Preliminary results of Vortex Metals Inc.'s (VMSSF:OTCMKTS; VMS:TSX; DM8:FSE) recent surface sampling program at the brownfield Illapel copper project in Chile indicate the presence of copper, silver and gold mineralization, as announced in a news release.
"[The company] put out some fairly impressive soil sample results yesterday morning," Michael Ballanger of GGM Advisory Inc. wrote in a Sept. 18 article. "They were recovered from a brand new area of the Illapel property."
Vortex Metals Director Dr. John Larson and his team collected 13 surface samples from several key areas in the project concessions and sent them to ALS Global, a laboratory in Santiago, for multielement analysis. The team also collected bulk samples from which to produce standards for quality control in future drill core analysis.
Eight of the surface samples showed copper, gold and silver mineralization. Some samples demonstrated elevated levels of associated elements, including iron, molybdenum and cobalt. Some of the standout results, showing high grades are:
- 0.62 grams per ton (0.62 g/t) gold and 1.33% copper in sample 1021
- 75.2 g/t silver and 4.31% copper in sample 1019
- 32.6 g/t silver, 0.21 g/t gold and 5.85% copper in sample 1029
The findings overall confirm that the Illapel concessions may host at least two distinct styles of mineralization: mantos (predominantly copper-silver mineralization) and epithermal vein systems (copper-gold mineralization), the release pointed out. Illapel's potential to host high-grade copper and precious metals deposits suggests future project economic viability.
Diversified Exploration Portfolio
Vortex Metals is a copper-focused explorer-developer with a diversified portfolio of exploration projects in Chile and Mexico. The discovery-driven company believes there has never been a better time to invest in copper-gold exploration, it noted in its presentation.
The Illapel project comprises three mineral leases over about 6,000 hectares in Chile's Choapa province, not far from the community of Illapel. The area boasts sufficient infrastructure and is conducive to year-round drilling, noted Technical Analyst Clive Maund in a Sept. 9 report. The fully permitted project is in "a most promising copper-rich area" and "can be said to have 'blue sky' potential."
Specifically, Illapel is near the fully operational Rio 27 copper-silver mine, from which favorable geology runs north and south. Rio-27 has been in production for more than 10 years and has processed 400,000 tons of high-grade copper (averaging 1.39%) and silver (about 7 g/t) ore, Ballanger wrote.
"This property is a favorite of ex-BHP Billiton Ltd. (BHP:NYSE; BHPLF:OTCPK) Chilean country manager John Larson, whose 16 years with the multinational giant afforded him many 'looks' at properties of merit in the Andean copper belt," he added.
Vortex holds an option to acquire up to an 80% interest in Illapel including right of first refusal on the Rio 27 mine and processing facility, Maund explained.
Illapel also is near Sociedad Punta del Cobre's US$380 million (US$380M) El Espino copper-gold mine, where annual production is estimated to be 26,000,000 tons of copper and 13,000 ounces of gold.
Vortex also owns 100% of Riqueza Marina and Zaachila in an emerging copper belt in Oaxaca, Mexico, through its subsidiary, Empresa Minera Acagold SA de CV. Both of these, drill ready, copper-gold volcanogenic massive sulphide projects, hold potential for significant copper discovery.
The team advancing these assets has successfully developed and exited several exploration projects, including Underworld Resources, sold to Kinross Gold Corp. (K:TSX; KGC:NYSE) for CA$139M.
Copper Price to Remain Strong
The global copper market is expected increase in value by more than 50%, reaching US$259 billion (US$259B), up from US$170B in 2022, according to Statista.
Bank of America analysts predict the copper price will climb past US$10,000 per ton by 2025, Mining.com reported in a Sept. 17 article. (It is now about US$9,266 per ton.) The price will remain strong, they assert, given high demand, constrained supply and rising investment in energy transition projects.
Marin Katusa of Katusa Research wrote in a recent article, "Copper has become indispensable." From electric vehicles to renewable energy systems, its role in the global economy is critical. The ongoing electrification of the world depends heavily on copper, and this dependence is only set to grow."
This is good news for copper exploration companies, particularly those with a copper-gold porphyry deposit. These deposits, according to Investing News Network, are "among the world's most valuable deposits" because they contain the largest known exploitable concentrations of copper.
Maund pointed out that junior exploration companies with worthwhile assets likely will become takeover targets.
INN explained in another article, "Due to their size and scope, copper porphyry deposits have the potential to become large-tonnage, low-cost operations based on mineralization."
According to Katusa, demand for "the engine of the green economy" is "unstoppable" and a supply crunch is inevitable, as indicated by three metrics. They are the rapid decline in days of forward consumption of copper, the long-term global market balance for copper moving toward a deficit and a slowing of global mine production of copper. From 2015 to 2023, only 18,000,000 (18 Mt) of copper were discovered versus 28 Mt in 2014 alone.
While demand for the red metal is increasing, supply remains constrained. Joe Austin, senior analyst at Chaikin Analytics, reported that the copper supply is expected to start declining after peaking at some point in the next two years, according to the International Energy Agency. The agency estimates a copper shortfall of about 7 Mt by 2035, about a third of output forecasted for that year.
"By 2040, the available supply of copper will be roughly two-thirds of what we produce today. But by then, the demand for copper will have soared far higher than where it is today," Austin wrote.
This anticipated tightening of the copper market is likely to cause a price surge, Katusa purported.
The Catalyst: Drill Results
Phase 1 drilling, comprising 3,000 meters, at Illapel is underway to systematically evaluate and advance several high-priority targets within the project area, noted a previous news release.
"It probably won't be long until results from it start coming in, which could clearly act as a catalyst for the stock," Maund wrote.
"Stock in Buying Territory"
Both Ballanger and Maund are bullish on Vortex Metals. In his recent report, Ballanger highlighted that the company's stock is "dirt cheap" and thus, now is a good time to buy.
"I think it will be a solid performer by the end of the year," he added.
Similarly, Maund wrote recently that the stock is in buying territory, based on its charts. In addition, Vortex is well poised to benefit from the current, major bull markets in copper and gold and the momentum in each that is expected soon.
"This being so, [Vortex's] stock is regarded as most attractive here following its dip back to a foundation of strong support that is expected to propel an advance to much higher levels," wrote Maund.
Ownership and Share Structure
According to Reuters, four strategic entities own 7.84%, or 6.28 million (6.28M) shares, of Vortex. They are Director Michael Williams with 3.6% or 2.88M shares, Cofounder, Chief Executive Officer and Director Vikas Ranjan with 2.5% or 2M shares, Roger Zelong with 1.07% or 0.86M shares and Director John Larson with 0.67% or 0.54M shares.
One institution, AIPM Azur International Portfolio Management AG, holds 0.94% or 0.75M shares.
Retail investors own the remaining 91.22% of Vortex.
The company has 80.05M outstanding shares and 77.37M free float traded shares.
Its market cap is CA$5.88M, and its 52-week trading range is CA$0.07–$0.15 per share.
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