Copper is on the rise and South America has bucketloads of it
BHP is looking to acquire fellow mining giant Anglo American – which has major copper operations in Chile and Peru
ASX juniors seek to capitalise on intense interest in the region
Copper is on a heater at the moment as demand for the red metal soars toward US$10,000/t – with some analysts pegging it to usurp the all-time-high of ~US$10,700/t set in 2021.
Stockhead’s own mining guru Josh Chiat says the desire for copper is forecast to remain strong, based on renewable energy tech, batteries and EV production growth – cars that use much more copper wiring than combustibles.
Marry that idea with the fact South American nations hold large swathes of untapped copper mineralisation and have been positioning themselves recently as highly attractive mining jurisdictions.
It’s no wonder then, that when the world’s largest miner, BHP (ASX:BHP), attempts to snap up London-based major Anglo American – which has stakes in huge copper reserves in Chile and Peru – the rest of the sector’s ears start to perk up.
In an effort to also become the world’s largest copper producer, the Big Aussie just lobbed – and got rejected for – a $60bn bid to buy the company in what would’ve been the largest mining deal on record, just throwing shade over Glencore’s $59bn acquisition of Switzerland’s Xstrata back in 2012.
However, there are plenty of indications that BHP will return to the table with an upgraded offer.
If BHP wins the day it will notably add a 60% stake in Peru’s Quellaveco and a 44% stake in Chile’s Collahuasi copper mines in South America, adding to its own majority slice of the giant Escondida mine nearby.
That news has ASX juniors on the continent salivating over their own copper potential, in a region where there’s been a lack of exploration in the past few years.
Who’s charging down copper in South America?
One of those is Firetail Resources (ASX:FTL) operating at the southern end of Peru’s high-grade copper district where big hitters such as Vale, BHP, Rio and Newmont all have major operations.
Assays from maiden drilling at its Cumbre Coya target at Picha recently confirmed the continuation of copper mineralisation over 170m, with the strike open in all directions and at depth.
“We continue to be excited about the potential at Picha, and these latest results are a validation of all the hard work by the team in advancing this project,” FTL exec chair Brett Grosvenor says.
“Work continues on site as we move into the latter part of the drill program, and we eagerly await the next results to further develop our understanding of this system.”
On Chile’s coastal copper belt, Culpeo Minerals (ASX:CPO) has boosted its stake in the Lana Corina copper project up to 50%, straight on the back of acquiring an 80% interest in Fortuna, another highly-prospective copper project 10km to the north.
“2000m of drilling is now underway to follow up on high-grade copper and molybdenum mineralisation,” CPO MD Max Tuesley says.
“We’re targeting what we’ve identified as a 3km-long corridor of prospectivity between Lana Corina and Vista Montana and expect to likely double the mineralised footprint through this latest diamond drilling program.”
Assay results are expected in the next 4-6 weeks.
With its advanced 798Mt at 0.45% Cu Costa Fuego copper-gold project, also in Chile, Hot Chili (ASX:HCH) is showing a lot confidence in its development plans, having just rattled the tin for up to $29m which the company says will fund the next 18 months of exploration and development.
The copper hunter has an all-encompassing approach towards its foray into the region, focusing on desalination water supply studies, an MoU signed with the nearby port and a recent 25% increase of Costa Fuego with a $4m acquisition of the close by Domeyko tenements.
Discussions with potential development partners, a pre-feasibility study, expansion drilling and exploration and an environmental impact study across the tenements are ongoing.
Southern Hemisphere Mining (ASX:SUH) is in-country too, proving up its Llahuin copper-gold tenure just a stones-throw (8km) from Pucobre’s US$490m El Espino copper-gold mine currently under construction.
The infrastructure being implemented for El Espino, SUH says, significantly de-risks Llahuin, which has a current resource of 169Mt at 0.4% copper.
The explorer is in the midst of a drill program to test multiple targets so it can increase the resource base to support a 25-year mine life.
Across to Argentina and Belararox (ASX:BRX) is notched to the same belt as such as Filo Mining Corp’s C$3.3bn 644Mt Filo Del Sol mine that is backed by BHP, as well as the Los Helados and Potro Cliffs projects being developed by TSE-listed NGEx Minerals.
Its early-stage Toro Malambo Tambo (TMT) project has highly prospective epithermal and porphyry potential for copper, gold and molybdenum, where current exploration is focused on 12 high-priority targets across the landholding.
Rock chips sampled from the targets reached grades of up to 1.41% copper, 2.49ppm gold, 484ppm silver, 20.9% zinc and +20% lead.
“These assay results confirm our geological observations that we are in the epithermal environment at Toro Central and South, and deeper, in the high levels of a porphyry system in Toro North,” BRX exploration director Argentina Jason Ward says.
“Fieldwork continues at Tambo Sur, after which we will re-rank our projects in order to plan our upcoming drilling program.”
In Brazil’s Goia State, Alvo Minerals (ASX:ALV) is about to kick off another round of exploration at its Palma VMS copper-zinc find, drilling into multiple and completely untested targets that aim to replicate the success and add to the existing C1 and C3 prospects, which have a combined 4.6Mt at 1% copper and 3.9% zinc resource with silver and lead to boot.
An initial 5000m of diamond drilling aims to update that resource at Palma’s district-scale tenement package.
“Our team has worked in the background over the past 18 months, bringing these new prospects to a point where drilling is the next logical step to confirm a discovery,” ALV MD Rob Smakman says.
“Our broader exploration model at Palma has always been to make discoveries of high-grade copper and zinc deposits on our district scale land package in a proven VMS belt. We believe this puts Alvo in a unique position as a junior explorer.”
And in southern Ecuador, Titan Minerals (ASX:TTM) and its three copper and gold projects have attracted the interest of Gina Rinehart’s Hancock Prospecting with a farm-in deal that could be worth up to US$120m for an 80% stake in its flagship Linderos project.
At Stockhead, we tell it like it is. While Hot Chili, Firetail Resources, Alvo Minerals, Belararox, Culpeo Minerals and Southern Hemisphere Mining are Stockhead advertisers, they did not sponsor this article.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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