Copper is hot. Silver is hotter.
So, it’s no surprise that there is currently a new “staking rush” in one of North America’s premier silver districts – which may be in the process of discovering
district scale copper porphyry mineralization.
Mining investors tuned into either copper or silver may already be familiar with
Hercules Silver Corp. (CAN:BIG). Hercules had already been attracting attention with the high-grade silver intercepts it had reported on its Hercules Silver Property in western Idaho.
That was no big surprise. Idaho is silver country.
Major copper discovery in silver country
Then, in October 2023, Hercules shocked the mining world by announcing
broad intercepts of porphyry-like copper mineralization beneath the silver mineralization it had been previously drilling.
The reaction to those drill results demonstrates that level of shock. BIG’s share price rocketed from <CAD$0.25 per share to as high as CAD$1.60 within a month – supported by more strong drilling intercepts.
At the same time, Barrick Gold Corporation (US:GOLD), which should really be renamed Barrick Copper and Gold Corporation, turned heads with its announcement of
a CAD$23 million strategic investment in Hercules.
Meanwhile, a new junior copper exploration company,
Zeus North America Mining Corp. (
CSE:ZEUS) just started trading and holds a large land package adjacent to Hercules. More on this later.
The headline drill hole that started the party for Hercules was this:
- 185 meters of 0.84% copper (Cu), 111 ppm molybdenum (Mo), and 2.6 g/t silver (Ag), including 45 meters of 1.94% Cu
A very thick intercept with equally robust grades. Other drill holes have produced similar numbers, though with grades not quite as strong.
Hercules’ most-recent
news release on its silver drilling was also very impressive.
- 112.2 meters of 193 g/t Ag, 0.2% lead (Pb), and 0.4% zinc (Zn)
The high-grade silver mineralization starts near surface. The copper porphyry mineralization starts ~240 meters below surface, but is
open at depth.
The tonnage potential of the high-grade silver is limited by the nature of the geology: constrained within roughly the first 200 meters of depth. Conversely, these thick intercepts of porphyry-like copper are not restricted in any way.
This means that while the high-grade silver could potentially be mined from the Hercules property at strong margins, what could be the real company-maker here is the potential for a large-scale bulk tonnage copper operation.
It’s not just the numbers alone that are generating the buzz around Hercules Silver.
The geological trend in which this mineralization is hosted is very large. The trend covers much of western Idaho and potentially extends into Oregon State.
Hercules itself has already demonstrated significant mineralization from several different targets on its property. Meanwhile, strong exploration potential exists for more copper/silver discoveries in western Idaho, turning this into a true “district scale” copper play.
Hercules Silver could still produce strong future returns for investors given its own development opportunity. However, with a market cap now above CAD$200 million, the easy money has already been made here.
The next contender in this mining district?
As activity heats up in this silver (and copper?) district of Idaho, mining investors with a more aggressive investment profile may be looking further down the food chain for the next potential contender in this region.
Enter
Zeus North America Mining Corp.
As an early entrant to the district, Zeus has staked out several large land packages in Idaho, including the Company’s Cuddy Mountain property – which management is positioning as Zeus’ flagship project.
Collectively, Zeus North America Mining Corp. holds 177 lode mining claims covering 3,822.1 acres. The properties are 100%-owned, subject to a 2% net smelter royalty (NSR).
While both Selway and Great Western have prospective potential for silver, lead, zinc and other metals, it’s Cuddy Mountain that is attracting interest among investors and within the mining industry.
The Cuddy Mountain property is adjacent to Hercules Silver and is part of the same geological trend that hosts this copper porphyry mineralization (and high-grade silver).
Two red-hot metals markets with strong fundamentals
It’s the copper market that is currently attracting the most media attention at the moment. The price of copper has surged strongly in recent weeks, recently hitting a 1-year high due to recent supply shocks and a decision by Chinese copper refiners to curb output.
However, it is the Big Picture in the copper market that will be most exciting for savvy investors.
Jakob Strausholm, CEO of multinational powerhouse Rio Tinto,
recently estimated that the copper market will have to add
4 million tonnes per year (Mtpa) more supply between now and 2035 – just to meet the massive copper demand from China.
Where is that supply going to come from?
There are significant copper projects in the global pipeline. But
John Forwood, chief investment officer for Australia-based Lowell Resources Fund predicts that it will require an
“incentive price” of USD$4.75 per pound for copper just to get those projects online.
That’s still roughly 20% above the current price for copper, despite its recent gains.
Even those additional pipeline projects will only cover a small portion of the copper that will be required by China – not to mention additional copper demand from the Rest of the World. Millions more tonnes of copper (per year) need to come from new discoveries and projects.
This has prompted Goldman Sachs to just declare that
“copper’s time is now”.
This is why the robust copper discovery of Hercules Silver has caused so much excitement. But the high-grade silver is also an important component of this equation.
Since hitting a near-term low on February 28th,
the price of silver has soared by more than 12% -- benefitting (as usual) from new strength in the gold market.
However, silver has spectacular supply/demand fundamentals of its own. Silver inventories are extremely tight, stretched by soaring investment and jewelry demand
from India, along with increasing quantities of silver required for
solar panels.
A unique copper/silver opportunity
Dean Besserer, President and CEO of Zeus North America Mining Corp., recently sat down for a chat with Dynamic Wealth Research. He connected the dots for investors regarding the geology of the Hercules Silver Property – and Cuddy Mountain.
Copper porphyry projects are world-famous for being the source of many of the world’s largest and most-lucrative copper mines. However, the copper grades in porphyry formations tend to be low to average.
In commercial terms, this generally means that porphyry deposits need to be near surface (and amenable to open pit mining) in order to demonstrate robust economic potential.
Even with the relatively strong grades of some of Hercules’ copper drilling intercepts, at a depth of >200 meters an open pit project would face a high strip ratio of waste rock above. And copper grades are probably not high enough to make an underground mining operation economical.
The high-grade silver is the game-changer in this equation.
Instead of needing to finance the removal of 200+ meters of waste rock just to begin open pit mining for copper, this “waste rock” can, itself, be a separate-and-profitable mining operation.
This is what makes the geology of this region so unique. Copper and silver mineralization often occur together. What is rare is to see strong grades and thick widths of mineralization of copper and silver in separate-but-adjacent geological formations.
Besserer explained to investors how the significance of this discovery looks here from the perspective of a mining executive.
“This historic silver district is only the ‘cherry on top’ of this previously unrecognized district-scale copper porphyry belt. The staking rush and presence of major mining companies at such an early stage re-iterates its significance.”
Dean Besserer, a professional geologist, has a keen perspective on the copper mining industry. His 30+ year career in mining spans more than 50 countries and is evenly split between mineral exploration and capital markets.
Besserer told Dynamic Wealth Research that following the Hercules discovery there has been a “staking rush” across much of Idaho, with most (all?) of the prospective land now claimed by now entrants to the district.
Zeus North America Mining Corp. only commenced trading on March 1, 2024, on the Canadian Stock Exchange (symbol “ZEUS”). The Company acquired the Idaho properties and raised an initial CAD$2 million.
As previously noted, the market cap for Hercules Silver has swollen to more than CAD$200 million following its exploration success. With less than 52 million shares outstanding, Zeus has a market cap of ~CAD$20 million – 1/10th the market cap of Hercules.
After Barrick’s $23 million strategic investment in Hercules, and with the two properties sitting on the same geology, experienced mining investors might suspect that there have already been other mining companies sniffing around the Cuddy Mountain Property.
Indeed, Besserer explained to Dynamic Wealth Research that it was Zeus’ intention to “fly under the radar” during the acquisition to give the Company some time to establish its exploration footprint. This gives mining investors the opportunity to get in early with Zeus.
With both the copper market and the silver market on fire, many mining investors will be looking to add exposure to both of these metals markets.
Zeus North America Mining Corp. offers investors strong exposure to both copper and silver, in what could be a new, major copper district in silver-rich Idaho.
Zeusminingcorp.com
DISCLOSURE: Zeus North America Mining Corp is a paid client of Dynamic Wealth Research.
