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Why John Kaiser Likes Copper-Gold Optionality Plays
Feb. 19, 2017 07:30PM PSTBase Metals Investing
He mentions one BC-focused copper-gold optionality play that he’s particularly keen on.
“Copper doesn’t really have any super exciting upside,” says John Kaiser of Kaiser Research in the interview above. But that doesn’t mean there aren’t opportunities for investors to profit.
He’s interested in high-grade copper exploration, and in “copper systems that are copper-gold systems.” As he notes in the video, “copper-gold optionality plays where you can get maybe a gradual rise out of copper, but a better bump out of gold. Those are interesting.”
He’s particularly keen on Serengeti Resources (TSXV:SIR), which is focused on the Kwanika copper-gold project in BC. Daewoo Minerals Canada is Serengeti’s joint venture partner on Kwanika, and Kaiser says a new preliminary assessment for the project will be released in the next six weeks.
“They have expansion potential, and of course if gold goes up … that will drag that deposit into the money,” he says.
Watch the full interview above to learn more about Serengeti Resources and the copper market as a whole. You can also read the transcript below.
JK: You mentioned copper, and copper doesn’t really have any super exciting upside. In this past cycle there were a lot of takeover bids of copper deposits. There’s a lot of inventory there, especially in South America, that can be developed. So copper optionality plays — I’m not very interested in copper exploration. For high-grade copper, that’s very interesting. [Robert] Friedland’s new Ivanhoe Mines (TSX:IVN) found the Kamoa deposit in the Democratic Republic of Congo (DRC) in the Central African Copperbelt, and that’s fabulous. And they found an even better deposit within this system called Kakula — just extraordinary grades type of thing. But this is based in the DRC, and the DRC is probably the most geopolitically unstable country in the world.
I like copper systems which are copper-gold systems. So copper-gold optionality plays where you can get maybe a gradual rise out of copper, but a better bump out of gold. Those are interesting. One of the picks I recommended last year is Serengeti Resources, which found the Kwanika copper-gold deposit in the last cycle and finished a PEA on it … it turned out it doesn’t work at the [current] prices. But a Korean company, Daewoo, has a deal where they can earn up to 35 percent. They revisited it last year, they did more geophysics. They’ve got an IP anomaly offset from the main zone, which if it’s enriched with gold-copper, then they have something even bigger, [and] potentially better, than what I’ve heard they’re already working on.
They are coming out with a new PEA in the next six weeks … as a result of rethinking the orientation of the mineralization and so on they’ve come up with a better understanding of what makes this deposit tick. They have expansion potential, and of course if gold goes up — and this has a very strong gold credit — that will drag that deposit into the money.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in contributed article. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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