Kincora Copper’s significant exploration position in the highly prospective Macquarie Arc gold-copper terrane of the Lachlan Fold Belt, its highly skilled team and multiple high-quality targets with Tier 1 potential have caught the eye of Bridge Street Capital Partners. 

The Sydney-based investment firm, which was joint lead manager in Kincora Copper’s (ASX:KCC) significantly oversubscribed $10m IPO, has initiated coverage on the junior explorer, which made its debut on the ASX at the end of March.

“We pick exploration companies very carefully, and typically back a good team in geological terranes capable of delivering Tier 1 discoveries,” executive director Roderick Clarkson said.

“KCC has an excellent team under CEO Sam Spring and ex RIO Chairman Cameron McRae.

“Key to the team is ex-Newcrest explorationist (and discoverer of Cadia), John Holliday, who has been in the Lachlan for many years (and lives in Orange).

“He was instrumental in selecting the RareX JV – most of the tenements he explored in the 1990s. But as ever, exploration fatigue (as he calls it) set in and Newcrest went elsewhere.”

Kincora, which is also listed on the TSX Venture Exchange, is currently drilling the only brownfield project, the Trundle project, held by a listed junior in what is now known as Australia’s foremost porphyry district. Initial drilling activities commenced in April 2020 at Trundle, which sits in the Northparkes intrusive complex that already hosts 5.5 million oz of gold and 4.5 million tonnes of copper at the neighbouring mine.

On Monday, Kincora announced a maiden first pass drill program had commenced at its Nyngan project to test two large-scale, early stage porphyry targets and confirm a strategic position in the underexplored northern extension of the Macquarie Arc.

Kincora has been awarded $120,000 under the New Frontiers Co-Operative Drilling Grants program from the NSW government for the drilling program.

The 100 per cent-owned Nyngan copper-gold project covers an area of 762sqkm in a highly prospective geologic terrane, with encouraging limited previous explorer drilling and increasing neighbouring drilling activities, including by both Fortescue Metals Group (ASX:FMG) and Canadian explorer Inflection Resources.

“The Boda discovery by Alkane provides proof of concept, confirming the underexplored northern extension of the parallel Molong belt,” John Holliday, technical committee chair, and Peter Leaman, senior vice president of exploration, said.

“Successful drill testing of Nyngan, or by other groups currently undertaking undercover drilling in the Junee-Narromine belt, will significantly enhance the wider prospectivity of this underexplored section of the belt.”

The Lachlan Fold Belt (LFB) is a world-class porphyry belt hosting over 100 million oz of gold and more than 24 million tonnes of copper.

Analyst Dr Chris Baker said in his initiation report on Kincora there was no question that NSW’s LFB could deliver world class orebodies.

“Cadia/Ridgeway, Northparkes and Cowal are three examples,” he noted.

“Exploration models are being refined by the geologists. Exploration budgets are now generous, and this is translating to discoveries. In our view it’s a matter of time before further significant discoveries are made.”

Newcrest Mining’s (ASX:NCM) Cadia/Ridgeway operation hosts 37 million oz of gold and 8.2 million tonnes of copper and is one of the largest and lowest cost mines globally.

“The LFB has shot to prominence over the past few years with the exciting porphyry gold-copper discovery, Boda, by Alkane Resources (ASX:ALK) in 2019,” Dr Baker said.

“As a result, drilling activity in the Belt has increased dramatically over the past 12 months.

“Kincora has established itself in the now blanket-pegged LFB, with exploration projects in its own right and through an earn-in with RareX Limited (REE:ASX).”

Bridge Street has chosen to back Kincora’s strategy for several reasons, including its attractive tenement package, which comprises largely ex-Newcrest projects, and the fact it has built a senior team of “mine finders” with good LFB experience.

“KCC starts life as an ASX-listed company with some $13m in cash and with two rigs drilling on key targets at Trundle in the same mineralised complex as Northparkes, Australia’s second largest porphyry mine,” he said.

“The board has excellent commercial acumen and is likely to seek new opportunities

within the LFB and value from within its current portfolio.

“With an EV of around $27m it appears relatively inexpensive in the current exploration-focused market.”

 

 

 

This article was developed in collaboration with Kincora Copper, 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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