• QMines receives firm commitments to raise $6m
  • Funds will be spent on copper projects in Queensland
  • A large drilling program will take place shortly

 

Special Report: With the promise of a supply deficit that BHP and others think is around the corner, copper stock QMines has timed its $6m placement perfectly to continue proving the scale of the Mt Chalmers and Develin Creek projects.

The two-tranche placement received strong demand from new and existing shareholders for the issue of more than 133.33m fully paid shares at 0.045c per share.

The first tranche will be issued within QMines’ (ASX:QML) existing 15% placement capacity while the second tranche’s shares will be issued subject to shareholder approval.

 

Copper project history

Develin Creek and Mt Chalmers are near Rockhampton, with the latter featuring a high-grade historic mine that produced 1.2Mt at 3.6g/t gold, 2.0% copper and 19g/t silver up to 1982.

Following six resource updates and the delivery of a pre-feasibility study, Mt Chalmers now has an ore reserve estimate of 9.6Mt at 0.65% copper, 0.48g/t gold, 0.27% zinc, 5.2g/t silver and 4.3% sulphur in the proved and probable categories.

Develin Creek on the other hand contains the high-grade Scorpion and Sulphide City deposits, as well as a resource of 3.2Mt at 1.05% copper, 1.22% zinc, 0.17g/t gold and 5.9g/t silver.

According to Stockhead’s very own ‘Garimpeiro’ columnist Barry FitzGerald, QML’s modest market cap of $18m makes it a standout, leveraged copper play.

“The current market cap is not a lot for a company on its way to becoming a 10,000-20,000tpa copper equivalent producer,” wrote FitzGerald.

“A re-rating seems to be in order, and it could be that 2025 will be the starting point.

“That potential was pretty much captured in a preliminary feasibility study on Mt Chalmers in April last year – a 10.4-year project costing a comparatively low $191m was shown to have a 1.8-year payback and a net present value of $373m.”

 

Large-scale drilling campaign

QML executive chairman Andrew Sparke said it is pleasing to see such strong demand for the placement.

“I want to sincerely thank new and existing shareholders for their support of our company as we continue to demonstrate the scale and development potential of the Mt Chalmers and Develin Creek projects,” he said.

“We will shortly begin a large drilling program at the Develin Creek project where the company has three high-grade copper-zinc deposits that has potential to grow the scale of a potential mining operation at Mt Chalmers.”

Sparke added the program will be targeting infill and extensional drilling, with a diamond drill rig currently mobilising to site.

 

 

 

This article was developed in collaboration with QMines, a Stockhead advertiser at the time of publishing.

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

 

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