Maurice Jackson: Joining us for conversation is Tim Johnson, the CEO of Granite Creek Copper Ltd. (GCX:TSX.V; GCXXF:OTC).
It is always a pleasure to speak with you as you have some important updates for shareholders regarding potential resource development and mineral processing opportunities, along with the latest developments on the ongoing 10,000-meter drill program being carried out on the flagship Carmacks project. Before we begin, Mr. Johnson, please introduce us to Granite Creek Copper and the opportunity the company presents to shareholders.
Tim Johnson: Thank you. Well, Granite Creek Copper, we're a TSX-listed company. We launched the company in January of 2019, but in a very short period of under 24 months, we've gone from an early-stage copper play to a resource company with aggressive plans to grow that resource. And as you pointed out, we've just launched a 10,000-meter drill program. And we brought in an engineering firm to look at, once we've got those resources growing, how we're ultimately going to process them.
Maurice Jackson: Mr. Johnson, take us to the Yukon and get us acquainted with your flagship Carmacks project and some of your neighbors.
Tim Johnson: Granite Creek Copper is located in the Minto Copper Belt, which is world renowned for high-grade copper hosting the Minto Mine, about 35 kilometers north of us, that was the highest-grade open pit in the world and now they're underground and they still have a fairly good grade from a global perspective.
We're also just down the road from the Casino Project operated by Western Copper. And that one just had a major investment by Rio Tinto. So we're in a very good place, we've got very good neighbors, very good infrastructure. We're within about 12 kilometers of grid power and paved highway. And we've got road access right into the middle of our project. All of our drilling was accomplished with skid-mounted drills. Great project, great infrastructure, great jurisdiction. We tick a lot of the boxes.
Maurice Jackson: You certainly do. And Rio Tinto is now in the neighborhood; tell us more.
Tim Johnson: That's right. They took an 8% interest in Western Copper, which is good to see another major alongside Teck and the other big companies having a look at the Yukon and recognizing the potential for resource growth and resource development.
Maurice Jackson: We referenced the potential for research development and mineral processing opportunities at the Carmacks Project. Before we take a step forward, let's remind everyone about the PEA numbers released in 2017 on the Carmacks, which hosts both oxide and sulfide copper, along with gold and silver.
Tim Johnson: The current measured and indicated resource, as referenced by that 2017 PEA, is just under 24 million tons grading 0.85% copper. And the gold and silver credits, when you add those in, puts us at about a 1.3% copper equivalent. Again, pretty high grade for the industry. Now that is split about two-thirds oxide material and one-third sulfide, giving us just under 450 million pounds contained copper.
But the 2017 PEA only referenced the oxide portion. So that contemplated roughly a nine-year mine producing roughly 30 million pounds of copper a year, but we see the potential to significantly grow that resource primarily in the sulfide. We see the real potential here is the sulfide, which could be two to three times larger than what the current resource is.
Maurice Jackson: Mr. Johnson, in layman's terms, what is the difference between oxide and sulfide?
Tim Johnson: So most mineral deposits, the original deposition of mineral with sulfide, and then over time, a portion of that sulfide has been oxidized by weathering. And what this gives you is different minerals that are processed differently. The oxide is amenable to leaching, so it can be extracted with the leaching technology.
And then you can produce cathode copper or a final product at the mine site. For example on an oxide operation, you produce a product that is directly sellable to the end copper users. With a sulfide operation, however, you will produce a concentrate that will run between 30% and 40% copper that then needs to be delivered to a smelter for final processing. So they are a little bit different in process and they are a little bit different in economics.
Maurice Jackson: Granite Creek announced the contract. Let me start that again. Three, two, one. Granite Creek Copper announced yesterday that has entered into a contract with Sedgman and Mining. Plus. Introduce us to the company, sir.
Tim Johnson: Well, both Sedgman and Mining Plus are world leaders in their respective fields. Sedgman works a lot on mineral processing, so they look at what the process is to ultimately extract the minerals that you're looking for from the rock, whereas Mining Plus will analyze how we can best the rock out of the ground initially.
I mean in the mining scenario, you've got two things that you need to look at: Digging the rock up, and then once you have that rock dug up, how is it processed to produce your end product. So these are world-class leaders in those fields and we're very pleased to have them on board as they look at helping us optimize the mine plan and the processing plan for Carmacks.
Maurice Jackson: Do we know the methodology that they will be using?
Tim Johnson: Initially, they're going to be doing multiple trade-off studies at a very high, what we consider a desktop level. They will look at existing data and existing work that has been done back into the 1980s. And they're going to look at the various processes that are available today, modern processes, and determine just by trading off which ones are going to be most efficient for the ore and the material that we're developing. They will look at an oxide mine plan and they'll look at a sulfide mine plan, processing of both, and then they'll integrate those into a complete plan that would become the basis for an updated PEA that the company would then engage to move forward on.
Maurice Jackson: You kind of touched on my next question, which was, will they be conducting ore sorting analysis, but will they also be looking at leaching alternatives since you have both oxide and sulfide copper?
Tim Johnson: The ore sorting analysis is new for the project as far as we know. The reason you will look at an ore sort is to try and bring up the grade of the material that is being delivered from the mine so that you're rejecting some of the rock that is unmineralized before it even gets to the mill. This may be a huge cost-savings, and it can also produce a product that may be amenable to processing offsite. If there was a mill that would be able to take our mill feed if we can get the grade up by doing some ore sort, that could be very favorable.
And the other thing is in our deposit, even though we have fairly distinct oxide and sulfide zones, in the oxide zone, there is some sulfide, in the sulfide zone, there's some oxide. Therefore, if we are able to sort that material out, we have a good chance to increase the economics of our deposit. And you're right, it's got both oxide and sulfide. The leaching technologies that you need are likely going to be different. So you're going to look at what leaching works for the oxide. And then at some point, you can look at what leaching works for the sulfide, and you can bring all of that into the mine plan.
Maurice Jackson: Now, what is the proposed timeline for having an updated resource?
Tim Johnson: We would like to have an updated resource fourth quarter of this year. We currently have up to a 10,000-meter drill program going and based on the results of that, turnaround on the labs, there's a lot of questions here. We are going to push towards trying to get that resource updated. Now, of course, we'll need a third party to look at that resource and sign off on it. And again, that is something that it's just going to come down to timing on the availability of those groups. But ideally, it's the fourth quarter. If we can't get have it completed by the fourth quarter, then we're going to work hard to get it by the first quarter of next year.
Maurice Jackson: And you referenced the 10,000-meter drill program. What can you tell us about the latest developments going there?
Tim Johnson: The program was launched just over a week ago, almost two weeks now. We have two drills turning on-site, the program is going very well. We have material already delivered to the lab, and now we're waiting on the results. We expect to be able to put results out on the initial holes sometime in late June, early July timeframe. Again, depending on lab availability. But we're going to have good news flow for the market going up throughout the summer, as we get results back from the lab.
Keeping in mind, this is resource expansion and infill drilling. So this isn't sort of wildcat drilling. We're targeting known mineralization and we're attempting to step out that mineralization to grow the resource and to gain the confidence of moving some of the material from an inferred category to an indicated category. We're expecting some nice results from this drill program.
Maurice Jackson: Now, once the resource has been updated, I'd be remiss if I didn't ask this, when can shareholders expect an updated PFS?
Tim Johnson: Well, that is the $64 question, isn't it? Once we've got the resource updated, once we've got the results from the current studies that Sedgman and Mining Plus are conducting, then we're going to sit down and we're going to decide on whether we update the current PEA, which would be one path that company could take, or we look at going completely to a pre-feasibility study. Now there are pluses and minuses for doing both, but it comes down to the question, is the engineering strong enough to jump to pre-feasibility? Do we need to do some more engineering work or is the projected size of the resource big enough too?
We are not going to go to a feasibility study if, internally, we don't believe we have a mine life that's going to be economic. The previous PEA contemplated a nine-year mine life at 2017 prices; it had a four-year payback. That was a little light. We felt we needed to grow that resource before we could go back and look at taking that jumped to pre-feasibility. So that's kind of the parameters that we're looking at and the decision points that the company is going to be making. Those decision points will come in the fourth quarter of this year, and then we will be announcing what the next step forward is.
Maurice Jackson: Leaving the Yukon, let's look at some numbers. Sir, please provide us with an update on the capital structure for Granite Creek Copper.
Tim Johnson: Yeah. So we're currently 121 million shares issued and outstanding, 171 millionon a fully diluted basis. We've have roughly 51 million warrants out. About half of those, 24 million, are currently in the money. So those are coming in. They're helping fund the program moving forward. The company has roughly $5 million cash on hand. So we're fully funded for this exploration and resource development phase of the company. And we look forward to delivering those results to the investing public.
Maurice Jackson: Speaking of numbers, let's put some icing on the cake. The price of copper is approaching five bucks and Granite Creek has several catalysts. What would you like to say to shareholders?
Tim Johnson: Well, I think the big one is to watch the results coming out of this program. We're going to try to put those into context on how they're affecting the resource. And then the big catalyst is going to be that resource update fourth quarter. But in the meantime, the price of copper as it approaches five and moves north of that, I think is going to be very good for the company. We've seen our peers had their market cap grow significantly since the bottom of copper in May of 2020. And I don't see the copper price pulling back in any major way over the coming months.
Maurice Jackson: Last question, sir, what did I forget to ask?
Tim Johnson: Well, Maurice, as usual, you did an excellent job. I think you hit all the points and I look forward to talking to you again soon.
Maurice Jackson: All right. Thank you, sir. Mr. Johnson, for someone listening that wants to get more information on Granite Creek Copper, please share the contact details.
Tim Johnson: Yes. You can get ahold of us through our website at www.gcxcopper.com.
Maurice Jackson: Mr. Johnson, it's always a pleasure to speak with you. Wishing you and Granite Creek Copper the absolute best, sir.
Tim Johnson: Thank you very much.
Maurice Jackson: And as a reminder, I am licensed representative to buy and sell precious metals through Miles Franklin Precious Metals Investments, where have several options to expand your precious metals portfolio, from physical delivery of gold, silver, platinum, palladium, and rhodium, to offshore depositories and precious metals IRAs. Give me a call at 855.505.1900 or you may email: [email protected]. Finally, please subscribe to www.provenandprobable.com, where we provide Mining Insights and Bullion Sales; subscription is free.
Maurice Jackson is the founder of Proven and Probable, a site that aims to enrich its subscribers through education in precious metals and junior mining companies that will enrich the world.[NLINSERT]
1) Maurice Jackson: I, or members of my immediate household or family, own securities of the following companies mentioned in this article: Granite Creek Copper. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: Granite Creek Copper is a sponsor of Proven and Probable. Proven and Probable disclosures are listed below.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Granite Creek Copper. Click here for important disclosures about sponsor fees.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own shares of Granite Creek Copper, a company mentioned in this article.
Disclosures for Proven and Probable: Proven and Probable LLC receives financial compensation from its sponsors. The compensation is used is to fund both sponsor-specific activities and general report activities, website, and general and administrative costs. Sponsor-specific activities may include aggregating content and publishing that content on the Proven and Probable website, creating and maintaining company landing pages, interviewing key management, posting a banner/billboard, and/or issuing press releases. The fees also cover the costs for Proven and Probable to publish sector-specific information on our site, and also to create content by interviewing experts in the sector. Monthly sponsorship fees range from $1,000 to $4,000 per month. Proven and Probable LLC does accept stock for payment of sponsorship fees. Sponsor pages may be considered advertising for the purposes of 18 U.S.C. 1734.
The Information presented in Proven and Probable is provided for educational and informational purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The Information contained in or provided from or through this forum is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. The Information on this forum and provided from or through this forum is general in nature and is not specific to you the User or anyone else. You should not make any decision, financial, investments, trading or otherwise, based on any of the information presented on this forum without undertaking independent due diligence and consultation with a professional broker or competent financial advisor. You understand that you are using any and all Information available on or through this forum at your own risk.
Images provided by the author.