China, Russia, Kazakhstan, Zambia & the DRC are among the world’s Top-10 copper (“Cu“)-producing countries. Typically I weave that worrisome fact into my Cu narrative later on in any given article, but this factor keeps rising in importance as China & the West clash on growing China/Taiwan saber-rattling & escalating trade tensions.
Until recently, national security experts thought China/Taiwan could be a 2027 event, but now all bets are off. And, don’t be fooled by Kazakhstan, Zambia & the DRC, they lean toward China.
Chile & Peru are #1 & #2 in Cu production. However, high elevations, decades-old mines, falling ore grades, rising costs, water scarcity & local opposition plague S. American mining.
Copper is indispensable for decarbonization, EVs, renewable energy plants, grid expansions & 5G/6G wireless. Not to mention the “Internet of Things,” data centers, Cloud/AI, supercomputing, robotics, crypto-currency mining, smart homes/cities, and more. Citi, Goldman & Robert Friedland say that $6.80/lb. is a reasonable possibility next year.
Even a move to $5.50/lb. would attract tremendous attention, yet that’s only 6% above the all-time high of $5.20/lb. notched less than three weeks ago. Combining Cu with gold (Au) / silver (Ag) in a junior miner’s portfolio is good because their prices typically move independently. This cycle, all three are doing well.
Au sits at ~US$2,294/oz. There are numerous reasons to believe that Au is poised for a run above $2,500/oz. (incl. investment bank forecasts), but most important is central bank purchases. On a per-capita basis, China’s central bank holds less than 10% as much Au as the U.S.
China has been exiting U.S. treasuries, and BRICS countries are following. Au is one of the very few large, liquid, safe alternative markets. Ok, anyone who’s read this far is presumably bullish on Cu & precious metals… How can one get positioned to benefit? A favorite junior of mine is Prismo Metals (CSE: PRIZ) / (OTCQB: PMOMF).
Last year, a decent amount of work was done on its 5,300-hectare Los Pavitos Au project in Sonora, Mexico. The best result from a maiden drill program was 6.7 meters of 10.2 g/t Au + 47 g/t Ag. Please see the new corp. presentation for details.
Importantly, a new zone with several structures was identified & sampled in the previously unexplored NE portion of the property where surface sampling yielded up to 1,130 g/t Ag, + 1.33 g/t Au. CEO Alain Lambert and his expert technical team will circle back to Los Pavitos later. A more pressing opportunity is Prismo’s 1,420-ha HOT Breccia project in Arizona.
An AI-powered target generation company is crunching the data, including last year’s ZTEM survey that delineated a very large conductive anomaly directly beneath breccia outcrops. AI-assisted modeling aims to point at where, and at what depth, to drill.
Drill permits are expected this month for a 5,000-meter program of five holes. Each hole will take about a month. After raising funds to drill, initial results should start flowing by October. Management plans to twin or deepen one or more of the historical holes.
Importantly, management expects to hit mineralization and learn a lot about the prospective orebody with these initial five holes. The project has excellent infrastructure near paved roads & power lines, and 2 km from the Hayden complex with a flotation plant & smelter.
CEO Lambert, newly minted President Steve Robertson, Chief Exploration Officer Craig Gibson & Tech. Advisor Dr. Peter Megaw say that HOT Breccia has the three things most needed for a HOT prospect… See bios below.
First, a strong project, second, an excellent team of managers, board members & advisors, and third, a tailwind boosting underlying commodity prices. HOT Breccia enjoys all three and is housed in a Company valued at just $9.5M (C$0.21/shr.). The option value alone on HOT Breccia is arguably worth more to a Major than that.
HOT Breccia is in the heart of one of the world’s best places for monster deposits –> the prolific Arizona Copper Belt between Tucson & Phoenix, Arizona. Please take a look at the map. Freeport McMoRan, BHP, RIO Tinto, Grupo Mexico (Asarco), Hudbay & Capstone Copper have mines and/or development projects fairly nearby.
Asarco’s Hayden complex is a few km to the north, and the past-producing Christmas mine is within 5 km. HOT Breccia may host similar mineralization, as the same productive geologic units that host high-grade Cu skarn mineralization have been found.
Freeport recently reported 402M tonnes of 0.39% Cu, 0.06 g/t Au + 1.0 g/t Ag (~3.9B lbs. Cu Eq.) at Christmas and is reportedly looking to restart the mine. Readers should note that most surrounding mines/projects have > 1 billion tonnes of mineralization.
HOT Breccia benefits greatly from Kennecott’s seven drill holes from 1972 to 1981, and two by Phelps Dodge on/near the current property. Several Cu intercepts reported 1+% Cu & elevated zinc.
Robertson explains that given prevailing drill technology, deep holes like these in the 1970s & 1980s were ambitious, demonstrating Kennecott’s & Phelps’ high conviction in the target. And, those promising holes were drilled BEFORE BHP’s / Rio Tinto’s globally significant Resolution project (~40 km to the east) was discovered.
A Phelps Dodge hole returned 387 m of variably mineralized skarn with several intercepts of 1%+ Cu, incl. a high of 3.16% Cu. Please see new corp. presentation for details. Why wasn’t 1%+ Cu aggressively pursued?
Phelps & Kennecott were giants with many Tier-1 assets, 1% Cu did not stand out 40-50 years ago when mines like Escondida, Olympic Dam & Grasberg were being discovered.
President Robertson notes that multiple exploration techniques, incl. drilling & the recent ZTEM study, plus samples thrust to the surface, provide ample evidence of one or more substantial deposits waiting to be found. Drilling this year will be impactful.
HOT Breccia is thought to have very similar host rocks and a very similar structural setting to several mines on the map, including Resolution. Using exploration & drilling technologies that have improved quite considerably in the past 40-50 years, HOT Breccia is a tremendous target with a lot of eyes on it.
Another prized project is Palos Verdes, surrounded by strategic partner Vizsla Silver, (C$402M market cap, 9% owner of Prismo). Vizsla owns a prominent portion of Mexico’s Panuco District, incl. a project with an Indicated + Inferred resource of 215M Ag Eq. ounces.
Prismo’s best drill intercept to date is a half meter of 102 g/t Au + 3,100 g/t Ag. At spot prices, that’s ~10,750 g/t Ag Eq. OR 143 g/t Au Eq. Although too early to have an estimate on Prismo’s property, one can’t rule out millions of Ag Eq. ounces based on data obtained to date + analog deposits –> most notably Vizsla’s neighboring resource.
The timing could not be better for Prismo Metals (CSE: PRIZ) / (OTCQB: PMOMF) to soon be drilling five high-profile holes in Arizona’s world-famous Cu belt, surrounded by the likes of; BHP, Rio Tinto, Freeport & Grupo Mexico.
Disclosures: The content of this article is for information only. Readers fully understand and agree that nothing contained herein, written by Peter Epstein of Epstein Research [ER], (together, [ER]) about Prismo Metals, including but not limited to, commentary, opinions, views, assumptions, reported facts, calculations, etc. is not to be considered implicit or explicit investment advice. Nothing contained herein is a recommendation or solicitation to buy or sell any security. [ER] is not responsible under any circumstances for investment actions taken by the reader. [ER] has never been, and is not currently, a registered or licensed financial advisor or broker/dealer, investment advisor, stockbroker, trader, money manager, compliance or legal officer, and does not perform market-making activities. [ER] is not directly employed by any company, group, organization, party or person. The shares of Prismo Metals are highly speculative, and not suitable for all investors. Readers understand and agree that investments in small-cap stocks can result in a 100% loss of invested funds. It is assumed and agreed upon by readers that they will consult with their own licensed or registered financial advisors before making investment decisions.
At the time this article was posted, Prismo Metals was an advertiser on [ER] and Peter Epstein owned shares and/or stock options in the company.
Readers understand and agree that they must conduct due diligence above and beyond reading this article. While the author believes he’s diligent in screening out companies that, for any reason whatsoever, are unattractive investment opportunities, he cannot guarantee that his efforts will (or have been) successful. [ER] is not responsible for any perceived, or actual, errors including, but not limited to, commentary, opinions, views, assumptions, or reported facts.
