Shares of NGEx Minerals (TSXV: NGEX) soared nearly 20% on Wednesday after the company announced promising results from a drilling campaign at its Lunahuasi project in Argentina. The results revealed a larger-than-expected porphyry system, further enhancing the project’s long-term potential.
Drillhole DPDH027, located at the Lunahuasi site, intersected 0.52% copper and 0.32 grams of gold per tonne over 1,619.4 meters, from a depth of 385.6 meters to 2,005 meters. The hole ended in open potassic-altered diorite porphyry, expanding the size of the system and opening up new exploration targets west of the known high-sulphidation veins.
NGEx completed 25,003 meters of Phase 3 drilling on May 8. The company is expecting assay results for the remaining 10,369 meters across 12 holes by mid-2025. As part of its ongoing efforts, NGEx is refining its targets and exploring potential partnerships for prefeasibility studies.
“This discovery unlocks an entirely new dimension of the Lunahuasi project, significantly increasing its long-term value,” said Wojtek Wodzicki, President and CEO of NGEx, in a press release. “While our near-term focus will be on the high-grade vein system, the discovery of the porphyry system will enhance the overall project’s potential.”
Industry analysts have echoed Wodzicki’s optimism. Peter Bell, a mining analyst at Canaccord Genuity, noted that while the presence of the porphyry was expected, the discovery still provides significant long-term value. “The Lunahuasi project is located in a highly prospective region, and this discovery sets the stage for an exciting exploration story,” Bell said. “When compared to nearby projects such as Filo del Sol, this discovery only adds to the project’s appeal.”
Rene Cartier, a mining analyst at BMO Capital Markets, also highlighted the significance of the find. “The discovery confirms NGEx’s geological interpretation and opens up a large exploration target, offering long-term value,” Cartier said. “The deeper nature of the porphyry system provides flexibility for future exploration campaigns.”
A Growing Market for Copper
The discovery comes at a time when global copper inventories are at decade-low levels, driven by increasing demand for the metal due to the global push for electrification and renewable energy. As a result, investors are keen on projects that combine high-grade veins for near-term cash flow with bulk-tonnage porphyry systems for long-term scalability.
The dual-style mineralization at Lunahuasi fits this model perfectly, which helped drive NGEx’s strong market performance. The company’s stock jumped 17% to C$14.28 in late afternoon trading, bringing its market capitalization to around C$3 billion.
Lunahuasi is located in Argentina’s rapidly developing Vicuña district, just 6 km north of Lundin Mining’s (TSX: LUN) and BHP’s (ASX: BHP) joint Filo del Sol deposit, and 8 km west of Lundin’s Josemaría project. Both of these are major copper-gold deposits nearing prefeasibility or construction. McEwen Mining’s Los Azules and Lundin’s Fruta del Norte, located just over the border in Ecuador, further illustrate the region’s growing importance in the global copper market.
Argentina’s San Juan province has recently made moves to attract foreign investment by cutting mining royalties and improving foreign-exchange repatriation, which is benefiting major explorers like NGEx. The company’s progress mirrors that of other successful ventures in the area, including Filo del Sol, which reported impressive drilling results in May 2021.
High-Grade Intervals and Promising Future Exploration
Drillhole DPDH027 revealed several notable high-grade sections, including 876.4 meters averaging 0.59% copper and 0.48 grams of gold per tonne in high-sulphidation mineralization. A deeper interval of 743 meters graded 0.44% copper and 0.13 grams of gold per tonne in porphyry-style mineralization. These results underscore the potential of the Lunahuasi project, which shows a clear shift in mineralization types as drilling progresses.
Additional drillholes continued to show promise. Hole DPDH028 intersected 53.5 meters at 7.79% copper-equivalent, including 3.89% copper and 2.96 grams of gold per tonne. Hole DPDH029 reported 157 meters at 2.16% copper-equivalent, or 1.67% copper and 0.49 grams of gold per tonne. The deposit remains open in all directions, with each hole returning multiple mineralized intervals.
As NGEx continues its exploration efforts at Lunahuasi, the company’s future prospects look bright, with substantial potential for both high-grade veins and large-scale porphyry systems to drive further growth and shareholder value.
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