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Fruta Del Norte, Alpala, and …? Dynasty emerges as one of Ecuador’s next big mine developments
Mining
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Special Report: Big money continues to flow into Ecuador’s embryonic mining sector. Titan Minerals (ASX:TTM) believes that its recently acquired +2moz Dynasty gold project is “in the frame” for near-term development.
In early May, $23.5bn gold miner Newcrest (ASX:NCM) shelled out ~$700m to increase its exposure to Fruta del Norte, Ecuador’s newest – and biggest – gold mine.
Less than two weeks later porphyry hunter SolGold (LON, TSX:SOLG) announced a $US150m funding deal with streaming company Franco Nevada.
Solgold’s advanced Alpala discovery in northern Ecuador is a tier 1 porphyry system, containing 10.9 million tonnes of copper, ~24moz of gold and 100moz of silver (and counting).
Both Newcrest and fellow mining major BHP (ASX:BHP) have been building large +14 per cent equity positions in SolGold since 2016/2017.
But they aren’t the only big Aussie companies sinking time and money into this exploration hotspot. Both Andrew Forrest’s Fortescue Metals Group (ASX:FMG) and Gina Rinehart’s private miner Hancock Prospecting are also very active in Ecuador.
There aren’t many big mining operations in Ecuador, yet. But running through the South American country is one the world’s most highly prospective (and underexplored) porphyry and epithermal copper-gold mineral belts.
The huge amounts of money and time invested by all these massive companies — global pandemic or not — speaks to a long-term confidence in this emerging mineral-rich jurisdiction.
ASX-listed Titan has a large, ~2moz and growing epithermal gold project called Dynasty in the country’s south.
History shows that when big money starts to flow into emerging ‘high-risk, high-reward’ mining jurisdictions like Ecuador the floodgates open, Titan Minerals exec director Matthew Carr says.
“It is a significant milestone to have that sort of investment coming into the country,” he says.
“Companies like Newcrest and BHP don’t make these investments lightly; they want to be in Ecuador for 20 years and longer.”
Carr says Alpala is shaping up as the next big development decision. Then Titan’s +2moz Dynasty gold project is in the frame.
With +$10m in the bank Titan is spring-loaded for a +12,000m drilling campaign at Dynasty – initially to convert it to a JORC-compliant resource, before ‘stepping out’ along the 9km of mostly untested strike to make it bigger.
“Dynasty is probably the next biggest already, to be honest,” Carr says.
“That’s why we are excited. We believe once we get the drill bit in, validate the resource, and get the technical capability behind it we will really firm up as Ecuador’s ‘Number 3’.
“Dynasty is a different geological style [to Fruta Del Norte] but we think it could potentially become a huge, bulk tonnage mine with higher-than-average grades around 3-4g/t.”
This is a ‘bottom of the market’ opportunity to get in on the ground floor, Carr says.
“Right now, COVID is capturing everyone’s attention but once we get clear of this, Ecuador will truly emerge as a standout mining and exploration destination.”
There are murmurings that Ecuador, which is shut down due to the COVID-19 pandemic, could look to start reopening its mining industry within weeks.
“We are just looking forward to getting the gates open so we can kick on and get drilling. People want to see drilling,” Carr says.
“We have already gone to tender on our drill contracts.
“We know the groups that we can engage with to start drilling as soon as we are allowed to mobilise to site.”
Separately, Titan has also received a number of indicative proposals over non-core assets.
“We have had a lot of interest,” Carr says.
“We are considering some of those at the moment. The only complication had been delays in people being able to start their due diligence.”
