Chile Experiences New Wave of Exploration

Copper and gold projects in Chile have attracted the attention of major companies, indicating a renewed interest in exploration. Goldcorp’s acquisition of Exeter Resource Corporation and Teck’s purchase of Copaquire project from Chilean Metals are notable examples of this trend. Despite these transactions, Chilean Metals still holds five properties, with the Zulema copper-gold project being a priority due to its resemblance to Lundin Mining’s Candelaria mine.


TriMetals Mining is planning a 20,000-meter drilling program for its Escalones copper project, which already has a published 43-101 resource. The company aims to advance the project to the pre-feasibility stage and is open to potential equity partnerships or joint ventures to facilitate development. Hot Chili has completed a pre-feasibility study on its Productora copper-gold project, with a total investment of US$100 million. The company, along with its joint venture partner Compañía Minera del Pacífico, commenced a drilling program to expand the mine life and prepare for a definitive feasibility study. Altiplano Minerals is nearing production with its Farellon and Maria Luisa projects, acquired through a joint venture with Comet Exploration. Significant progress in permitting and drilling by previous owners has accelerated the timeline for these projects. Altiplano aims to reach production at Farellon by the end of August 2017 and initiate drilling programs at Maria Luisa by the end of September 2017, with the goal of bringing both projects into production by the end of the year.


In addition to major companies, prospect generator companies like Mirasol Resources and Revelo Resources have taken advantage of favorable economic conditions to secure land claims in Chile. Mirasol has an active joint venture with Yamana Gold called the Gorbea joint venture, along with non-joint venture projects in northern Chile. The company plans to drill approximately 6,000 meters in Chile and Argentina by the end of 2017. Revelo Resources has signed agreements with Hochschild and Austral Gold for the option, sale, and exploration of several projects. The company’s portfolio includes 26 projects with 40 drill targets, with the Montezuma copper-gold project and Loro project being of particular interest.


Overall, the growing interest in copper and gold projects in Chile reflects a positive outlook for exploration and development in the region. Major companies and prospect generator companies alike are actively pursuing opportunities and partnerships to unlock the potential of these projects. Chile’s exploration potential is attracting international majors and companies with mining operations in other countries. Gold Fields, known for its mines in Peru, Ghana, South Africa, and Australia, is currently finalizing the pre-feasibility study for its Salares Norte gold project in Chile. Gold Fields has been actively working on Salares Norte since 2009, with significant drilling efforts and a gold discovery in 2011. Their strategy is to take the project into production themselves. Orosur Mining, the operator of the only producing mine in Uruguay, has also ventured into Chile by acquiring the early-stage gold asset, Anillo, through an earn-in agreement with CODELCO. Orosur has until 2022 to complete a pre-feasibility study, with funding from Asset Chile. They aim to eventually bring the asset into production or explore alternative options if it makes more sense.


Chile’s significance as a lithium producer should not be overlooked. The country holds the title of the world’s largest lithium producer, with the Salar de Atacama region alone containing 27% of global lithium reserves. SQM, a well-known player in the industry, is now joined by other companies exploring lithium opportunities. LiCo Energy Metals recently conducted a geophysical survey on the Purickuta project and plans to drill to a depth of 300 meters by the end of 2017. They are exploring direct extraction technology as an alternative to traditional evaporation pond models. Wealth Minerals is another newcomer to the Salar de Atacama, having acquired a significant land position in the region. In a relatively short time, Wealth Minerals has secured five projects, including Salar de Atacama, Laguna Verde, Trinity, Five Salars, and Seven Salars. Their joint venture partnership with Talison, operated by Albemarle, enhances their presence in the region.


Salar de Maricunga hosts the largest pre-production lithium project in Chile. Bearing Lithium, formerly Bearing Resources, acquired Li3 Energy and its 17.7% stake in the Maricunga lithium project. The joint venture, with ownership shared among Lithium Power International and Minera Salar Blanco, plans to complete a definitive feasibility study in 2018. The resource at Maricunga has shown significant growth, making it the highest-grade undeveloped lithium brine project globally.


Private equity investment in mining, though less common, is seen in politically stable jurisdictions like Chile. Denham Capital, an international private equity firm, has invested in Santiago Metals, whose flagship project, Delirio, is a copper porphyry system undergoing the permitting process. Mandalay Resources, set up by Plinian Capital, followed a private equity model with the acquisition and reopening of the Cerro Bayo mine in southern Chile. Minera Activa, a local Chilean private equity firm, focuses solely on Chilean mining projects and has achieved successful exits, such as the Dominga mine, which is now owned by Andes Iron. With the surge in copper prices and the continued demand for lithium, Chile’s exploration portfolio is expected to attract the investment capital needed to advance these projects. The proven quality of Chile’s deposits, combined with favorable market conditions, makes it an opportune time to invest in the potential major mines of the future.


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