Executive Summary
Cobre Limited (“Cobre”)(ASX:CBE) is exploring a stratiform copper prospect in the Kalahari Copper Belt (“KCB”) in Botswana. Cobre has signed a series of agreements that will enable it to earn 100% in a portfolio of licences through exploration and investment milestones.
Cobre has effective control of four project area in KCB: Okavango (2,720 km squared), Kitalnya East (2,650 km squared), Ngami (720 km squared) and Kitalnya West (2,900 km squared). All four of the areas are in close proximity to major discoveries. The target is the contact zone between two geological formations (deposited under oxidising and reducing conditions, respectively). The change in redox condition is typical for stratiform copper deposits such as the Kupferschiefer in Europe.
Cobre has advanced exploration by means of geophysical surveys, soil sampling and some stratigraphic drilling to defined drill targets. Recent drilling at Ngami has intersected wide zones of visible copper mineralisation in holes drilled 1 km apart along strike. The company has now committed itself to infill drill these holes to reduce the distance to 500 m, and will further reduce this to 250 m should results be positive.
Although no laboratory assays are yet available, hand-held X-ray Fluorescence (“XRF”) measurements taken at regular 25 cm intervals (therefore non-selective) have given attractive results between 0.1 % Cu and 5% Cu over downhole sections of 59 m in NCP07, 25 m in hole NCP08, 15 m in NCP09 and 13 m in hole NCP10.
The drillhole results indicate proof of concept of a major mineralising system. Given the hundreds of kilometres of strike length of the target horizon within the various concessions and the 57 drill targets currently defined, there could be district size discoveries. As the company has currently an Enterprise Value of approximately US$68 million, Crux Investor considers Cobre an attractive, albeit speculative, investment.
One or more of the authors of this report own shares in Cobre Limited.
Introduction
On 24 August 2020 Cobre agreed the acquisition of 51% of the equity of Kalahari Metals Limited (“KML”), a private UK company which controlled approximately 8,100 km squared of tenements within the Kalahari Copper Belt (“KCB”) in Botswana. The acreage is split into two blocks. One block, 6,650 km squared is owned 100% by KML. The second block of 1,450 km squared is owned 51% via Joint Venture arrangements with Metal Tiger Plc (“MTR”). The second block is referred to as the Triprop concessions. For the acquisition Cobre issued 21.4 million of its shares to KML, escrowed until 31 January 2022. The change of control was approval by the Ministry of Mines of Botswana in December 2021.
Figure 1 shows the tenement area in the Kalahari Copper Belt controlled by KML in relation to other active businesses in the area, notably Cupric Canyon Capital (“Cupric”) and Sandfire Resources (“Sandfire”).
Figure 1 shows the Triprop concessions in which Cobre holds only a 51% beneficial interest in grey and the wholly owned concessions in light blue.
The map also illustrates that KML’s landholdings are along strike, and adjacent to, two major development projects: Cupric Canyon’s high-grade Zone 5 Cu-Ag deposit and Sandfire’s T3 Motheo Cu-Ag deposit.
Figure 2 illustrates Metal Tiger interests in two concessions, directly and indirectly through their shareholding in KML.
Recently Cobre and MTR entered into a number of agreements to allow Cobre to get full control of the Triprop concessions:
- KML can earn-into the 49% interest in the Triprop concessions it does not already own. Step 1 is to spend US$0.8 million on exploration and issuing £60,000 to MTL in Cobre shares, to reach 80% total (51% + 19%). KML then has the option to acquire the remaining 20% based on an independent market valuation.
- Cobre can buy-out MTR shares in KML, an initial tranche of 24.5 percentage points of KML shares for £0.75 million, with an option to acquire the remaining 24.5 percentage points within one year of the initial acquisition for a consideration of an additional £0.75 million in cash of equivalent in Cobre shares.
MTR retains a conditional 2% net smelter royalty over all KML’s wholly-owned licences. The exploration licences owned by Triprop do not form part of the royalties.
Mineral Assets of Cobre
Cobre is an Australian listed company which was exclusively active within Australia until 2020 when it acquired its shareholding in KML. The Australian prospects Perrinvale and Sandiman are still actively being explored, but are now deemed of secondary importance to the Botswanan prospects.
Cobre also hold 15 million shares (14.43% of issued shares) in Armada Metals Limited (“Armada”), an Australian listed company (ASX:AMM) that is active in Gabon focused on magmatic sulphide Ni-Cu deposits in ultramafic rocks.
Table 1 summarises the assets owned by Cobre.
For the purposes of this note the prospects in Australia and Gabon are ignored, except for the market value of the shares in Armada.
Geology of the Kalahari Copper Belt
The Kalahari Copper Belt deposits in Botswana are located within the Ghanzi-Chobe Fold Belt, a 140 km-wide zone of deformed metavolcanic and metasedimentary rocks, which forms part of the late Proterozoic, Pan African Mobile Belt.
The Ghanzi-Chobe Fold Belt are part of the Ghanzi Group, a 5,500 m thick sequence of sedimentary rocks exposed along the NE trending Ghanzi Ridge. Figure 3 shows the location of the Ghanzi Ridge Within the Kalahari Copper Belt.
The lithostratigraphy of the Ghanzi Ridge commences with rhyolites and basalts, which are interpreted to have been deposited during the initial rifting stage of an intra-continental rift basin, followed by subsidence and down sagging of the basin along faults resulting in deposition of fluvial (= river) and volcaniclastic sediments above the volcanic rocks. The Ghanzi Group was deposited during a marine transgression.
It consists of Ngwako Pan (sandstones and wackes deposited in a shallow marine environment), D’Kar (typically silt stones and mid stones deposited in a deeper marine environment below wave action) and Mamuno Formations (typically arkosic sandstones deposited in an environment close to the shore). Importantly, the D’Kar Formation is characterised by reduced facies with abundant fine-grained pyrite and organic material, sometimes with sufficient carbon to be classified as black shales.
Mineralisation is distributed over a strike interval of up to 150 km and occurs typically within a thickness of up to 30 m within the finely laminated and chemically reduced mudstones and siltstones of the D'Kar Formation directly above the contact with the underlying oxidised arkoses and sandstones of the Ngwako Pan Formation. The contact zone of the two units is a redox contact and is a distinctive target horizon for Cu-Ag mineralisation. Figure 4 shows the metallogenic model for the mineralisation (bottom) and the gravity and magnetic expression (top).
Geology and Mineralisation of the Cobre Prospects, Botswana
Figure 1 shows that the Cobre tenement areas are “in a good address”, located along strike of a number of major discoveries.
Referring back to Figure 1, look at the Cupric Canyon Zone 5 project area towards the northeast of map. Note how the Plutus, Zeta and Mango deposits line up from northwest to southeast, across the general strike direction. The reason for this is that the geology is folded, with some portions of the target contact between the two formations being buried at depth, and other portions having been eroded. Figure 5, below, shows a schematic cross section to illustrate the location of Plutus, Zeta and Mango on the contact between Ngwako Pan Formation in yellow and D’Kar Formation in green.
The cross section illustrates that the more accessible portions of the mineralised contact is likely to occur where today’s erosional surface cuts the mineralised zone. Cobre will focus its exploration efforts on the near-surface mineralisation first, before targeting deeper zones.
Cobre also favours fold hinges and structurally controlled mineralisation where there is enrichment along the main contact horizon.
The Company has four main project areas, Okavango, Kitlanya East, Kitlanya West, and Ngami. Ngami is the site of the current drilling.
Ngami Copper Project
Recent exploration drilling at the Ngami Project area has returned promising results. Figure 6 shows a drill collar location plan with completed drill holes and planned in-fill holes.
The yellow stars on the plan are for the current 2,400 m drilling programme with holes spaced 1 km apart and targeting the Ngwako Pan Formation – D’Kar Formation contact zone.
The first hole NCP07 intersected 50 m of visible Cu mineralisation with a marked increase in abundance in the last 10 m above the contact. The visual logs were confirmed with handheld XRF spot measurements taken at regularly spaced 25 cm marks with values from 0.1 % Cu to 5% Cu.
NCP08 located 1 km southwest of NCP07 had visible mineralisation from 98 m downhole, increasing in abundance from 125 m after which a zone of significant chalcocite mineralisation was intersected between 135 m and 146 m. Visual logs were confirmed with handheld XRF spot measurements, taken on 25 cm marks, and 1 m composite samples which were taken by cutting a grove along the drill core and then analysing the composite powder with the XRF machine.
The drillhole in cross section is shown in Figure 7.
Crux Investor cautions that the readings with a handheld XRF cannot be given the weighting of laboratory assays, but the fact that numerous readings were made at regular intervals (= unbiased), gives comfort.
Okavango Copper Project
Figure 8 shows the defined drill targets within the Okavango Project area along strike of known deposits. The targets were not drilled in 2021.
Kitlanya East
At Kitlanya East Cobre has defined a number of targets by soil sampling that are within fold hinges and an interpreted imbricate fold-shear system with potential for mineralisation in local fold trap-sites and structures analogous to the neighbouring A4 and T3 deposits of Sandfire (see Figure 8, below).
Kitlanya West
Reprocessing of historical airborne electromagnetic and magnetic date identified three doubly plunging anticline targets, which were supported in a recently completed airborne electromagnetic survey and further supported by soil sampling anomalies (see Figure 9).
Enterprise Value of Cobre
Table 2 derives the Enterprise Value after a recent capital raising, of which the second tranche of A$1.5 is still pending shareholder approval of Metal Tiger Plc.
To derive the Enterprise value the value of cash and marketable securities must be deducted and obligations to obtain full control of all concessions added. Cobre has also guaranteed repayment of a shareholder loan from MTR to KML.
To the above must be added the outlay for a further 20% earn-in by KML into the Triprop concessions, but this is subject to an independent valuation in due course and cannot be quantified by Crux Investor.
Ignoring this, the table illustrates that the Enterprise Value of Cobre holding 100% of all Botswana concessions is approximately US$68 million, a number that would dramatically change even with moderate further exploration success.
If you are a Family Office investor, or an Institutional investor, and you would like the full report behind this article, please contact matthew@cruxinvestor.com
Executive Summary
Cobre Limited (“Cobre”)(ASX:CBE) is exploring a stratiform copper prospect in the Kalahari Copper Belt (“KCB”) in Botswana. Cobre has signed a series of agreements that will enable it to earn 100% in a portfolio of licences through exploration and investment milestones.
Cobre has effective control of four project area in KCB: Okavango (2,720 km squared), Kitalnya East (2,650 km squared), Ngami (720 km squared) and Kitalnya West (2,900 km squared). All four of the areas are in close proximity to major discoveries. The target is the contact zone between two geological formations (deposited under oxidising and reducing conditions, respectively). The change in redox condition is typical for stratiform copper deposits such as the Kupferschiefer in Europe.
Cobre has advanced exploration by means of geophysical surveys, soil sampling and some stratigraphic drilling to defined drill targets. Recent drilling at Ngami has intersected wide zones of visible copper mineralisation in holes drilled 1 km apart along strike. The company has now committed itself to infill drill these holes to reduce the distance to 500 m, and will further reduce this to 250 m should results be positive.
Although no laboratory assays are yet available, hand-held X-ray Fluorescence (“XRF”) measurements taken at regular 25 cm intervals (therefore non-selective) have given attractive results between 0.1 % Cu and 5% Cu over downhole sections of 59 m in NCP07, 25 m in hole NCP08, 15 m in NCP09 and 13 m in hole NCP10.
The drillhole results indicate proof of concept of a major mineralising system. Given the hundreds of kilometres of strike length of the target horizon within the various concessions and the 57 drill targets currently defined, there could be district size discoveries. As the company has currently an Enterprise Value of approximately US$68 million, Crux Investor considers Cobre an attractive, albeit speculative, investment.
One or more of the authors of this report own shares in Cobre Limited.
Introduction
On 24 August 2020 Cobre agreed the acquisition of 51% of the equity of Kalahari Metals Limited (“KML”), a private UK company which controlled approximately 8,100 km squared of tenements within the Kalahari Copper Belt (“KCB”) in Botswana. The acreage is split into two blocks. One block, 6,650 km squared is owned 100% by KML. The second block of 1,450 km squared is owned 51% via Joint Venture arrangements with Metal Tiger Plc (“MTR”). The second block is referred to as the Triprop concessions. For the acquisition Cobre issued 21.4 million of its shares to KML, escrowed until 31 January 2022. The change of control was approval by the Ministry of Mines of Botswana in December 2021.
Figure 1 shows the tenement area in the Kalahari Copper Belt controlled by KML in relation to other active businesses in the area, notably Cupric Canyon Capital (“Cupric”) and Sandfire Resources (“Sandfire”).
Figure 1 shows the Triprop concessions in which Cobre holds only a 51% beneficial interest in grey and the wholly owned concessions in light blue.
The map also illustrates that KML’s landholdings are along strike, and adjacent to, two major development projects: Cupric Canyon’s high-grade Zone 5 Cu-Ag deposit and Sandfire’s T3 Motheo Cu-Ag deposit.
Figure 2 illustrates Metal Tiger interests in two concessions, directly and indirectly through their shareholding in KML.
Recently Cobre and MTR entered into a number of agreements to allow Cobre to get full control of the Triprop concessions:
- KML can earn-into the 49% interest in the Triprop concessions it does not already own. Step 1 is to spend US$0.8 million on exploration and issuing £60,000 to MTL in Cobre shares, to reach 80% total (51% + 19%). KML then has the option to acquire the remaining 20% based on an independent market valuation.
- Cobre can buy-out MTR shares in KML, an initial tranche of 24.5 percentage points of KML shares for £0.75 million, with an option to acquire the remaining 24.5 percentage points within one year of the initial acquisition for a consideration of an additional £0.75 million in cash of equivalent in Cobre shares.
MTR retains a conditional 2% net smelter royalty over all KML’s wholly-owned licences. The exploration licences owned by Triprop do not form part of the royalties.
Mineral Assets of Cobre
Cobre is an Australian listed company which was exclusively active within Australia until 2020 when it acquired its shareholding in KML. The Australian prospects Perrinvale and Sandiman are still actively being explored, but are now deemed of secondary importance to the Botswanan prospects.
Cobre also hold 15 million shares (14.43% of issued shares) in Armada Metals Limited (“Armada”), an Australian listed company (ASX:AMM) that is active in Gabon focused on magmatic sulphide Ni-Cu deposits in ultramafic rocks.
Table 1 summarises the assets owned by Cobre.
For the purposes of this note the prospects in Australia and Gabon are ignored, except for the market value of the shares in Armada.
Geology of the Kalahari Copper Belt
The Kalahari Copper Belt deposits in Botswana are located within the Ghanzi-Chobe Fold Belt, a 140 km-wide zone of deformed metavolcanic and metasedimentary rocks, which forms part of the late Proterozoic, Pan African Mobile Belt.
The Ghanzi-Chobe Fold Belt are part of the Ghanzi Group, a 5,500 m thick sequence of sedimentary rocks exposed along the NE trending Ghanzi Ridge. Figure 3 shows the location of the Ghanzi Ridge Within the Kalahari Copper Belt.
The lithostratigraphy of the Ghanzi Ridge commences with rhyolites and basalts, which are interpreted to have been deposited during the initial rifting stage of an intra-continental rift basin, followed by subsidence and down sagging of the basin along faults resulting in deposition of fluvial (= river) and volcaniclastic sediments above the volcanic rocks. The Ghanzi Group was deposited during a marine transgression.
It consists of Ngwako Pan (sandstones and wackes deposited in a shallow marine environment), D’Kar (typically silt stones and mid stones deposited in a deeper marine environment below wave action) and Mamuno Formations (typically arkosic sandstones deposited in an environment close to the shore). Importantly, the D’Kar Formation is characterised by reduced facies with abundant fine-grained pyrite and organic material, sometimes with sufficient carbon to be classified as black shales.
Mineralisation is distributed over a strike interval of up to 150 km and occurs typically within a thickness of up to 30 m within the finely laminated and chemically reduced mudstones and siltstones of the D'Kar Formation directly above the contact with the underlying oxidised arkoses and sandstones of the Ngwako Pan Formation. The contact zone of the two units is a redox contact and is a distinctive target horizon for Cu-Ag mineralisation. Figure 4 shows the metallogenic model for the mineralisation (bottom) and the gravity and magnetic expression (top).
Geology and Mineralisation of the Cobre Prospects, Botswana
Figure 1 shows that the Cobre tenement areas are “in a good address”, located along strike of a number of major discoveries.
Referring back to Figure 1, look at the Cupric Canyon Zone 5 project area towards the northeast of map. Note how the Plutus, Zeta and Mango deposits line up from northwest to southeast, across the general strike direction. The reason for this is that the geology is folded, with some portions of the target contact between the two formations being buried at depth, and other portions having been eroded. Figure 5, below, shows a schematic cross section to illustrate the location of Plutus, Zeta and Mango on the contact between Ngwako Pan Formation in yellow and D’Kar Formation in green.
The cross section illustrates that the more accessible portions of the mineralised contact is likely to occur where today’s erosional surface cuts the mineralised zone. Cobre will focus its exploration efforts on the near-surface mineralisation first, before targeting deeper zones.
Cobre also favours fold hinges and structurally controlled mineralisation where there is enrichment along the main contact horizon.
The Company has four main project areas, Okavango, Kitlanya East, Kitlanya West, and Ngami. Ngami is the site of the current drilling.
Ngami Copper Project
Recent exploration drilling at the Ngami Project area has returned promising results. Figure 6 shows a drill collar location plan with completed drill holes and planned in-fill holes.
The yellow stars on the plan are for the current 2,400 m drilling programme with holes spaced 1 km apart and targeting the Ngwako Pan Formation – D’Kar Formation contact zone.
The first hole NCP07 intersected 50 m of visible Cu mineralisation with a marked increase in abundance in the last 10 m above the contact. The visual logs were confirmed with handheld XRF spot measurements taken at regularly spaced 25 cm marks with values from 0.1 % Cu to 5% Cu.
NCP08 located 1 km southwest of NCP07 had visible mineralisation from 98 m downhole, increasing in abundance from 125 m after which a zone of significant chalcocite mineralisation was intersected between 135 m and 146 m. Visual logs were confirmed with handheld XRF spot measurements, taken on 25 cm marks, and 1 m composite samples which were taken by cutting a grove along the drill core and then analysing the composite powder with the XRF machine.
The drillhole in cross section is shown in Figure 7.
Crux Investor cautions that the readings with a handheld XRF cannot be given the weighting of laboratory assays, but the fact that numerous readings were made at regular intervals (= unbiased), gives comfort.
Okavango Copper Project
Figure 8 shows the defined drill targets within the Okavango Project area along strike of known deposits. The targets were not drilled in 2021.
Kitlanya East
At Kitlanya East Cobre has defined a number of targets by soil sampling that are within fold hinges and an interpreted imbricate fold-shear system with potential for mineralisation in local fold trap-sites and structures analogous to the neighbouring A4 and T3 deposits of Sandfire (see Figure 8, below).
Kitlanya West
Reprocessing of historical airborne electromagnetic and magnetic date identified three doubly plunging anticline targets, which were supported in a recently completed airborne electromagnetic survey and further supported by soil sampling anomalies (see Figure 9).
Enterprise Value of Cobre
Table 2 derives the Enterprise Value after a recent capital raising, of which the second tranche of A$1.5 is still pending shareholder approval of Metal Tiger Plc.
To derive the Enterprise value the value of cash and marketable securities must be deducted and obligations to obtain full control of all concessions added. Cobre has also guaranteed repayment of a shareholder loan from MTR to KML.
To the above must be added the outlay for a further 20% earn-in by KML into the Triprop concessions, but this is subject to an independent valuation in due course and cannot be quantified by Crux Investor.
Ignoring this, the table illustrates that the Enterprise Value of Cobre holding 100% of all Botswana concessions is approximately US$68 million, a number that would dramatically change even with moderate further exploration success.
If you are a Family Office investor, or an Institutional investor, and you would like the full report behind this article, please contact matthew@cruxinvestor.com
Executive Summary
Cobre Limited (“Cobre”)(ASX:CBE) is exploring a stratiform copper prospect in the Kalahari Copper Belt (“KCB”) in Botswana. Cobre has signed a series of agreements that will enable it to earn 100% in a portfolio of licences through exploration and investment milestones.
Cobre has effective control of four project area in KCB: Okavango (2,720 km squared), Kitalnya East (2,650 km squared), Ngami (720 km squared) and Kitalnya West (2,900 km squared). All four of the areas are in close proximity to major discoveries. The target is the contact zone between two geological formations (deposited under oxidising and reducing conditions, respectively). The change in redox condition is typical for stratiform copper deposits such as the Kupferschiefer in Europe.
Cobre has advanced exploration by means of geophysical surveys, soil sampling and some stratigraphic drilling to defined drill targets. Recent drilling at Ngami has intersected wide zones of visible copper mineralisation in holes drilled 1 km apart along strike. The company has now committed itself to infill drill these holes to reduce the distance to 500 m, and will further reduce this to 250 m should results be positive.
Although no laboratory assays are yet available, hand-held X-ray Fluorescence (“XRF”) measurements taken at regular 25 cm intervals (therefore non-selective) have given attractive results between 0.1 % Cu and 5% Cu over downhole sections of 59 m in NCP07, 25 m in hole NCP08, 15 m in NCP09 and 13 m in hole NCP10.
The drillhole results indicate proof of concept of a major mineralising system. Given the hundreds of kilometres of strike length of the target horizon within the various concessions and the 57 drill targets currently defined, there could be district size discoveries. As the company has currently an Enterprise Value of approximately US$68 million, Crux Investor considers Cobre an attractive, albeit speculative, investment.
One or more of the authors of this report own shares in Cobre Limited.
Introduction
On 24 August 2020 Cobre agreed the acquisition of 51% of the equity of Kalahari Metals Limited (“KML”), a private UK company which controlled approximately 8,100 km squared of tenements within the Kalahari Copper Belt (“KCB”) in Botswana. The acreage is split into two blocks. One block, 6,650 km squared is owned 100% by KML. The second block of 1,450 km squared is owned 51% via Joint Venture arrangements with Metal Tiger Plc (“MTR”). The second block is referred to as the Triprop concessions. For the acquisition Cobre issued 21.4 million of its shares to KML, escrowed until 31 January 2022. The change of control was approval by the Ministry of Mines of Botswana in December 2021.
Figure 1 shows the tenement area in the Kalahari Copper Belt controlled by KML in relation to other active businesses in the area, notably Cupric Canyon Capital (“Cupric”) and Sandfire Resources (“Sandfire”).
Figure 1 shows the Triprop concessions in which Cobre holds only a 51% beneficial interest in grey and the wholly owned concessions in light blue.
The map also illustrates that KML’s landholdings are along strike, and adjacent to, two major development projects: Cupric Canyon’s high-grade Zone 5 Cu-Ag deposit and Sandfire’s T3 Motheo Cu-Ag deposit.
Figure 2 illustrates Metal Tiger interests in two concessions, directly and indirectly through their shareholding in KML.
Recently Cobre and MTR entered into a number of agreements to allow Cobre to get full control of the Triprop concessions:
- KML can earn-into the 49% interest in the Triprop concessions it does not already own. Step 1 is to spend US$0.8 million on exploration and issuing £60,000 to MTL in Cobre shares, to reach 80% total (51% + 19%). KML then has the option to acquire the remaining 20% based on an independent market valuation.
- Cobre can buy-out MTR shares in KML, an initial tranche of 24.5 percentage points of KML shares for £0.75 million, with an option to acquire the remaining 24.5 percentage points within one year of the initial acquisition for a consideration of an additional £0.75 million in cash of equivalent in Cobre shares.
MTR retains a conditional 2% net smelter royalty over all KML’s wholly-owned licences. The exploration licences owned by Triprop do not form part of the royalties.
Mineral Assets of Cobre
Cobre is an Australian listed company which was exclusively active within Australia until 2020 when it acquired its shareholding in KML. The Australian prospects Perrinvale and Sandiman are still actively being explored, but are now deemed of secondary importance to the Botswanan prospects.
Cobre also hold 15 million shares (14.43% of issued shares) in Armada Metals Limited (“Armada”), an Australian listed company (ASX:AMM) that is active in Gabon focused on magmatic sulphide Ni-Cu deposits in ultramafic rocks.
Table 1 summarises the assets owned by Cobre.
For the purposes of this note the prospects in Australia and Gabon are ignored, except for the market value of the shares in Armada.
Geology of the Kalahari Copper Belt
The Kalahari Copper Belt deposits in Botswana are located within the Ghanzi-Chobe Fold Belt, a 140 km-wide zone of deformed metavolcanic and metasedimentary rocks, which forms part of the late Proterozoic, Pan African Mobile Belt.
The Ghanzi-Chobe Fold Belt are part of the Ghanzi Group, a 5,500 m thick sequence of sedimentary rocks exposed along the NE trending Ghanzi Ridge. Figure 3 shows the location of the Ghanzi Ridge Within the Kalahari Copper Belt.
The lithostratigraphy of the Ghanzi Ridge commences with rhyolites and basalts, which are interpreted to have been deposited during the initial rifting stage of an intra-continental rift basin, followed by subsidence and down sagging of the basin along faults resulting in deposition of fluvial (= river) and volcaniclastic sediments above the volcanic rocks. The Ghanzi Group was deposited during a marine transgression.
It consists of Ngwako Pan (sandstones and wackes deposited in a shallow marine environment), D’Kar (typically silt stones and mid stones deposited in a deeper marine environment below wave action) and Mamuno Formations (typically arkosic sandstones deposited in an environment close to the shore). Importantly, the D’Kar Formation is characterised by reduced facies with abundant fine-grained pyrite and organic material, sometimes with sufficient carbon to be classified as black shales.
Mineralisation is distributed over a strike interval of up to 150 km and occurs typically within a thickness of up to 30 m within the finely laminated and chemically reduced mudstones and siltstones of the D'Kar Formation directly above the contact with the underlying oxidised arkoses and sandstones of the Ngwako Pan Formation. The contact zone of the two units is a redox contact and is a distinctive target horizon for Cu-Ag mineralisation. Figure 4 shows the metallogenic model for the mineralisation (bottom) and the gravity and magnetic expression (top).
Geology and Mineralisation of the Cobre Prospects, Botswana
Figure 1 shows that the Cobre tenement areas are “in a good address”, located along strike of a number of major discoveries.
Referring back to Figure 1, look at the Cupric Canyon Zone 5 project area towards the northeast of map. Note how the Plutus, Zeta and Mango deposits line up from northwest to southeast, across the general strike direction. The reason for this is that the geology is folded, with some portions of the target contact between the two formations being buried at depth, and other portions having been eroded. Figure 5, below, shows a schematic cross section to illustrate the location of Plutus, Zeta and Mango on the contact between Ngwako Pan Formation in yellow and D’Kar Formation in green.
The cross section illustrates that the more accessible portions of the mineralised contact is likely to occur where today’s erosional surface cuts the mineralised zone. Cobre will focus its exploration efforts on the near-surface mineralisation first, before targeting deeper zones.
Cobre also favours fold hinges and structurally controlled mineralisation where there is enrichment along the main contact horizon.
The Company has four main project areas, Okavango, Kitlanya East, Kitlanya West, and Ngami. Ngami is the site of the current drilling.
Ngami Copper Project
Recent exploration drilling at the Ngami Project area has returned promising results. Figure 6 shows a drill collar location plan with completed drill holes and planned in-fill holes.
The yellow stars on the plan are for the current 2,400 m drilling programme with holes spaced 1 km apart and targeting the Ngwako Pan Formation – D’Kar Formation contact zone.
The first hole NCP07 intersected 50 m of visible Cu mineralisation with a marked increase in abundance in the last 10 m above the contact. The visual logs were confirmed with handheld XRF spot measurements taken at regularly spaced 25 cm marks with values from 0.1 % Cu to 5% Cu.
NCP08 located 1 km southwest of NCP07 had visible mineralisation from 98 m downhole, increasing in abundance from 125 m after which a zone of significant chalcocite mineralisation was intersected between 135 m and 146 m. Visual logs were confirmed with handheld XRF spot measurements, taken on 25 cm marks, and 1 m composite samples which were taken by cutting a grove along the drill core and then analysing the composite powder with the XRF machine.
The drillhole in cross section is shown in Figure 7.
Crux Investor cautions that the readings with a handheld XRF cannot be given the weighting of laboratory assays, but the fact that numerous readings were made at regular intervals (= unbiased), gives comfort.
Okavango Copper Project
Figure 8 shows the defined drill targets within the Okavango Project area along strike of known deposits. The targets were not drilled in 2021.
Kitlanya East
At Kitlanya East Cobre has defined a number of targets by soil sampling that are within fold hinges and an interpreted imbricate fold-shear system with potential for mineralisation in local fold trap-sites and structures analogous to the neighbouring A4 and T3 deposits of Sandfire (see Figure 8, below).
Kitlanya West
Reprocessing of historical airborne electromagnetic and magnetic date identified three doubly plunging anticline targets, which were supported in a recently completed airborne electromagnetic survey and further supported by soil sampling anomalies (see Figure 9).
Enterprise Value of Cobre
Table 2 derives the Enterprise Value after a recent capital raising, of which the second tranche of A$1.5 is still pending shareholder approval of Metal Tiger Plc.
To derive the Enterprise value the value of cash and marketable securities must be deducted and obligations to obtain full control of all concessions added. Cobre has also guaranteed repayment of a shareholder loan from MTR to KML.
To the above must be added the outlay for a further 20% earn-in by KML into the Triprop concessions, but this is subject to an independent valuation in due course and cannot be quantified by Crux Investor.
Ignoring this, the table illustrates that the Enterprise Value of Cobre holding 100% of all Botswana concessions is approximately US$68 million, a number that would dramatically change even with moderate further exploration success.
If you are a Family Office investor, or an Institutional investor, and you would like the full report behind this article, please contact matthew@cruxinvestor.com
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