viewArc Minerals Limited

Arc Minerals might have hit major copper prospect at Cheyeza


  • Several new anomalies discovered at the Zamsort project
  • Drilling of Cheyeza hit significant copper grades near surface
  • Assay results so far have been consistently strong

Quick facts: Arc Minerals Limited

Price: 3.27 GBX

Market: AIM
Market Cap: £32.07 m

Given that we are still in the exploration phase ... results once again exceeded all our initial expectations, showing significant, relatively shallow, high-grade intersections of copper as well as good continuity of mineralisation.

Nick von Schirnding, executive chairman

What Arc Minerals does

Arc Minerals Ltd (LON:ARCM) is an AIM-listed explorer focused on copper, cobalt and gold projects in Africa.

What it owns

Assets include the Zamsort copper-cobalt project in Zambia, the Casa and Misisi projects in the Democratic Republic of Congo and the Sturec gold project in Slovakia.

How it's doing

In November, Arc Minerals Ltd (LON:ARCM), reported more near-surface, high-grade copper assays from its maiden diamond drill exploration programme at the Cheyeza East target in Zambia.

Among the highlights were 1.44% copper over 20 metres from a depth of 34.5 metres and 1.2% copper 14 metres from a depth of 38 metres.

Previous holes at Cheyeza had already indicated copper near the surface in good quantities.

The first hole showed 3.94m at 0.72% copper, while in the second there was 1.05% over 25m, which included some bonanza grades.

Cheyeza is a target estimated to be around 3,000m by 800m in size.

What the boss says: Nick Von Schirnding, chairman 

“It is becoming clear that we are sitting on a potentially significant economic prospect - and one that seems to be expanding. 

"A number of holes such as 27, 28 and 45 are to the northwest and southwest of the high-grade zone already identified and bodes well for delineating a significant resource. 

"We have commenced a study to supply the Kalaba plant with material from Cheyeza East which is very exciting. 

"To date over 75% of holes drilled at Cheyeza have shown mineralisation."

What the broker says; SP Angel

SP Angel is house broker and a big fan of Arc Minerals due to its potential for a major copper discovery at Cheyeza East in Zambia.

"The potential value of a significant copper discovery is likely to be a significant multiple of Arc’s current market capitalisation.

"We expect the market will recognise the value of the Cheyeza East discovery on the publication of further drill results and resource estimation.

"Other significant discoveries in Zambia in recent years include Sentinel in 2014 with 939mt grading 0.49% copper just 40km away from Kalaba and is producing >190,000tpa of copper.

"Lumwana which is 100km to the east also has a reserve of 758mt grading 0.51% copper and is producing >116,000tpa of copper.

"Management recently reported on its first commercial sale of 15t of copper concentrate from the Kalaba process plant which serves to substantially de-risk the project from an investor perspective and brings some cash flow into the business.

In conclusion, while the sale of 15t of copper concentrate should net something over $80,000 it is the first step towards significant cash flow if high-grade copper is trucked from Cheyeza East.

Inflexion points

  • Cheyeza and Lumbeta are shaping up to be very promising targets 

  • Assay results from more shallow holes at Cheyeza to confirm potential with deeper drilling to test the extent of mineralisation

  • Potential for early cash flow from high-grade oxide deposits

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