In a May 20 research note, Intrynsyc Capital Corp. reported it initiated coverage on Kodiak Copper Corp. (KDK:TSX.V), a Vancouver-based junior explorer that is advancing its MPD copper-gold porphyry project in British Columbia's Quesnel Trough copper belt. Kodiak Copper also owns the Mohave project in Arizona, at which historical drilling has been done.
Intrynsyc presented its investment thesis on this mining company. The bank highlighted that Teck Resources saw fit to invest in Kodiak Copper and already captured a 9.9% share via a CA$8 million charity flow financing.
"Kodiak Copper offers exposure to high-grade copper-gold porphyry potential based on recent results [and], in addition, significant exploration upside as a developing porphyry copper story with additional porphyry centers yet to be tested," Intrynsyc wrote. "The company's current market cap of about CA$78 million indicates the significant upside."
Recent encouraging results are from 2019 and 2020 drilling at MPD, a combination of three properties, Man, Prime and Dillard. In 2019, Kodiak Copper discovered the Gate zone via hole MPD-19-003, which showed 102 meters (102m) of 0.53% copper and 0.16 grams per ton (0.16 g/t) gold. In 2020, hole MPD-20-004 returned 535m of 0.49% copper and 0.29 g/t gold, or 0.76% copper equivalent.
Drilling had been done between 1966 and 2014 by different operators, a total of 129 holes over 25,780 meters, but never below 200 meters and never as a single project. Those efforts, though, Intrynsyc noted, derisk the current campaign and give Kodiak Copper "a head start on exploration and a wealth of knowledge to refine ongoing targeting." The program Kodiak has underway, fully funded, is for 30,000 meters of drilling.
Also working in Kodiak Copper's favor, Intrynsyc noted, is MPD's location, in the alkalic copper-gold porphyry-rich Quesnel Trough, a tier one jurisdiction hosting several projects and mines, including Copper Mountain, Mount Milligan and New Afton. Also, MPD is close to infrastructure, affording it year-round and low-cost exploration.
Given the geology of the property and the belt, Intrynsyc purports that more porphyry centers exist on the property and, potentially, additional deposits, the latter in the untested porphyry centers of Man, Prime, Dillard and Dillard East.
"MPD screens as a rare opportunity underpinned by a combination of all the components an acquirer looks for in investment opportunities," Intrynsyc wrote.
The report noted that Kodiak is backed "by John Robins' Discovery Group, founded by Chairman Chris Taylor (President and CEO of Great Bear Resrouces), and led by Claudia Tornquist (former GM at RIO Tinto and former VP Business Development at Sandstorm Gold)."
The team backing Kodiak Copper, Intrynsyc pointed out, has "shown the ability to raise capital at higher prices (nondilutive) while protecting their tight share structure and attracting strategic investors such as Teck."
Intrynsyc concluded, "We consider Kodiak Copper an emerging player that is hitting its stride at the perfect time of the cycle. We believe the company is the next go-to story in the base metals sector and poised to build value via the drill bit."[NLINSERT]
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Intrynsyc Capital, Kodiak Copper Corp., May 20, 2021
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