Categories: Mining Stocks
Topics: Copper Stocks

Kincora Copper (TSX-V: KCC)(OTCQB: BZDLF) CEO Sam Spring on Partner-Funded Drilling Across the Northern Junee-Narromine Belt and Upcoming Exploration at the Condobolin Project in New South Wales, Australia

 

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the president & CEO of Kincora Copper (TSX-V: KCC)(OTCQB: BZDLF) — Mr. Sam Spring.

Sam, the summer is coming to an end. Activity and volume are picking up. The price action is starting to heat up in the junior space. And we’re seeing copper looking like it wants to continue to make new all-time highs here for the next several quarters. That bodes really well for Kincora.

And so I thought it would be an opportune time to have you on and just kind of provide an overview of what you’re doing right now and what you’re going to be doing over the next several quarters because it’s going to continue to be busy.

Sam Spring: It is, Gerardo. And it really is a timely opportunity. Just last week, we had a workshop with AngloGold Ashanti, our earn-in partner for the Northern Junee-Narromine Belt, and we also had an internal workshop. And both of those should support news flow coming out in the near term.

With AngloGold Ashanti, we’re drilling early-stage projects with an earn-in structure. We’re the operator, we receive a management fee, and we’re looking to prove up a new province-scale opportunity — really, a new district. And the drilling continues to return really good results, and there’s an overdue update that should come out in due course, reiterating that our thesis there is being upgraded.

And at the same time, in the last quarter, we’ve drilled nine holes at our Condobolin project and are looking at more self-funded exploration in the upcoming quarter. I know it’s the Northern Hemisphere summer, but it’s the Australian winter down here, and we’re looking at coming out of the winter period into the spring and summer with dry drilling conditions and being able to hit a few of the other projects pretty hard.

Gerardo Del Real: Well, listen, there aren’t a lot of juniors out there that have the share structure, the shareholder base, and the cash position that you have. Can you go over the current cash position?

And I want to highlight the share structure and emphasize it because I don’t think it’s a coincidence that people like the Rick Rules and the Jeff Phillipses of the world led the last financing. And not only did they lead it, but they volunteered to lock their shares up for, I believe, a period of 12 months, if I’m not mistaken.

Sam Spring: That’s exactly right, Gerardo. And post that financing, we’ve got 48 million shares outstanding — about half of those on the ASX and about half of those on the TSX-V. We’re dual-listed.

As important as the number of shares outstanding is the composition of the register, including those strategic investors that you touched on. The board and management own 25% of the company as reporting insiders, so the free float of the company is roughly 50%. It is very tight, and that provides great leverage to success.

And as you touched on, the cash position is in a good state. Obviously, it’s a predominantly partner-funded model. We’ve got a hybrid prospect-generator model, but the majority of our dollars going into the ground are funded by a partner. So that money goes a lot further, and we’ve got about A$12 million in the bank.

I should say that there’s another US$5 million due before the end of the year from the recent divestment of our Mongolian projects. And I think you’ll see another tranche of that come through relatively soon and the remaining balance before the end of the year.

That puts us in a really good position to more aggressively roll out this hybrid prospect-generator model, pick up more ground, make the business model more scalable with more projects, and, really importantly, get on with drilling and look to harvest more deals for our flagship projects, which we still retain 100% of and are in active conversations with many of the major mining companies to potentially partner on. 

Gerardo Del Real: You’ve been very efficient with the treasury. You’ve done a great job of building value and maintaining a very robust balance sheet. You’ve monetized assets. But you’ve also continued to look for opportunities, and you recently partnered with a group that’s providing AI-supported technical reviews.

And look, I’m a biased shareholder of that group, so let me just put that out there for the record. But I’ve been absolutely blown away and amazed at the efficiency and thoroughness of some of those technical reviews. Can you speak to that, how it came about, how it’s going, and how it’s been helpful?

Sam Spring: Yes. And I think the company that you’re talking about there very, I guess, discreetly, Gerardo, is Geomorphic AI. And as we put out in our most recent quarterly, we’ve done 28 reviews with them, whether that’s for existing projects that we own or new project opportunities, and we’ve really integrated that within the business.

The original precursor to that was having a well-known, well-respected independent geologist who specializes in porphyries review some of our flagship projects, Trundle and Fairholme. 

And Jeff Phillips, who we know very well, suggested that it was worth getting Geomorphic to do a review of one of those projects and just comparing, “How does a traditional geologist review compare to AI?” And we were sort of blown away by that, and now we’ve adopted Geomorphic as a key part of our exploration process and new-project review process.

And I guess that Geomorphic review, the independent geologist review, and the various reviews we’ve done now provide a really good data set and new ideas to go out there and speak to asset-level partners for our Trundle, Fairholme, and Cowal East projects.

It’s an evolving world with AI, but the Geomorphic system really is saving time, increasing the scale of the business, and bringing efficiencies to us both for existing projects and potential new opportunities. And off the back of that, we’ve also pegged some further ground that was identified in these reviews. So again, it’s making the business model more scalable.

Gerardo Del Real: Excellent. Listen, you’re looking for more opportunities, you’re monetizing assets, and you’re drilling. That’s a lot of catalysts. I understand you’ll be on the conference circuit here over the next couple of months?

Sam Spring: We will. There are a few conferences coming up, which will be great to get out on the front foot and explain what should be a fair bit of news flow, both with drilling and further deals in the pipeline. So it’ll be a really busy end to the year.

And it’s also really nice to see, if the Mongolian tranches come in as we expect them to, an increasing cash balance each quarter of this year, which is a pretty unique scenario for an exploration junior while we’re being active in the field.

Gerardo Del Real: A lot to like. I think the sector is clearly showing signs of heating back up after a seven-month consolidation, which I view as healthy. The gold price, the copper price, the silver price — metals in general — look primed to close the year out strong. I think you’re in a heck of a position.

I encourage anybody out there looking for good exposure to copper and gold, partner-funded exploration, and 100%-owned exploration to go give Kincora Copper a good look. Anything to add to that, Sam?

Sam Spring: No, you’re exactly right there, Gerardo. And the nice thing about these mineral systems that we’re exploring for in Central West New South Wales is they are gold- and copper-rich. So whether we’re speaking of the diversified majors, the copper majors, or the gold majors, the scale of these opportunities would fit in their project portfolios.

And we’re increasingly seeing the majors coming back to earlier-stage exploration opportunities and growth and effectively outsourcing exploration by doing deals with juniors like ourselves and other well-regarded hybrid prospect generators that have good ground and good management teams.

Gerardo Del Real: Looking forward to an exciting close to the year. Sam, always a pleasure to chat. Looking forward to seeing you on the conference circuit as well. Thank you, sir.

Sam Spring: Thank you, Gerardo.

Gerardo Del Real: Alright, chat soon. Cheers.

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