Chakana Copper (TSX-V: PERU)(OTC: CHKKF) CEO David Kelley on Latest Batch of High-Grade Copper-Dominant Assays at Flagship Soledad 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. Dave Kelley. Dave, how are you today?
David Kelley: I'm doing great, Gerardo. How are you doing?
Gerardo Del Real: I am well. Thank you for jumping on the call. You had some news this morning… some very, very good numbers and I want to highlight those. And then, I have to ask you, of course, socially with COVID and politically with the elections coming up in Peru — how things are going.
But let's start with the news that you had today, which was, again, just more phenomenal numbers. The headline reads:
Chakana Advances Resource Definition Drilling With Multiple High-Grade Intercepts
And this is always what we hope and want… is continuity in both grade and widths, right, and you're getting them.
At Huancarama East, you had an intercept that included:
134.3 meters of 0.92 grams per tonne (g/t) gold, 0.86% copper, and 80.7 g/t silver from 119.7 meters
At Paloma East, you had an intercept that was running:
126.1 meters of 0.91 g/t gold, 0.20% copper, and 11.6 g/t silver (or 0.89% copper equivalent); that started at-surface
Two holes, high grades; 101 meters of 0.53 g/t gold, 1.01% copper, and 41.5 g/t silver (or 1.71% copper equivalent), again, starting at-surface
Starting at-surface; it's shallow; it's high-grade… and you've got the three commodities that everybody's really hot on right now, right? You have gold, silver, and copper in there!
David Kelley: Yeah, it was a great release of results. Eleven drill holes; 2,800 meters. And it was really just a reminder that we've got our head down; we're drilling hard. We've got two rigs running 24/7, and we're getting about 3,000 meters per month of production.
So the drilling is going exceptionally well. The results speak for themselves. We're headed towards that initial resource estimate later this year — targeted for October. And things really couldn't be going better on the project in spite of COVID.
It's a very challenging situation in Peru right now. And we know people are preoccupied with what's happening with the election. But we think that is just a passing storm and that it's going to clear up here in a couple of weeks. We're going to know what the result is.
And either way, whichever candidate wins, we think that mining is going to continue in Peru. It's the number two copper producer in the world, and that's not going to stop overnight. There's great momentum for development in Peru with the number of projects and $50 billion worth of projects planned for future development.
So the future is bright for Peru. And it's unfortunate that people have gotten distracted with a lot of sensational news and stuff like that. I don't think it's going to be as bad as people think. And in the meantime, we're making great progress on this project.
Gerardo Del Real: I couldn't help but observe that you noted the potential for new targets in the northern portion of the project — and those haven't been drilled. And as you mentioned in the release, they're very strategic to any eventual development at Soledad, which, let's be very clear, that's the end game here, right — is increase the resource, monetize it, and develop it eventually, right? That's the game plan here.
But tell me a bit about those new targets because there is additional exploration drilling. The results today were infill drilling. But there is exploration drilling ongoing and planned for the rest of the year, correct?
David Kelley: Yeah, that's right. And we're intermingling the exploration target testing in between resource drilling at specific sites. And it's really based on logistics. And if a drill rig is on one side of the property and we've got an exploration target right beside where we're doing infill drilling — we'll take advantage of that.
It makes more sense; it's more efficient. And we'll test the target, and then we'll move on to doing more resource or infill drilling at another location. And we are trying to front load the schedule with more resource infill drilling now so that we have time to get those results back and we can hit that target date of October for the first resource estimate this year.
So what you're likely to see is we'll have sporadic exploration results released in the interim along with infill drilling results. But then, as we move further into the season, you'll start seeing more exploration target testing happening and more results in that regard. And that's just optimizing our program so that we get all of the resource infill drilling assays in sooner so we can make those part of the resource estimate later this year.
Gerardo Del Real: Gold is knocking on $1,900's door. Silver is knocking on $28 an ounce's door, and copper is right at $4.50. So a great time to be discovering and developing copper-gold-silver mineralization in the breccia pipes that you have. How many are you up to now on the property there, Dave?
David Kelley: Well, there's 23 breccia pipes that are cropping out or sticking out; exposed at-surface. And we've already hit two blind breccias, which we know that that's going to continue to happen. Ultimately, I think there's probably between 40 and 50 breccia pipes. But there could be a hundred.
There are great examples of this in the geologic literature of tourmaline breccia pipe systems that have well over a hundred breccia pipes. And the number we're starting to focus on now, because we went back and did the math, we have 110 targets, of which 23 of those are the outcropping breccia pipes. Another 15 or 20 are alteration that we only see peripheral to tourmaline breccia pipes. And then, we have geophysical targets; we have geochemical targets; we have structural targets.
And so when you put it all together, the total number of targets that we have on the property defined to-date is 110. And we've only tested 15 of those in our drilling. And of that, we've had multiple breccia pipe discoveries. So we know that the discoveries are going to continue.
We know that the mineralization in these breccia pipes is open at-depth. So there's a depth extent expansion in the future that is the additional breccia pipes to add to the inventory as upside potential.
And we'll continue to discover mineralization in the future well beyond what we know now. So it's still very, very early in this discovery story even though we’ve drilled 47,000 meters to-date.
Gerardo Del Real: Frankly, it's fascinating to have 110 total targets… to be at the stage that you're at… about to publish a resource estimate here in October, I believe, is the date that you cited, the month…
David Kelley: Yeah.
Gerardo Del Real: Yeah, 15 out of 110 total targets… that's got to make your partner happy…
David Kelley: Yeah, Gold Fields has been, as we've talked before, a great supporter of the project and the exploration that we're doing. They're very engaged. They're helping us a lot right now with the next phase of the geophysical exploration on the property.
And we're trying to get smarter and better at how we define and test these blind targets. And geophysics is certainly going to feature prominently in that. So we've got another round of orientation geophysics, which is really when you get in there with lots of different types of equipment and do small surveys over known areas where you’ve drilled and you know it's at-depth — and you can really hone in and refine your techniques. And then, you can apply that to the rest of the property. And so that's upcoming.
And, no doubt, that's going to substantiate and further enhance the 110 targets that we have. But it'll probably also add additional targets to that. So we're very excited about that. Gold Fields is excited. They're contributing lots of resources to make sure that we can continue the track record of discovery that we've already started. And it's great to have such a supportive strategic investor in the company.
Gerardo Del Real: Dave, thanks for the update… thanks for your time. Keep up the good work and we'll chat again soon. Sounds like you've got more assays in the queue!
David Kelley: Absolutely! Thanks a lot, Gerardo. Take care.
Gerardo Del Real: Alright, thank you.