General Base Metals
Hannan Metals (TSX-V: HAN)(OTC: HANNF) CEO Michael Hudson on Identifying a New Copper Porphyry Belt Comprising 18 Magnetic Target Areas at the 100%-owned District-Scale Valiente Copper Project, Peru
Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the CEO of what will end up being one of my top picks for 2023, Hannan Metals — Mr. Michael Hudson. Mike, welcome back. How are you?
Michael Hudson: Very well, thank you, Gerardo.
Gerardo Del Real: I keep telling people that Hannan is going to be one of my top picks — if not my top pick of 2023 — and you keep delivering results that make me look good for saying it so often. And so the most recent bit of news really has me excited.
You announced results from an airborne survey at the Valiente project in Peru. I should mention, this is the 100%-owned Valiente project in central Peru. And I should also mention that the Valiente project is contained within a massive 140 km by 50 km area.
And again, I don't think most people quite appreciate the scale; JOGMEC clearly appreciates its over one-third joint venture that they have that's not on this project. That's worth noting. Teck clearly appreciates what it saw early on with the rest of Hannan and took a stake here recently.
How excited are you by this survey, and what exactly did you learn that's got the team enthusiastic to keep on exploring?
Michael Hudson: Well, it's a little esoteric perhaps for the market but it's certainly worth listening to this and the results from this survey. At every point, a geologist's job is to de-risk a project, which will allow us to determine whether what we’ve found has potential to become economic and to narrow down the search space. So at every point, where we're attempting to do that, whether it's with geophysics or drilling or whatever other technique.
And this survey is an absolute step-change for this project. It, one, demonstrates what we have found in terms of the porphyry epithermal systems have context with these anomalies that we are finding that has actually extended the size of the known mineralized porphyries that we have mapped specifically at Belen but in other areas.
So we've mapped at least 12 different porphyry centers now. It was up from seven over the last few months. And that's all from very detailed soil sampling and mapping and rock chipping and channeling through to just earlier stage projects with stream sediment anomalies. So a whole range of different levels of mineralization.
But this magnetic survey has found, actually, 18 different targets that we now need to follow up. So this is a new belt. That's the key point. This is a new belt in an area where nobody has looked, and it's over that 150 km trend. We've got these porphyries that we've dated that are Miocene age, which is the same age as the belts about 50 to 80 km west in the Andes that are the main producers of copper in the world.
And now, we've found this new belt that, geologically, is a bit of an enigma. But this is not unusual in the Andes. Bajo de la Alumbrera down in Argentina was found outboard in the back arc outside the main Andean trend.
So this is a very exciting project in itself. But now, it's got context with this magnetic survey. These porphyries are magnetic for the most part. They have magnetite, and that's when you're in the core part of these porphyries. And that's very well understood that they are magnetic.
And so we can fly these airborne surveys at 200-meter spacings over the whole trend and map these porphyries. And you can see magnetics. You can model down to hundreds and hundreds of meters. So it's not just a blob on the surface we're seeing. But we can model these magnetic bodies now down in three dimensions.
And we can start to see some of these targets extend under cover where we can't see them sticking up out of the ground like we have. Also as part of this survey, we collected what we call radiometrics, and that measures the radioactivity, basically, of different minerals; potassium, uranium, and thorium, and we can determine which one of those minerals.
Now, we're seeing big potassium anomalies, and potassium is a big part of the core of these porphyries. They become potassium-rich, and we're seeing those coincident with the magnetic anomalies. So it's confirmed what we've seen. It's extended what we've already known and then found many more targets and put them all into context.
So it really demonstrates the veracity of the new Miocene porphyry belt that we own 100% in our own right. Teck, as you mentioned, have come in as a 9% holder… and before we've even drilled a hole, they’ve seen the opportunity and voted with their checkbook. And of course, we've got a very good joint venture separately on another project to discuss another day with the Japanese government (JOGMEC) where we're searching for a slightly different form of copper.
And it's just a very exciting point for the company, and we'll continue to work. We've got something like 10 geologists roaming around the field doing some excellent work; big social teams. And now, we're starting to permit the Valiente area for drilling.
It takes a long time; sort of 18 months to get to those permits. So this is not going to be a drill-tomorrow exercise. But from 18 months to the next five years, you can see us continuing to drill these porphyry centers, any one of which could be an economic porphyry — and it's going to be very exciting.
Gerardo Del Real: I'm looking forward to major discoveries. I'm hoping one of those major discoveries is the ‘Gerardo Del Real Porphyry Center’ within this new belt. And look, Mike, jokes aside, you mentioned 18 months to five years. I think that's an important point to focus on.
This is going to be a land package that is going to see — and I'm talking just Valiente here — many, many, many years of drilling because of the scale. When do we anticipate first-pass drilling on one of the projects?
And of course, we know that'll be with the joint venture, and I know you wanted to chat about that another day. But I want to make sure that people understand the context as to when you expect for a drill to start turning on different parts of this vast basin that you own.
Michael Hudson: We started the permitting process in earnest at the start of this year at the JOGMEC JV — and that has progressed. The process in Peru in these areas is that they require a full DIA study in Peru. And that requires a whole lot of social and environmental work that was completed by mid-year.
And with that application made, the authorities have come back with observations over the last month or so, and there were no red flags there. And we have responded to those. And now, it's just sitting there ready for approval, which we would hope would come early next year. So that's at the JOGMEC JV.
At Valiente, we just started the process of collecting all that baseline data, that environmental data, the cultural data, the social data that will allow us over the next few months to make the application. So you can start to read between the lines.
That's why I'm trying to be as realistic as possible in a very slow permitting environment in Peru that we're probably, from today, 18 months away at a good estimate to drilling in Valiente but only maybe three to six months at the JOGMEC JV.
Gerardo Del Real: And then, likely drilling for many, many years, I suspect, Mike.
Michael Hudson: That's right. Once you start permitting these areas, then they're locked in, and you can have drills turning as you're permitting other areas and working up other areas. So that is the huge opportunity here for us. And it's just a bit of a juncture but a lot of these projects need a lot more work.
So the JOGMEC JV is absolutely ready for drilling — and that's just really waiting. We are still working and doing earlier stage exploration but that's very much wanting to see a drill rig yesterday. The Valiente project has, of course, really only come to light this year with a lot of the work we've been doing. So there's so much more work to be done on many of these porphyry targets.
And now, we have 18 of them to de-risk and do the detailed mapping and soil sampling work that we've done at Belen where we've identified two large porphyries at Ricardo and Sarayaquillo and a 3-km-long epithermal system in between, shedding hundreds of boulders that have very good grades of gold in them. So it's forgotten that there's very good opportunities for high-grade gold here that sit above the porphyries.
Gerardo Del Real: Well said. Mike, exciting times ahead. Thank you so much for that thorough update. Looking forward to news as it continues to develop. Thank you, Mike.
Michael Hudson: Thanks, Gerardo.Click here to see more from Hannan Metals Ltd.