Doré Copper Mining Corp, which listed on the TSX Venture Exchange in December 2019, is quickly establishing itself as a copper-gold explorer and developer in the Chibougamau area of Québec, Canada.
The company has consolidated a large land package in the prolific Lac Dore/Chibougamau and Joe Mann mining camps that has produced 1.6 billion pounds of copper and 4.4 million ounces of gold. Doré Copper’s land package includes 13 former producing mines, deposits and resource target areas within a 60 kilometre (km) radius of the company’s 2,700 tonnes per day (tpd) Copper Rand Mill.
The company’s current focus is to implement a hub-and-spoke development strategy by advancing its key high-grade coppergold Brownfield projects towards a restart of operations. It’s overall goal is to achieve an annual production of 60 million pounds of copper equivalent (or 100,000 ounces of gold equivalent).
WATCH: Doré Copper expands mineral resource estimate for Corner Bay, expects PEA by beginning of 2022
Doré Copper plans to deliver a preliminary economic assessment (PEA) of its hub-and-spoke model in January 2022. The company is currently completing its 2021 drilling program of 50,000 meters (m) on its properties in the Lac Doré and Chibougamau area of Québec.
Proactive sat down with Doré Copper Mining CEO, Ernest Mast to learn more about the company.
Proactive: Doré Copper has Brownfield assets in a top mining jurisdiction, with established mining infrastructure. Can you tell us more about the opportunities for the company?
Ernest Mast: So the opportunity lies in the fact that we have high-grade copper-gold deposits in the great mining jurisdiction of Québec. These are Brownfield projects and, therefore, the capital cost to restart operations is much lower than a comparable Greenfield project. We have mining infrastructure, direct access to roads and power and more importantly we have a centralized mill.
Copper and gold markets are very strong currently. Copper prices are at all-time highs and look to be strong for the foreseeable future. And that's another great advantage we have, being in such strong commodities with advanced exploration projects that we can develop and permit over the next 2 years and be in production in about three years.
You use a hub-and-spoke development strategy, can you explain that to us?
A hub and spoke operational strategy utilizes a centralized mill (the “hub”), and then there are a number of mines (the “spokes”) feeding that mill over the life of mine. What that allows us to do, having a centralized mill, is to take advantage of the mineral inventory in the region where a number of mines can start at different times and feed our mill.
It is about applying economies of scale, otherwise small deposits would not be economic on their own.
The company recently announced a significantly expanded Mineral Resource Estimate for its flagship Corner Bay high-grade copper-gold project. What are the next stages for this?
The Corner Bay project will be the cornerstone of our restart scenario with the hub and spoke strategy. We foresee Corner Bay operating over a period of at least 15 years, and would complement Corner Bay with some of our other deposits in the camp (Devlin and Joe Mann in the near-term).
The next steps for Corner Bay will be continued exploration. The deposit now totals 7.2 million tonnes at 3% copper (announced on October 6), and we are optimistic that it can get to 10 million tonnes. We're currently in that Exploration Program and over the course of next year we're going to be doing infill drilling to upgrade the resource to the indicated category and then, upon finishing the PEA, we would start a feasibility study in early 2022, which will look at the optimum mining rate for Corner Bay.
How are the company’s other projects progressing at Joe Mann, Cedar Bay, and the more recently acquired Norbeau property?
At the Norbeau property, we just completed a 30 hole drill program. Most of the holes were shallow as we're following up on a couple of known veins - the New Vein and the Sharpe Vein - and we're awaiting the results quite anxiously.
Another deposit worth mentioning is the Devlin deposit, located 10 km west of Corner Bay where we just updated the resources to 1.26 million tonnes at 2% copper (October 14, 2021), which will be included in the PEA and has some operating synergies with Corner Bay. Joe Mann will also be included in the upcoming PEA and we announced a resource of 133,000 ounces of gold last July.
What about other possible acquisition opportunities? Would you look to expand your projects?
It is a possibility. The Chibougamau area is in the eastern portion of the Abitibi Greenstone belt and surrounding our projects are over 20 mineral occurrences. A number of junior mining companies are currently exploring in the region and it's very likely that if they were to find something that was not large enough to justify a new mill, we would have discussions with them in terms of trucking the ore to our mill or potentially acquiring the company or deposit to further expand our resource base.
What do you think you bring to the company as its CEO?
I bring over 25 years of Mining experience. I've worked throughout the Americas in copper and gold, underground and open-pit mining. I am a co-founder of Dore Copper and have invested my own money in this company. I am very excited with the portfolio of quality properties that we have been able to assemble under one company.
I also speak french which is a big plus when working in Québec.
What should investors in Doré Copper expect in the near to medium term?
They should look first for continued success with our drilling program at Corner Bay and then we will have the results of the PEA in January 2022, which I expect will be very good. Then the company will be embarking on a feasibility study and permitting so we can target a start-up in 2024.
How is the company's financial cash position?
The company is in great shape with a working capital of approximately $18 million. So we're fully financed through the PEA and well into the feasibility study and the company currently has zero debt.
So what's the value opportunity for the investor?
We can look at it in a couple of different ways. The first way is the value of the infrastructure we have in place - replacement estimated cost of at least $200 million, which far exceeds the current C$60 million market cap of the company.
Another way to look at the value opportunity of the company is the fact that we have now well over $2 billion of copper and gold in the ground surrounded by usable infrastructure that makes for a realistic restart scenario Again, if we compare that to the C$60 million market cap, it represents tremendous value for the investor.
Contact the author at jon.hopkins@proactiveinvestors.com