Robert Friedland-led Ivanhoe Electric (TSX: IE; NYSE-AM: IE) expects to update the resource estimate for its flagship Santa Cruz copper project in Arizona in January.
Santa Cruz’s current resource (December 2021) at a copper cut-off grade of 0.39%, stands at 274 million indicated tonnes grading 0.93% copper for 2.5 million tonnes of contained copper and 248.8 million inferred tonnes grading 0.91% copper for 2.3 million tonnes of copper.
At a 1% copper cut-off grade, the company notes the project maintains nearly 60% of its contained metal, with 1.4 million tonnes of contained metal in the indicated category at an average grade of 1.7% copper and 1.4 million tonnes of copper in the inferred category at an average grade of 1.9% copper.
The new resource estimate will update the existing Santa Cruz deposit and will include initial estimates for the Texaco and East Ridge deposit areas. In addition, the company expects to complete a preliminary economic assessment on the Santa Cruz deposit alone in the second quarter of next year.
Ivanhoe Electric has the option to earn 100% of the project and describes Santa Cruz as “currently the second-largest undeveloped copper deposit, by tonnes contained, in the lower 48 states, with considerable potential to significantly expand the resources.”
Ivanhoe Mines executive chairman Robert Friedland in action at the Investing in Africa Mining Indaba on May 11. Credit: Henry Lazenby
The company says its near-term focus is discovering shallow high-grade mineralization based on a revised geological model, and is using its proprietary Typhoon exploration search technology in the effort. After a 26.5 sq km Typhoon survey was completed in July, three drill rigs were re-assigned from the Santa Cruz deposit evaluation drill program to test five major chargeability targets that the company says could be indicative of new zones of sulphide mineralization. Drilling at the East Ridge Typhoon target started in late September and at the Far Southwest Typhoon target in mid-October. Drill rigs will return in November to the Texaco target, 3.5 km northeast of the Santa Cruz deposit. (A previous drill hole at Texaco (SCC-019) returned 73 metres grading 2.2% copper.)
As many as eight drill rigs are working around the clock and the company has completed 23,945 metres of infill drilling and 7,792 metres of drilling to support studies on underground mine access.
Notable intercepts from its 2021 and 2022 drilling at Santa Cruz include drillhole SCC-001, which cut 443.3 metres of 1.37% total copper starting from 584 metres downhole and drillhole SCC-002, which returned a 198-metre interval of 1.05% copper from 721 metres. Drillhole SCC-005 intersected 57 metres of 3.52% copper from 636 metres.
In early October, the company introduced on-site scanning of drill core with technology developed by GeologicAI of Calgary, Alberta, which once fully deployed, will enable a two to three-day turnaround time for preliminary geological data, the company says.
Ivanhoe Electric acquired Santa Cruz in mid-2021.
Copper mineralization on the property was first discovered more than 50 years ago, with the Santa Cruz, Texaco and Park Salyer copper deposits identified beneath gravel cover. Park Salyer is 2.5 km northeast of Texaco, and 2.5 km southwest of the past-producing Sacaton copper mine.
The 78 sq. km Santa Cruz project is about an hour’s drive south of Phoenix, and 11 km west of the city of Casa Grande.
Over the last year, Ivanhoe Electric has traded in a range of $10 and $15.26 per share, and at presstime in Toronto was trading at $13.80.
The company has about 93 million common shares outstanding for a market cap of roughly $1.4 billion.
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