Read on for a detailed discussion about the news results released today from Bell Copper (TSXV:BCU). These are the first results from the first drill program executed by Kennecott Exploration Company under the first stage of their option agreement from Bell Copper.
Peter Bell: The meat of this release with hole K-17 here is 0.57 grams per tonne gold over a 20 meter intersection from 481 meters depth. This would seem to be fairly typical for the outer zones of a copper porphyry. Is this type of result expected, in general?
Tim Marsh: Gold is nice to see in a porphyry system. This is an encouraging gold intersection. If it were on the surface, then it would have a chance at today's gold price at becoming a gold mine. Of course, you would need to follow it up and find more nearby but it's not particularly interesting to Bell Copper except that it shows there is gold-rich mineralization associated with the porphyry that we're chasing.
Gold commonly fills up in two domains in a porphyry copper system. One is where we found it here out in the outer margins. The other is often in the core of the porphyry, right in the heart of the copper shell associated with bornite and chalcopyrite. We haven't found that part of the system yet, but an intersection like we had in K-17 makes me optimistic that when we do find the heart of the system it will have significant copper mineralization and a decent gold credit to go along with it.
Peter Bell: Is the specific depth of this intercept surprising at all?
Tim Marsh: I would say the depth is typical for what we have seen before.
Peter Bell: The oxidized hematite is an iron oxide, I believe. Is it typical to see that with gold in the outer domain of a porphyry?
Tim Marsh: It probably reflects oxidation of what was originally gold-pyrite mineralization. Gold and copper are on the same group in the periodic table and they are chemically similar, but their solubility in sulphuric acid is considerably different. Copper migrates in an oxidizing, acidic fluid. The gold just smiles and stays put. Intersecting gold in this hole shows that the process of supergene leaching and potentially supergene enrichment has operated at Kabba, which is really important when we're looking for copper.
Once we can locate a copper-rich shell, the copper in that zone of oxidation will have been stripped or leached out and transported downward under the influence of gravity to an oxidation boundary where it can re-precipitate in a more concentrated form as a supergene enrichment blanket. In porphyry copper deposits, that enrichment blanket offers opportunity for quick economic payback of capital when building a mine. It's the meat and potatoes of the early days of a porphyry copper mine.
Peter Bell: Interesting. Let’s hope it’s not too deep! A couple more questions for you here about all this. How much deeper did the hole go beyond the oxidized zone?
Tim Marsh: We drilled below the zone of oxidation in K-17. We got out into the primary sulphide rock, although this gold anomaly ended before we got into all sulphide rock.
Peter Bell: And this release makes it clear that you know what you're after and are staying focused, but if you had intersected elevated copper grades at the oxidation boundary then you probably would have told us.
Tim Marsh: We have enhanced grades at that boundary that do suggest the supergene enrichment process is operating at Kabba. There are many meters of leached material in the core, which indicate a sufficiently oxidized interval to cause enhanced copper grades in that boundary. The copper is all going to get washed down and concentrated into a much tighter interval that provides enhanced grade that might be mineable.
Peter Bell: And I guess people will infer that you're still far enough outside of the copper shell that the enhanced grades you would've seen in that boundary aren't really the enhanced grades that you would think of as like a headline, "We hit it," type result.
Tim Marsh: We will see it very clearly in the core and the assays will reflect it very strongly when we hit it. I can see the geochemical evidence for the enrichment, but it's nothing that will set the copper world on fire yet.
Peter Bell: And how about the location of K-17? Was it another step out to the east to test how far the porphyry moved to the east?
Tim Marsh: No, K-17 was nearly a kilometer back to the west.
Peter Bell: Wow. You guys make some pretty big steps. Hearing about the first hole that was in the gravel and then the next hole is a mile to the east of that, it's amazing.
Tim Marsh: There are two important reasons for that. One is there has been a lot of slip on that fault. The second is the system's very large, so hitting mineralization and strong alteration doesn't necessarily put you in the middle of the system. The system we're exploring for is 3 kilometers by 5 kilometers, so you can make some very large step-outs and still not find the copper shell.
Keep in mind that what we are looking for is on par with some of the biggest in the world. The target we're looking for is a very large system.
Peter Bell: And you're getting closer, proving different parts of your model of how this porphyry moved to the east. It’s been years of work to develop that geological model.
Tim Marsh: Yes. The five holes that were drilled in the first 2017 program were very strongly focused on testing chargeability anomalies, surface IP anomalies. Through the drilling, we recognized that that chargeability was caused by very abundant pyrite. That is a good indication we're in the right neighborhood because porphyry copper deposits more than any other element are anomalies of sulphur. Sulphur expresses itself as the mineral pyrite or pyrrhotite, which is quite chargeable using the IP technique.
Peter Bell: How about the anomalous levels of pathfinder elements from holes K-8 through K-17, are there any maps the company has made public?
Tim Marsh: We haven't made any of that information public because it's not something our partner would like to have in the public domain. We do have the information in map form and we use it to determine where the next holes ought to be drilled. The suite of elements that we see at anomalous levels are characteristic of porphyry copper deposits.
Peter Bell: One of the joys of working with a major is their oversight on what you release publicly. If they were to abandon their option agreement, would they have an NSR or anything on Kabba?
Tim Marsh: No, nothing like that. If they decide to leave, then we expect they will not leave anything behind other than some well-reclaimed drill sites.
Peter Bell: And what about the timing on this five-hole program. They only completed the initial 2017 program in September, which is getting quite late in the year. Any sense for what was going on there?
Tim Marsh: The biggest delay was permitting. There were some old rusty cans, literally, that were laying nearby and an archeologist was required to determine if they represented significant historical human activity that would affect our exploration activities.
Peter Bell: It's amazing how much garbage there is out there in the desert in Arizona.
Tim Marsh: That's what slowed us down. If the people 50 years ago had picked up their garbage, then we could have been drilling in June.
Peter Bell: Another good reason for environmentalism amongst geologists! That’s great.
How about the next program? I understand they drilled two holes in December and results are pending.
Tim Marsh: Yes. We drilled K-18 and K-19 very late in November and into mid-December. We shut the program down on a holiday constraint rather than a geological constraint. Kennecott got the material from those two holes cut and into the lab quite quickly. I expect we'll have assay data from those two holes to put out in a press release within the next few weeks.
Peter Bell: The quality control procedures seem to be pretty standard, Tim. Sampling on two- or three-meter intervals seems reasonable when the mineralized intersection is 20 meters long.
Tim Marsh: It's an assay interval that's typical for large porphyry copper systems. It's not something that you usually use on a gold system where the significant gold concentrations can be in very narrow structures. It's possible there are higher grade, probably even likely that there are higher grade intersections within that interval, but that’s not really the target Bell Copper is pursuing. We're pursuing a very large porphyry copper target. We're looking for intersections with elevated copper over many hundreds of meters.
Peter Bell: Are they assaying the entire holes at this point?
Tim Marsh: They are assaying everything once we get below the gravel or young basalt cover.
Peter Bell: Good. And it’s the full 47 element suite, which gives you a very rich dataset to keep after those pathfinder elements.
Maybe a couple geological questions for you, Tim. The term "Laramide porphyry" is somewhat unfamiliar to me. What's the significance of it?
Tim Marsh: It's a geological term that refers to a time period in the western United States when a major mountain building episode was underway that involved volcanic activity in the western US and block fault mountain building in the central US out to the Black Hills of South Dakota and the range front of the Rockies in Colorado, but it was a major mountain building episode. It's been given a name, named after Laramie, Wyoming, and it is the time period about 15 million years in length in which most of the copper in Arizona was emplaced, so it's a very important age for copper exploration. If you're drilling rocks of Laramide age, then you are where you need to be.
Peter Bell: Wonderful, thank you very much. I'll file that away for future reference. And another question about the geology, specifically about how the upper part of the porphyry moved so many kilometers to the east at Kabba. With this displacement, there should be some connections between the rocks at depth where you are drilling and the rocks at surface to the west. Is there anything about this hole that can connect the footwall and hangingwall areas – maybe a gold mine on the Hualapai Mountains to match the gold intersected in this hole?
Tim Marsh: There are several small gold mines back in the footwall zone, but I can't point to one in particular that this gold intersection in K-17 might correlate with. There are historic small gold mines back in the footwall that one day will probably be matched with mineralization we establish at our target area.
Peter Bell: And how close is this intersection in K-17 to the slip fault itself?
Tim Marsh: K-17 is quite far above it. I think we would've had to have drilled another 5,000 feet or so at the K17 position to get down as deep as that fault.
Peter Bell: Wow. There really is quite a lot of space below where you are drilling now to find the extent of this porphyry system before it starts getting broken off by the fault. 5,000 feet gives you lots of room to work with.
Tim Marsh: We think there are at least two kilometers or over 6,000 feet of depth where we can find that copper shell and follow it to its bottom. Its bottom should be preserved somewhere above the fault because that copper shell didn't extend as deeply as the footwall.
Peter Bell: Right. It was the quartz magnetite veins that you see exposed at surface to the west, which are typically seen in the roots of the system as the deeper equivalent of the chalcopyrite veins. That’s an interesting distinction you told me about recently. And K-17 was a vertical hole again?
Tim Marsh: Yes, all of our holes so far have been vertical. For the time being there isn't a compelling reason to switch to angle drilling.
Peter Bell: And to jump back to the start of the release there as well, I was surprised to hear just how much meterage you have done there in the first 17 holes: 5,800 meters in total. That's a substantial number. On average, these holes are over 300 meters deep. Is that fair?
Tim Marsh: Not exactly, Peter.
In the recent drilling, our partner has focused on testing targets with short holes since the real opportunity for higher than average grade copper mineralization is in the shallow part of the intersections. We cut holes off in this last five-hole program that still had the possibility for long intersections of lower grade copper mineralization at mineable depths. We were looking for supergene enrichment, where the copper is concentrated as we discussed before.
In contrast, Bell Copper’s holes in the past from hole K-1 through K-12 were very long holes. The length of those holes disproportionately contributes to that 5,800 meter total and reflects the continuous nature of sulphide mineralization hosted in porphyry rock over great lengths.
When the drill is set up and drilling sulphides in altered porphyritic rocks, I don’t cut holes off. If I'm seeing those kinds of things coming out of the ground, whether it's just pyrite or maybe some chalcopyrite and pyrite, I keep the hole going. If Bell Copper has a little more control of future drilling, then we will resume that approach.
Peter Bell: Okay, so it’s more of a bimodal distribution for the hole lengths. I was thinking that 300 meters wasn’t quite right since this gold intercept in hole K-17 was hit leading up to 500 meters depth!
Tim Marsh: For comparison, Peter, our long holes at Kabba have been 1,300 to a bit more than 1,400 meters. There are probably three or four holes that disproportionately contribute to that total.
Peter Bell: Are the shallower holes around 100-200 meters?
Tim Marsh: Yes, they are typically 100-200 meters within mineralized material.
Peter Bell: And that mineralized material is sitting underneath some gravels at surface. Are those gravels typically 50-100 meters deep?
Tim Marsh: There are typically about 200 to 250 meters of gravel, which we don't assay.
Peter Bell: And I believe you are using water well holes with steel casings to get through the gravels more effectively.
Tim Marsh: That's right. We drill that for about $35 a foot as an all-in cost, which is very inexpensive. We also can get through that gravel zone in about 24 hours, which is very quick. Then, we case it off with steel casing and use the more expensive core drilling below that point.
Peter Bell: How is the cost of the core drilling?
Tim Marsh: It is over $100 per foot.
Peter Bell: Okay. Thank you very much, Tim. Maybe just a brief question about the option grants. Has your company issued the maximum possible amount of options? And are those options largely concentrated amongst yourself and other key people?
Tim Marsh: At the annual general meeting, the shareholders approved that we are allowed to issue up to 3,874,472 options. You'll notice that we left 1 million incentive stock options in reserve as an opportunity to offer those to officers or directors that we may want to appoint in the near future. The remaining 2.8 million incentive options that will be issued will go predominantly to one consultant to the company who's played a key role in marketing of Bell over the past six months. I, myself, am the second largest recipient of incentive options. I believe this decision reflects very strongly on our optimism for the future of the Kabba Project.
Peter Bell: Agreed. Thank you very much for this interview.
This document contains statements that are forward looking statements and are subject to various risks and uncertainties concerning the specific factors disclosed under the heading “Risk Factors” and elsewhere in the Company’s periodic filings with Canadian securities regulators. Such information contained herein represents management’s best judgment as of the date hereof based on information currently available. The Company does not assume the obligation to update any forward-looking statement.
The technical content of this release has been reviewed and approved by Timothy Marsh, PhD, PEng., the Company’s CEO, President, and Qualified Person. No mineral resource has yet been identified on the Kabba Project. There is no certainty that the present exploration effort will result in the identification of a mineral resource or that any mineral resource that might be discovered will prove to be economically recoverable.
Peter Bell has been compensated to prepare and distribute this promotional material.