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Chakana Copper (TSX-V: PERU) CEO David Kelley: Latest Drill Hole Confirms Vertical Extensive Nature of Breccia Pipes at the Soledad Project

September 13, 2018

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the CEO of Chakana Copper (TSX-V: PERU)(OTC: CHKKF), Mr. David Kelley. David, how are you today?

David Kelley: I'm great, Gerardo. How are you doing?

Gerardo Del Real: I am doing fantastic. I appreciate you taking the time this afternoon. You just released what I understand is not just the best hole at the property, but the best hole you've ever drilled. Let me read the headline real quick, "Chakana Copper confirms deep surface-down mineralization at Breccia Pipe 1, the highlight intersection is 439 meters of 0.69% copper, 1.4 grams per tonne gold, and 50.5 grams per tonne silver from surface."

Congratulations, I know it's a tough mark here right now. We talked a little bit off air, but I'd love for you to provide some context as to how good this particular hole was. And then let's talk about the other three because I believe that you released a total of four additional holes from Breccia Pipe 1, if I'm not mistaken.

David Kelley: Yeah that's right, Gerardo. This hole is really significant. It really documents the vertical potential of these tourmaline breccia pipes. Part of our challenge from the beginning with this project has been trying to educate people as to what tourmaline breccia pipes are, how they form, what their characteristics are. And one of those characteristics is they tend to be vertically extensive, so actually having a drill hole like this in hand, where we can study it, where we can understand the textures and the contact relationship is huge to be able to confirm that vertical extensive nature.

And it's still open at depth. This hole exited the side of the pipe and there's no doubt that the mineralization continues in our mind. The real significant part about the hole, it cut the main breccia pipe, which outcrops at surface. It then cut a very strongly mineralized host rock section, which we had not seen before. Not to this degree. Very high grade, especially, well, copper, gold, and silver, all metals very high. And then it penetrates a thick section of the north breccia pipe, which was a blind discovery that we had previously made in previous drilling at Breccia Pipe 1.

Gerardo Del Real: You mentioned that it was noteworthy to see mineralization in the pre-mineral host rock to the tourmaline breccia pipe. Can you explain that?

David Kelley: Yeah. So far most of the mineralization has been hosted within the breccia pipes themselves. We believe that's due to the porosity, the open space nature of the breccia being a great receptive host to fluids permeating through that. When you see mineralization outside of the breccia, it means that something else is going on. We don't know what the controls of that are at this point, but we see very strong mineralization. I believe that interval that we're talking about ran 2.7 grams gold, over 2% copper, and 211 grams silver. So very, very strongly mineralized.

And the significance of that is that if the host rock itself is getting mineralized around the breccia pipes, it enlarges the target. It means that potentially a larger volume of rock could be mineralized and ultimately that larger volume of rock could contribute to a resource.

Gerardo Del Real: We've seen some M&A in the copper space recently. This is emerging as one of the more exciting projects by a junior. What's next? I know everybody's eagerly anticipating what will be a game-changing permit when in hand. How is that coming along, Dave?

David Kelley: The permit is coming along well. We estimate one to two weeks and we'll have that in hand. We're just doing the final responses to the ministry on any questions that they have. Once they have that information – they'll have that on Friday – then that will be put into a final report and submitted for review and final signing by the director of mines. So we estimate to have that in hand.

That's going to provide an additional 160 platforms that we'll be able to drill from. We can take those platforms and move them to other locations outside of the original permit area, which will ultimately give us access to the Huancarama Breccia Complex – which we've talked about in our previous release, it's a very impressive large zone of mineralization right at surface – and the Paloma Pipes, also very high grade in surface sampling right at surface. So we're very excited to continue with the permitting and to get access to additional platforms and then expand the work area to be able to build a very high priority targets.

Gerardo Del Real: And you have two rigs turning now. Is that accurate?

David Kelley: That's right. We're drilling the third and fourth breccia pipes in the property to date since we started. We've finished resource drilling on Breccia Pipe 1 and Breccia Pipe 5. We're still putting out results on those two pipes and then you'll start seeing results come out from Breccia Pipe 3 East and Breccia Pipe 6 where the drill rigs are turning now.

All is going well. The weather this time of year is perfect, we're getting great productivity out of the two drill rigs, about 2,000 meters per month, which is really spectacular production. Our drill contractor has really done an excellent job there and the team has functioned well. So we're going to continue to crank out the results and test the potential of the project.

Gerardo Del Real: Lot of good stuff going on, David. I'm looking forward to having you back on as those assays come in and of course that permit decision, which is a big deal of course.

David Kelley: You bet, Gerardo. Any time, we're happy to give you guys updates and we appreciate the attention.

Gerardo Del Real: Thank you.

David Kelley: Thank you. Have a great day.

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