Chakana Copper (TSX-V: PERU)(OTC: CHKKF) CEO David Kelley on Accelerated Resource Expansion Program via Second Drill Rig at Flagship Soledad Gold-Silver-Copper Project, Peru
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president & CEO of Chakana Copper — Mr. David Kelley. Dave, how are you today?
David Kelley: I'm doing great, Gerardo. Thank you very much. I hope you survive the polar vortex down there!
Gerardo Del Real: We're not out of the woods yet! We've been very fortunate. Thank you for asking. Here at home, we've had power; we've had food; we've had water. I have a lot of friends and acquaintances that haven't been as fortunate. So everybody's coming together and helping each other out, which is really all you can do with times like these, right?
David Kelley: Yeah, absolutely.
Gerardo Del Real: Well, listen, let's talk positive news because if there's something to smile about, it's the accelerated drill program with the second rig at the Soledad project in Peru. One rig was turning; a second one now on the way or there, Dave. And I understand, also, an expanded 26,000 meter drill program for 2021.
Given the results, especially recently, I’ve got to believe you and the team, and shareholders, including myself, have to be excited.
David Kelley: Absolutely, Gerardo! This is such a big step for us. And this is where we've wanted to be for a long time where we've got plenty of money in the bank and two drill rigs on the property. You know how many targets we've got. We've got so many targets. It's going to take a long time to test.
But we've got infill drilling happening now with the second rig. It showed up on Sunday and started drilling right away on Monday. They've already finished their first hole in Paloma East. And we've got a very detailed drill pattern right there at Paloma East. And it'll go back and forth between Paloma East and Paloma West.
It's an ideal situation because those two breccia pipe discoveries are only 110 meters apart; 150 meters apart, something like that. And so the drill rig can actually go back and forth between the two while we're remodeling and putting our new interpretation on the results and figuring out where we need the infill drilling and stuff like that. So that's what's going to occupy the time of the one drill rig that just showed up.
And then the other drill rig is still doing scout drilling at Huancarama. And as you know, we started on the east side of Huancarama. We announced a discovery there. We put a number of drill holes into that. It's a big, big breccia.
It shows the coalescence of two breccia pipes that surface into a much bigger breccia at-depth. And then we moved over to the west side, and I announced in the release that came out today on the acceleration of the drill program, that we found a blind breccia on the west side. And it's looking really interesting.
And so we've got a number of drill holes in and around that breccia, trying to figure out what it means and how big that thing could be.
Gerardo Del Real: Copper is flirting with $4 [per pound]. I understand that 16,000 meters of the 26,000 that will be drilled in 2021 will go towards resource drilling for inclusion in the maiden resource estimate that we're all excited about. Can you fill in the details there?
David Kelley: Yeah, that's just topping off all of the resource drilling we've done previously. We've drilled out Breccia Pipe 1 in the top; 300-350 meter extent. Breccia Pipe 5 at the top. Part of Breccia Pipe 6.
But we still have resource drilling that needs to be done on the new discoveries that we’ve made; Paloma East, Paloma West, and Huancarama. But also Breccia 7, which was discovered back in 2019. Some very nice grades. We only have four holes in it. Size looks good. Grade looks good. And we can go back to that one now too. So that's really the plan for the 16,000 meters.
And then on top of that, we've got another 10,000 meters that's part of this year's program. That'll be for new target testing and testing some of the exploration ideas and concepts. The Paloma area itself is just ripe for further discovery because it sits on a very large geophysical anomaly. It's on a big structure that we've now been able to trace all of the way up past Breccia 1 and Breccia 7. It appears to be a feeder like structure.
And so that entire structural corridor is live now for exploration. So we have some really exciting targets to test with the additional 10,000 meters.
Gerardo Del Real: You mentioned the treasury. That stands at approximately C$9.3 million; is that correct?
David Kelley: Yeah, that's right. And so that's a really healthy position to be. That's obviously going to cover the cost of the drilling this year. And then, the resource estimation is something we'll be working on progressively as we go through the 16,000 meters.
And we anticipate having that out; it will probably be Q3 is my guess; early Q3 is what we're targeting. We've been targeting July. We may be able to make that. But it depends on how much drill-out is required. The Huancarama breccia is still open in many directions and it's already a big breccia. So we need to keep working on that.
Gerardo Del Real: Excellent! How are the labs and how are you dealing with the rainy season there?
David Kelley: The labs are doing okay. I did get a note from them the other day. Our turnaround time has been averaging 15 to 20 days in that regard. But they have been contacted by the Peruvian government; any laboratory that has a capability of filling oxygen containers have been instructed to do that. So they did send a note saying that they were pulling off some of their staff to accommodate that for the second lockdown and the second wave that Peru is going through. But I'm still seeing the results come through on a regular basis so they seem to be managing that pretty well.
And then the rainy season; it has been a really difficult rainy season this year. It's been much stronger than previous years. But again, the guys have managed that very well on the site and we're not doing a lot of moves with the drill rigs. They're in one area. So it's not like they're moving all of the way across the property and that type of thing. So it's been relatively easy to manage for the team on site.
Gerardo Del Real: We're expecting additional results from Huancarama. Any idea on timeline for those?
David Kelley: It'll be soon. I don't have an exact timeline on that. But in the next week or two, we'll have more results on that. It'll be longer, of course, before we get info resource drilling results from Paloma because they just got started.
But we have a number of drill holes from the eastern breccia discovery at Huancarama. And then we'll start getting those scout drilling results out on the western side too. And as before, it'll be a fairly steady cadence of getting assay results out.
Gerardo Del Real: Fantastic! Dave, it sounds like you and I will be chatting soon. Hopefully it'll be warmer and more stable here in Austin! And I hope you stay well, as well, in your part of the world.
David Kelley: Thank you very much, Gerardo… I really appreciate the support!
Gerardo Del Real: Thanks, Dave.
David Kelley: Thank you.