Abitibi Metals drills 3.5% copper in Quebec

Abitibi Metals (CSE: AMQ; OTC: AMQFF) says its first two drill holes at the B26 polymetallic deposit in northern Quebec bode well to earn most of the project from the provincial government and develop an open-pit mine.

Drillhole 1274-24-293 intersected 22.7 metres grading 3.5% copper, 0.7 gram gold per tonne, and 6.6 grams silver from 120 metres depth including 10.6 metres at 5.4% copper, 1.3 grams gold and 9.6 grams silver, Abitibi reported on Thursday. Drillhole 1274-24-294 cut 34 metres at 3% copper, 1.5 grams gold and 6 grams silver from 135 metres depth, it said.

“These are some of the highest-grade intercepts in the project’s history and show a way to potentially increase the grade of our block model,” Abitibi CEO Jonathon Deluce said in a release. “Investigating the significant increase in grade in #293 when compared to the historical results will be a key objective of ours.”

The results support the project’s near-surface open-pit potential, Abitibi said. The project feeds into the global energy transition’s need to expand copper production by nearly three times current levels by 2040, according to the International Energy Agency.

Shares in Abitibi Metals, which was known until last year as Goldseek (CSE: GSK), gained 3% on Thursday morning in Toronto to 69¢ apiece, valuing the company at $68.5 million. They’ve risen from 14¢ in November.  

Giustra-backed

Abitibi is advancing a plan to earn 80% of the project over seven years from Soquem, a subsidiary of Investment Quebec. The junior holds 9.9% of the project and last year raised more than $14 million from investors such as Frank Giustra, who helped start Wheaton Precious Metals (TSX: WPM, NYSE: WPM; LSE: WPM) and Endeavour Mining (TSX: EDV; LSE: EDV), for a four-year work program.

B26 holds 7 million indicated tonnes grading 2.9% copper-equivalent (1.3% copper, 1.8% zinc, 0.6 gram gold per tonne and 43 grams silver); and 4.4 million inferred tonnes at 3% copper-equivalent (2% copper, 0.2% zinc, 1.1 grams gold and 9 grams silver), according to a 2018 resource estimate by Soquem.

Abitibi’s initial 10,000-metre drill program has completed 6,088 metres across 20 holes so far. The company plans 20,000 more metres this year.

The 33-sq.-km site is 7 km south of the former Selbaie mine, where BHP (NYSE: BHP; LSE: BHP; ASX: BHP) produced copper, zinc, gold and silver from 1958 until 1993. There’s still a nearby working power line that served the Selbaie mine. B26 is 90 km west of the town of Matagami, which has a skilled mining workforce for Glencore’s (LSE: GLEN) complex there.

Beats old holes

The results released Thursday are associated with well-defined mineralization in a network of nearly massive chalcopyrite veins, the company said. The grade within the first 140 metres of hole 1274-24-293 showed 4% copper-equivalent compared with 1.2% copper-equivalent in a similar stretch of historical hole B26-40, it said.

“This represents an opportunity to investigate other areas in the deposit where the grade could be understated,” it said. “Overall, the style of mineralization observed in the two holes close together could follow a braided deformation pattern which can explain part of the grade variations observed.”

Abitibi plans to review historical cores to determine areas which require re-assaying to test for higher grades, as well as areas to duplicate to confirm whether there is a similar increase in grade. More drilling may test the down-dip and lateral expansion potential of the lens, it said.

Greg Chamandy, a former CEO of Montreal-based Gildan Activewear whom Abitibi calls a strategic investor like Giustra, said the assays are a great start.

“The results highlight the exceptionally high grade of the deposit,” Chamandy said in the company’s release. “With a well-capitalized treasury, strong leadership and one of the most promising copper and gold projects in North America, Abitibi is in an excellent position.”