realized. The other catalyst is continuing production misses by state-owned Chilean copper miner CODELCO.
"This poses a serious issue for the market and a potential opportunity for higher prices if CODELCO production continues to lag expectations," added Katusa.
Citi Research analysts expect the copper price will recover from recent pullbacks, returning to US$9,500 per ton over the next three months or so, Reuters reported on July 26. Citi forecasts the price will hit US$11,000 per ton by early 2025.
"The bank attributed the expected rally to a recovery in global manufacturing sentiment driven by anticipated Fed rate cuts and expected inventory draws and deficits in H2/24," Reuters wrote.
Because copper is in a bull market, this current heavy correction "is viewed as presenting an opportunity to buy copper itself or various copper stocks that have dropped back in sympathy with copper," wrote Technical Analyst Clive Maund on July 25.
Reid I'Anson, senior commodity analyst with Kpler, recommends staying long in copper investments, he told BNN Bloomberg on July 25, despite anticipated short-term volatility, due to the metal's extensive use in electric vehicles and artificial intelligence technology.
"Over the long run, we are still bullish. We think copper looks like a good investment," l' Anson said.
The Catalysts: Further Project Derisking
Emerita is continuing to advance both IBW and Nuevo Tintillo concurrently.
At IBW, drilling with two rigs is ongoing at El Cura, where the company aims to define the limits of mineralization. As well, downhole geophysical surveys are being conducted to check for continuation of the massive sulfides downdip and along strike.
Thus, additional drill results, an updated mineral resource estimate of IBW, and a preliminary economic assessment of the project are expected in the near term.
Regarding Nuevo Tintillo, next steps involve integrating the latest exploration findings with the available regional data and interpreting the whole of it geologically to determine how best to proceed, the company said.
As for Aznalc?llar, Emerita should learn in Q1/25 the outcome of the trial. A resolution in its favor, Arora wrote, would be a "a critical rerating milestone."
Streetwise Ownership Overview*
Emerita Resources Corp. (EMO:TSX.V; EMOTF:OTCMKTS; LLJA:FSE)
*Share Structureas of 7/31/2024Source: Emerita Resources Corp."We believe the big prize for EMO will be the awarding of the world-class, past-producing Aznalc?llar mine," the analyst wrote in 2021.
Ownership and Share Structure
Reuters provided a breakdown of the company's ownership and share structure, where management and insiders own approximately 5.13% of the company.
According to Reuters, Michael Lawrence Guy owns 1.54% of the company, David Patrick Gower owns 1.12%, Joaquin Merino-Marquez owns 0.84%, Catherine Stretch owns 0.65%, and Marilia Bento owns 0.4%.
Institutions own 1.19% of the company, Reuters reported, including Merk Investments LLC with 1.11%.
According to Refinitiv, there are 247.39 million shares outstanding with 234.7 million free float traded shares, while the company has a market cap of CA$180.54 million and trades in a 52-week range of CA$0.23 and CA$0.78.
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Important Disclosures:
Emerita Resources Corp.is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. 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.