Chakana Copper Closes $3.0M Upsized Financing with Support from Gold Fields & Rick Rule

• Chakana Copper Corp closed an upsized $3.0M financing with strong support from major shareholders Gold Fields and Rick Rule
• Proceeds to fund minimum 2,400m drilling and advancement of high-grade copper-gold-silver discovery at Soledad Project in Peru
• Financing enables testing of several untested targets on south half of Soledad, including Mega-Gold porphyry target
• Gold Fields increased its equity position from 17.4% to 18.4% with additional investment
• Management team and insiders showing confidence with participation in financing

About Chakana Copper

Chakana Copper Corp is a Canadian-based minerals exploration company focused on advancing the high-grade Soledad Copper-Gold-Silver Project located in Peru. The Soledad Project hosts a high-grade mineral system with significant upside exploration potential. An initial resource estimate outlined 6.73Mt containing 191,000 oz Au, 11.7M oz Ag and 130M lb Cu across seven tourmaline breccia pipes. Over 150 additional exploration targets have been defined, with only 18% tested to date.

Financing Details

In connection with the closing of the second and final tranche of the non-brokered private placement, Chakana issued 54,459,356 units at a price of C$0.04 per unit for gross proceeds of C$2.18M. Together with the first tranche raised in November 2023, total gross proceeds amounted to C$3.0M through the issuance of 75,000,851 units.

Each unit consists of one common share and one 2-year common share purchase warrant exercisable at C$0.06. Chakana retains the right to accelerate expiry if shares trade above C$0.09 for 10 consecutive days.

Strategic Investments Made

Gold Fields exercised its participation right to purchase 15,449,999 units for C$618,000 as part of an investment agreement, increasing its equity position in Chakana from 17.4% to 18.4%.

Renowned investor Rick Rule also participated in the financing through a substantial investment made in the first tranche, after what was described by management as a “thorough geological review of the project and its potential”.

Management and insiders demonstrated confidence by purchasing 3,585,852 units for proceeds of C$143,434 in the financing.

Use of Proceeds

Chakana intends to use the net proceeds of C$3.0M raised to fund a minimum 2,400m drilling program targeting high potential exploration zones on the south half of the Soledad Project. Additional funds will advance exploration efforts on the Company’s recent high-grade copper-gold-silver discovery as well as several untested regional targets within the 6,400 hectare land package.

Key zones set to see maiden drill testing include the Mega-Gold porphyry target and La Joya high-sulfidation epithermal target, among tourmaline breccia pipes. Only US$2M of expenditures are required by Chakana over a 4 year period to earn 100% interest in the Soledad concessions.

President and CEO David Kelley stated: “We especially appreciate additional investments by Gold Fields and Rick Rule after completing a thorough geological review of the project and its potential. The primary use of the proceeds will be to drill several untested targets on the south half of the project, including the Mega-Gold porphyry target”.

Exploration Potential

The Soledad Project provides exposure to both high-grade tourmaline breccia and porphyry related mineralization within a fragmented mineral tenure. However, Chakana has been able to consolidate the land package and identified over 150 exploration targets to date. Just 18% of these opportunities have undergone first pass testing, confirming significant exploration upside remains.

Mineralization is notable for high grades of copper, gold and silver, evidenced in the maiden breccia pipe resource estimate. Additional discoveries have been made since that time, pointing to a large and well-endowed mineral system open in multiple directions. Further drilling has strong discovery potential of entirely new zones across the expanded concession area.

The Mega-Gold target specifically shows strong porphyry style alteration/geochemistry at surface with coincident IP chargeability anomalies. This suggests the upper levels of a gold-rich porphyry system may be preserved, with obvious scope for a major discovery from planned drill testing. While early days, this target has the potential to be a company maker if initial drilling intersects significant mineralization.

Conclusion

Chakana Copper presents investors with an intriguing exposure optionality to high-grade discovery stage projects, backed by strategic investments from senior gold major Gold Fields. The company has delivered on exploration to date, defining over 150 untested targets while consolidating ground in a prospective region of Peru.

With Gold Fields holding an 18.4% interest and Rick Rule also backing another financing, confidence in the geological upside at Soledad runs high. Their investments speak louder than words about the potential scale of what Chakana is exploring in Peru.

Yet with only 18% of defined opportunities tested with drilling, Chakana offers investors tremendous leverage to exploration success over coming years. A 2,400m maiden drill campaign funded by the recent raise provides investors with plenty of catalysts for potentially substantial share price gains on discovery. Several potentially company making targets will undergo their first ever drill test.

Despite very favorable geology and structure shown in surface sampling, the market is not yet pricing in any chance of exploration success at the Mega-Gold porphyry target or broader Soledad Project area. As drilling kicks off in early 2024, now represents an opportune time accumulate positions while Chakana Copper still trades at a modest C$15M market capitalization. Any drill hole success would likely see substantial share price appreciation from this investor friendly valuation level.