Chakana Copper (PERU) - Resource Estimate by Year End to Show Scale

Chakana Copper is a Canadian-based minerals exploration company and through its wholly-owned Peruvian subsidiary, Chakana Resources S.A.C. is currently advancing the Soledad project near Aija, in the Ancash region of the highly prolific Miocene mineral belt of Peru. 

Matt Gordon caught up with David Kelley, CEO, President, and Director, Chakana Copper. David is an economic geologist, and an exploration geochemist with over 25 years of international exploration experience across the Americas, Central Asia, and Australasia. He previously worked for Oz Minerals, Zinifex, Newmont, WMC, BHP, West Mining, and Gold Standard. His educational credentials include a B.Sc. degree in geology from Colorado State University and an M.Sc. degree in geology/geochemistry from the Colorado School of Mines. He previously served as a President for both the Society of Economic Geologists Foundation and the Association of Applied Geochemists. 

Company Overview

Chakana Copper is a minerals exploration company founded in 2011 and headquartered in Vancouver, Canada. The company is listed on the Toronto Stock Exchange (TSX-V: PERU), the OTC Markets (OTCQX: CHKKF), and the Frankfurt Stock Exchange (FRA: 1ZX). Chakana Copper has a current market cap of $30M.

Chakana Copper is a junior exploration company focused in Peru. Its sole asset is the Soledad Project where the company has made significant copper, gold, and silver discoveries in the Ancash province, an active mining district. The company is currently exploring the project for Tourmaline breccia pipes that feature exceptional grades. It has also discovered varying grades of sulphide content in the region. 

This site is ideally located and offers a strong infrastructure along with supporting local communities. The company is carrying out aggressive exploration to publish its maiden resource which is expected by the end of 2021. 

The Copper Market

Following the push towards clean energy production by several governments, copper is trading at a strong price of $4/lb. However, junior and mid-tier junior mining companies are observing a drop in share prices. As the US government is supporting the clean energy initiative without encouraging mining operations in the country, it is expected that the value of foreign mining assets will grow. The 4 mega copper projects in North America are currently put on hold, leading to a significant demand rise for copper sourced through other regions.

The pandemic has also resulted in exceptional growth in the debts that various countries have undertaken. The uncertainty of the covid situation has also impacted investment decisions globally. 

Peru's Economic and Geopolitical Climate

Chakana Copper's team in Peru consists of 100% local hires. The majority of team members are from Lima, Trujillo, and Arequipa. The team has followed strict covid protocols and hasn't had any positive cases so far. 

Peru has observed a strong economic recovery as the mining industry is booming despite covid. In fact, the laboratories in Peru are maxed out on sample submittals and are under planned expansion from 12 to 14 ICP-MS (Inductively Coupled Plasma Mass Spectrometry) units. 

The Castillo administration has shown a strong backing of mining in the country. Peru has a long history in mining, the country has various academic institutions and universities that focus on geology, mining, social and environmental programs. This enables Peruvians to practice their trade and gain employment in the industry. 

Chakana Copper has a permanent staff of Peruvian employees and it has also hired 20 personnel from the local community to expand ground capabilities dealing with reclamation and drill pad construction. A major part of this local community initiative is focused on improving the existing infrastructure. 

ESG Initiatives

Chakana Copper places an emphasis on sourcing locally for its infrastructure development. As part of the company's ESG (Environment, Social and Governance) program, the company has established a policy that outlines numerous initiatives including a textile program with the women's group, a year-long infrastructure improvement plan, a tree planting program, and a community garden program. The company has built 3 community gardens so far and is working with an in-house agriculturalist to expand the types of crops that can be grown and harvested. 

Exploration Findings

The company has drilled 55,000m and discovered 12m of a massive sulphide deposit consisting of 90% copper pyrite. The grade within this interval is 27% copper and 1kg silver. The company has also found 12 massive sulphide intercepts greater than 1m in length. These intercepts occur within 4 of the 6 breccia pipes that are planned as a part of the initial resource. Chakana Copper is anticipating additional discoveries as it moves towards infill drilling. 

The company is currently hosting a well-known Canadian QP (Qualified Person) for its resource estimate. The last of the drill samples are currently being processed in the lab. The company plans to publish data on 61 drill holes that are in various stages ranging from assays pending to samples. 

The resource estimate will include the entire 20,000-25,000m resource definition drilling. It will be based on 6  breccia pipes at a depth of 300m. All the pipes are open at depth, enabling the company to expand the resource in the future. The company has a total of 110 targets on the project, out of which 15 have been tested so far. 6 out of these 15 targets are breccia pipes. The company plans to advance the targets through aggressive exploration and double or quadruple the resource. The resource update is scheduled for publication before the end of 2021. 

Cash Position

Chakana Copper is in a strong financial position with CAD$4.75M in cash flow. The company has halted drilling operations since the resource drilling was concluded. It is working with Andrew Foley, Chief Geophysicist at Gold Fields to carry out orientation surveys. The company is approaching geophysics through gradient array-induced polarization and 3D IP. This process will enable the company to identify breccia pipes and new drill targets. This survey is being carried out on the 110 existing targets along with new blind drill targets. 

Chakana Copper places equal emphasis on both retail and institutional investors as it accounts for 20%-25% of the company's shareholders. The company is looking to demonstrate its well-organized mineral system through the upcoming resource estimate. 

The company has received a growing interest from Royalty and Streaming companies due to the presence of high grades and multiple metals. A collaboration with these partners will provide project financing and the basis for building a mine. 

The company's board recently visited the Beaver Creek conference where it had 30 meetings over a period of 3 days. The presence of Doug Silver, Chairman, and Director, Chakana Copper's board facilitated a major portion of these meetings through his exceptional experience and network in the industry.

To find out more, go to the Chakana Copper Website