Worth Watching: Ten Potential ASX Copper Developers
ASX listed copper-focussed producers are thin on the ground, really it’s a choice between OZ Minerals Limited (OZL, mcap $5.1B) and Sandfire Resources Limited (SFR, mcap $798M). SFR could be worth a look as the imminent closure of its main mine, DeGrussa, has led to negative market sentiment. However, there is still meaningful profit to come from DeGrussa, the company is cash-rich with a reasonable development pipeline.
There are other copper producers, such as BHP, but leverage to copper is limited.
Read about the history of copper and other elements here.
The list below is not exhaustive and I have almost certainly missed comparable companies. The main issue with companies at this development stage is that the transformation from explorer to developer is very risky. The best factors for de-risking are: a major JV partner; an offtake partner which will also provide funding; project delivery by way of a BOOT (build-operate-own-transfer) delivery process.
Aeon Metals Ltd – AML
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
14 | 5.4 | 22.5 | 678 | 95 |
The company holds the Walford Creek deposit in NW QLD. It hosts a total resource of 18.4Mt @ 1.05% copper, 0.9% lead, 0.72% zinc, 29g/t silver and 0.14% cobalt. A PFS is now underway after positive results from a scoping study.
Caravel Minerals – CVV
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
9.4 | 1.5 | 14 | 253 | 24 |
The Caravel Project in the SW Yilgarn of WA hosts a resource of 662Mt @ 0.28% copper. A scoping study completed in 2019 was generally positive although higher grades at start-up was recommended.
Havilah Resources Ltd – HAV
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
18.5 | 5.3 | 22.5 | 270 | 50 |
The company holds the Kalkaroo project & the smaller Mutooroo project in SA. Kalkaroo has a total sulphide resource of 224Mt @ 0.49% copper and 0.36g/t gold. There is also a small surface oxide gold resource. A PFS was completed in 2019 designed to annually produce 30ktCu and 72kozAu for 13 years with a C1 cost of USD1.67/lb.
Hot Chili – HCH
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
4.9 | 0.9 | 5.8 | 2439 | 120 |
The company holds the Costa Fuega Project in northern Chile. The project hosts two resources. Productora; 273 Mt @ 0.44% copper, 0.09g/t gold and 133ppm moly. Production is expected to recommence at Productora by 2021, in JV with the Chilean government. In 2020 a maiden resource was released for Cortadera; 451Mt @ 0.37% copper, 0.13g/t gold, 0.7g/t silver and 61ppm moly.
KGL Resources – KGL
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
32 | 9.3 | 33 | 336 | 107 |
The Jervois Project is located to the east of Alice Springs, NT. It hosts a JORC resource of 21Mt @ 2.03% copper, 31.9g/t silver and 0.29g/t gold, containing 426kt copper in four deposits. The project is quite advanced, with a PFS due by the end of 2020. The plan is to truck a concentrate to Alice Springs and then rail to Darwin or Adelaide.
Orion Minerals Ltd – ORN
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
3 | 1.1 | 4 | 3397 | 102 |
The company holds the Prieska project in South Africa. It hosts a resource of 30.49Mt @ 1.2% copper and 3.7% zinc. A BFS has been completed with robust results. The AISC is USD1.60/lb, and post tax free cash flow is AUD1.6B on capex of AUD413M. Company is at the stage of project finance and seeking a strategic partner.
Redbank Copper – RCP
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
6.7 | 4.8 | 9 | 408 | 27 |
The Redbank Project is located in the McArthur Basin, NT. It hosts a JORC resource of 6.26Mt @ 1.5% copper for 95Kt of copper metal across several small deposits. The mineralisation is hosted by a series of breccia pipes, one of which, Sandy Flat, has been mined on a small scale. The company is seeking to identify more, larger pipes that do not outcrop.
Rex Minerals Ltd
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
13.5 | 2.6 | 26 | 376 | 51 |
The company holds the Hillside copper project in SA, it also has a substantial gold project at Hog Ranch in Nevada. The Hillside resource is 337Mt @ 0.6% copper and 0.14g/t gold. A FS updated in 2020 gave robust results. An AISC of USD1.60/lb and annual EBITDA of AUD152M. The mine life is +13 years. The company is seeking finance and JV partners.
Stavely Minerals – SVY
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
95 | 26.5 | 122 | 261 | 248 |
The Stavely project is located in Western Victoria on the Stavely tablelands. It hosts a chalcocite resource of 28Mt @ 0.4% copper at Thursday’s Gossan. However, of more significance is the discovery of a high grade lode, the Cayley Lode. It was discovered in late 2019 and is still being drilled out, there is not yet a resource. However, it will be large and high grade in copper, along with gold and silver.
Venturex Resources – VXR
Price (c) | 52 Week Low | 52 Week High | Shares (M) | MCAP (M) |
11.5 | 4.7 | 15.5 | 384 | 44 |
The Sulphur Springs project is located in the Pilbara region of WA. It hosts a resource of 13.8Mt @1.5% copper, 3.8% zinc & 17g/t silver. The deposit was discovered many years ago and was acquired by Venturex in 2012, along with the smaller Kangaroo Caves deposit. A DFS was completed in 2018 and mining plan in 2020. The company is now at the stage of finalising design, engineering and offtake and finance.
Conclusion
Australia is not well blessed in the copper space, particularly when compared with the Americas. In the above list several projects have been around for quite some time but have not attracted JV/investor interest. Others may may not attract interest due cost issues such as grade or location. So I would recommend caution when reviewing any of these stocks. Having said that, there is little doubt that one or more will be producers in the near to medium term.