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Azarga Metals excited to be back on the ground at potentially 'globally significant' Unkur discovery

Snapshot

The asset lies in the Chara-Aldan area, encompassing around 320,000 sq km and is home to a basin which hosts some major copper deposits

Azarga Metals -

Quick facts: Azarga Metals

Price: 0.055 CAD

TSX-V:AZR
Market: TSX-V
Market Cap: $5.14 m
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  • Flagship Unkur copper and silver project in Zabaikalsky province of Russia's Far East,

  • Significant resource, which is already 47% bigger than the 2017 inferred resource

  • Near to the land border with China; water and power nearby

What Azarga Metals does:

Azarga Metals Corp (CVE:AZR) is a Canada-headquartered explorer which owns 100% of the Unkur copper and silver project in the Zabaikalsky province in Russia's Far East, which it says is a discovery of 'global significance'.

The asset lies in the Chara-Aldan area, encompassing around 320,000 sq km and is home to the KodarUdokan Basin, which is known to host major copper deposits, such as Udokan.

The latter is currently in development, and is the world’s third largest unmined copper deposit, containing around 27 million tonnes of the red metal.

Unkur boasts a 5,390 hectare (ha) mineral exploitation license, granted by Russia five years ago and some historical data. The first modern exploration program was conducted between 2016/17, which included 16 diamond core holes.

The firm, which has a market cap of under C$10 million, says Unkur is a globally significant discovery and has a current inferred resource of 62 million tonnes of material at 0.53% copper and 38.6 g/t silver, or 91g/t silver equivalent.

That equates to 558,000 tonnes, or 1.2 billion pounds of copper equivalent metal or around 182 million ounces of silver equivalent. Notably, the project is open in both directions along strike and also down dip.

A preliminary economic assessment (PEA) released last year envisages a 2 million tonnes per year open pit mine generating high-grade bulk copper-silver concentrate containing 13,200 tonnes of copper and 3.7 million ounces of silver over eight years. The pre-tax net present value (NPV) of the mine was put at US$203.6 million with an internal rate of return (IRR) of 28.9%.

That assumed a copper price of US$3.25 per pound and a silver price of US$20 per ounce and one US dollar being worth 62.5 Russian Ruble.

How is it doing:

On August 6 this year, the group revealed that surveying and fieldwork had begun at the Unkur property after a visit by Azarga CEO Michael Hopley and its vice-president of exploration Dr Alexander Yakubchuk, marking the start of what will be the largest physical exploration program undertaken on the project since Azarga Metal’s acquisition of the asset in 2016. 

The work, to expand known mineralization, is being funded by a US$2 million investment from Baker Steel Resources Trust Ltd (LON:BSRT) first announced in April this year.

Hopley commented after the visit: "I was struck with the large-scale widespread nature of the mineralization at Unkur and, based on Dr. Yakubchuk’s familiarities with the other deposits in the area, with the many apparent geological similarities to the giant Udokan deposit where the mine is currently being constructed by the owners Baikal Mining Company and which is reported to contain 24 million tonnes of copper and is located just 30 km to the south of Unkur".

Magnetic survey data exists for the northwest part of Unkur, or around 20% of the whole property and this is where all previous drilling and all current resources are located so the firm now plans to have the remaining part of the property covered with a magnetic survey ahead of  an upcoming 6,000 meter diamond drill program, which is earmarked to start this autumn.

This geophysical survey will includes 28 line-kilometers of induced polarization (IP) expected to define new zones of copper-silver mineralization. The surveys will be finished by the end of September this year.

Also ongoing in the field is a detailed re-logging of the drill core from the 2016–2017 season for a more complete understanding of the controls of mineralization and the relationship between the sedimentary rocks hosting the copper-silver mineralization and highly magnetic hematite-magnetite rich sedimentary units.

On August 12, Azarga said Baker Steel had funded the second and final tranche of the US$2 million financing. Assuming it converted all of the US$3 million owing to it, Baker Steel would beneficially own and control over 58.5 million company shares, or around 39.16% of the  firm's capital.

Inflexion points

  • Exploration results
  • Start of diamond drilling
  • Copper price upswing

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Watch

Azarga Metals starts drilling program at Unkur Copper-Silver project in Russia

Azarga Metals (CVE: AZR) President and CEO Michael Hopley joined Steve Darling from Proactive Vancouver with news the company has started drilling on the copper-silver project in Eastern Russia.  The Unkur site saw, most recently, both a ground magnetic survey and nine induced...

on 10/08/2019

4 min read