Water and Perception
Feb 10th the city of Santa Rosa in El Oro (in English "The Gold") province of Ecuador had 1000 people get sick. The Santa Rosa water system immediately said it wasn't bacteria or viruses and said they were sending water off to be tested for heavy metals. Local papers were quick to imply mining might be to blame. Ecuadorian television news ran footage from "El Guyabo" exact location unknown of some dirty looking ponds being directly discharged into a creek. El Oro province has historically been very pro mining, but there is nothing like 1,000 sick people and some ugly video footage to turn a lot of people angry.
It turns out that the 1000 sick people was caused by a bacterial infection and not by mining runoff. Heavy metal tests were perfectly normal. I expect that the larger companies in the region are operating in an environmentally responsible manner. However, there are lots of illegal, artisanal, and other operators in the region that may not all be operating with the highest of environmental standards. If one of these were to discharge directly into a creek that feeds into a river that is the source of drinking water for a city like Santa Rosa I guarantee the outrage would be directed at all mining companies in the region and not just the offender.
To make matters worse even though mining was cleared by water tests the mayor of Santa Rosa gave an interview where he suggested that they might want to have an anti-mining referendum similar to the one in Cuenca.
It would be in their own self-interest if the big companies started coordinating together to do some regional water quality monitoring beyond their own operations. In addition, a program to map illegal and artisanal mining in the region would help prevent potential problems before they become a big problem for everyone.
It's always nice when you do a step out hole over 1km away and hit wide intervals of mineralization that may be contiguous with your previous impressive drill results. So well done and good news for Solaris.
However, I do wonder why Solaris chose to fly ZTEM geophysics after and not before drilling. This 933m hole at $300/m probably cost $300,000 USD. ZTEM, like MobileMT I have mentioned before, gives conductivity information to great depth. Looking at figure 2 all their amazing holes intersected the big pink blob from their ZTEM geophysics. This latest hole had lower grade and was right next to the big pink blob. If Solaris had the ZTEM results before and had even used the same collar location might they have angled the hole into the big pink blog instead of away from it? And if they had done that might they have hit higher grade mineralization? I expect with 12 active drill rigs we will discover the answer to that question soon enough.
Solaris then released another 5 holes from Wartinza Central bringing their total there to 13. Holes 1, 2, 10, & 13 are clustered very close together and have copper equivalent percentage around 1%. The worst holes from Wartinza Central are 0.5% copper. It's worth comparing these
As I thought was likely and covered previously First Quantum decided not to go forward with the joint venture with Lucky. I look at this timeline and for myself regardless of the prospectivity of the project I cross this off my potential investment list. I expect some investors will have some very hard questions for Lucky's management.
??? - Lucky finds out First Quantum is going to pull out of joint venture
January 13, 2021 - Lucky announces a very large raise relative to their current market cap
January 23, 2021 - Joint Venture between Lucky and First Quantum Expires without announcement
Febuary 22, 2021 - Lucky Closes Private Placement
Febuary 23, 2021 - Lucky Announces First Quantum Pulling Out of joint venture
I read a lot of press releases of drill results from companies and this is the first time I find myself without an opinion. I think the assays in this press release are from re-assaying of historical holes by previous companies, but after reading through it twice I can't say that with confidence. My best guess is that Titan is doing new drilling but no assays from that new drilling are included in this press release.
As to the numbers themselves I also don't have an opinion. The individual width x grade numbers don't wow me, but there are a lot of intercepts because there appear to be a lot of veins. If these intercepts were for a potential underground mine I would be skeptical, but this project in the past was mined open pit and likely would be mined open pit again. If it is easy to tell the waste rock from the ore veins during mining the grade in the veins would be great for open pit mining and could justify shuffling around all the waste rock between the veins. I hear they make ore sorters that do a wonderful job separating waste rock from ore in a way that wasn't even possible a few years ago. Somebody with more expertise than me will have to think about grade dilution and strip ratios to form an educated opinion on the project.
Quick News Summaries
I'm a big fan of MobileMT for geophysics, seeing it as an improved version of ZTEM. Aurania made a nice video about MobileMT that's worth 3.5 minutes of your time.
With Copper at $4.30/lb all exploration and mining companies would like to remind you of their exposure to coppper and would like their stock to trade higher than it currently does.
Salazar and Adventus release infill holes CURI-352 to CURI-355. Results were good as to be expected from the first 351 holes.
Luminex Does a Webinar. We haven't heard a lot of news from them so I thought I'd mention it. Maybe I should add a section to future news roundups including company interviews and webinars.
In previous news roundups I didn't disclose my investment positions because I try not to let them influence what I write and because I think investors should do their own homework. Also, there are lots of good investments I'm not invested in and some of my investments will not work out well. I didn't want readers to dismiss genuinely good news coming out of a company I'm not invested in or ignore bad news out of a company I am invested in. I also didn't want the guilt of somebody following me into an investment and losing their shirt on it.
However, I've seen a lot of conflict of interest in the mining industry, especially of late. So going forward I will at the bottom of each article disclose any positions in the discussed companies at the time of writing. On balance more disclosure is probably better even though it isn't without downsides.
Of the companies mentioned in this article I have long positions in Salazar and Aurania that were purchased in the public markets. I have not received any compensation or special access to private placements from any of the companies discussed.