Callinex Mines (TSXV:CNX) - "Unlocking the Code" in Flin Flon Copper VMS District

[Music] hi I'm Max Porterfield president CEO of Ken X mines and we have emerging high-grade copper gold discoveries uh here outside of fln man TOA Oran Pond Max uh thank you for the introduction good to see you again uh I we were talking offline about your your new office you've you've moved in there so you haven't kind of got your Maps up on the wall yet and you're samples but uh good to see that you moved into a new office and it's been quite a year so um why don't we today uh just have a kind of a look back at what you've achieved during the year we can look at the terrible markets over the year and discuss how we're going to navigate that or how you're going to navigate that and drive value and then we can look a little bit about going forward so could you just kind of take us back to January 2023 you wrote a letter to shareholders um I think it was on the 17th of January and you said that you drilled by then 42,000 M and you'd gone down to about 800 M and kind of can you just kind of remind us what the plan was for the year yes so the plan was is that we entered uh 2023 with all the drilling necessary to publish a main resource estim at our Pine Bay project which hosts both the the rainbow deposit which is what you're mentioning as well as the Pine Bay deposit as well that predates our exploration work on the property uh so we also had a number of exploration targets to follow upon to discover I'm sorry new discovery and Alchemist uh and so we entered January of this past year I think with a lot of exciting news ahead of us and we really I think executed on all fronts to uh to reach those goals and I think even uh even more with the new discovery that we have that we're now stepping on on with descendant so um you know it's been a a tough year as you mentioned but we've we strengthened our team with adding Peter Jones we come Then followed up with a $9.4 million Capital raise which then led into our exploration Drilling and then the exploration drilling focused on stepping on our new discoveries and testing new disc new targets which led to the new discovery The Descendant so I'm very excited to have reached all that and and on the resource side of things I think we really exceeded expectations on the rainbow resource we put nearly 6 million tons on the P project of high grade mization 4.7 million T at Rainbow sorry sorry when you when you talk about just just for people who are not so familiar with the story you call the the whole thing Pine Bay right right that's correct and and within that one of the kind of these bodies um which is actually kind of three stacked very very closely stacked bodies but it's kind of one one basic kind of unit um that's the rainbow deposit that's correct yes so rainbow was a discovery that again we made in 2020 uh our first toll in August of that year and then we had done a couple of drill seasons on expanding and delineating that deposit so rainbow has been delineated from the roughly 100 meter level that's where it starts uh down to the 900 meter level it RS open at depth uh with that the resource that we published early this year's indicated inferred combining those two was 4.7 million tons and the indicated category was over was 3.44 million tons uh grading 3.62% copper equivalent in terms of copper grades we've also you know really shined on that front and uh copper grades in that resource for the the indicated category was 3.1 4% copper that's is indic indicative of how high grade uh these deposits out at our Pine Bay project are you also put out a c a million tons at 2.6 is% coer equivalent at Pine Bay so you've got these kind of these two resource level um projects and then you've gone on to drill you made a discovery of uh four sulfide zones as um at descendant and then you got another Target called Odin an alchemist um you did you remind me did you get to drill those during the course of this year so we were able to follow up on Alchemist so the single all wasn't ideally placed where we wanted it uh due to to access so really fallowing up there we need to be done in the winter uh ultimately led us to The Descendant discovery which is where we've got a drill that we're just wrapping up right now uh our drill season on and that's our newest Discovery and this is an area that quite frankly when we started exploring at Pine Bay going back to when I joined the company in 2014 uh was where we focused and this area of the property has been the focus of over a dozen exploration companies uh since really Inception of exploration at Pine Bay or even in fnf Exploration at where the descendant is located goes back to 1911 really earlier than predated the original discovery of the funlan deposit in 1914 uh there's always been the indicator based on the geology in the area that there should be a large deposit hosted in this area and the the last true operator the predated Kinex that explor the property plasdone applying for applied for a 30 million ton exploration Target in the this immediate area as well U they were briefly followed up with some work by inm who had over 20 million ton exploration Target based upon plers work and their own work and then we picked up the the torch so to speak in 2014 immediately focused on this area of the property for the same reasons plaster in meant everyone going back to 1911 did uh and we which it's the largest felic volcanic rock package in the entire Flint flown greenstone belt and it butts up against a very large alteration system that's ma in surface spans a minimum of 700 by 1100 M and so these alteration systems in these VMS when we looking for VMS deposits are indicative of the size of the deposit associated with them so the bigger alteration system the bigger the correlating deposit and if you look at Flyn flaud over 90% of the Min have been host in the Felix so You' got massive felsic volcanic rock package mapped at surface and within that felsic package you have a again this large alteration system and then you've got multiple uh near surface mineralization like the pine Bay deposit like the cabin deposit in the baker patent deposit near surface and it's very analogous to the Chisel Lake Basin and the Snow Lake Area the flfl greenstone belt another area of the belt we have a large felic package a number of smaller deposits a big alteration system and the missing giant was ultimately the Lawler mine well what is the Lawler mine today uh so again we had initially had a success in this area of the property in 2016 when we deepen to Historic plaster D whole 38 M uh that's when we hit over 11 M of nearly 7 copper 1.8 G per ton gold almost 6% zinc nearly 2 oz silver uh and then we stepped out vertically below that and we we weren't able to replicate weren't able to replicate we drilled the hole to the South hit about 3 m I'm sorry 2 and half M of 3% copper equivalent and um we took a time out and when we reentered the property we brought a new approach was using utilizing IP and that vectored us towards the rainbow deposit had the rainbow Discovery but we had unfinished business over here at this area of the property and that's when we now with the understanding of you know how is Rainbow sitting underground it's you know it's very near vertical very steeply dipping same for the pine Bay deposit same for what we're seeing in Alchemist so we brought that knowledge back back to the area of property that has always had the indicators with what we've now learned by spending so much time on the property and making these discoveries on other areas of it and then that's when we stepped out 250 M vertically below that that 2 and 1 half meter intersection I mentioned and that's when we hit the new new discovery of a descendant at depth there and these are similar depths that you see 777 similar depths you see Lawler and that was that that step down was driven by GE physics it was driven by kind of GE physical Target that was can I say 250 M below your 2 and a half met intercept was that the princip reason there there is a well the principal reason is geology uh I have to hand it to the technical team it was geology Focus yes he had the data there there is some support from geophysics certainly but coming back and having the confidence that hey we need to go and reapo much what we we've you know followed up on before uh based on what we've known it was was geology driven uh supported by geochemistry and Geo physics so I con I'm gu gives credit what credits do um and certainly it was a bold decision to drill the hole and and quite fridly uh Force varable to bold so I can actually if you know mind I can bring a a long section of that if you like up and you can just I can walk you through that yeah sure so again as I mentioned there was this near surface metalization called cabin up near surface on the property that was historic and you can see all these Pierce points on this Horizon known as the cabin Horizon Host this metalization that's the the period of time where that volcanic activity was active uh so this is that historic Placid hole that we deepened you know plas we felt that they used borle Yem they didn't have an approach ahead of the hole but based upon the historic drill logs we didn't believe they deepen the hole deep enough or team so that's when we deepen that hole yes can I just can I just ask you see that all those are hitting like the cabin uh zone now because this is a long section I can't see what's projected onto it and what's not is the cabin Zone kind of offset from where you're intersecting the mineralization or are you intersecting mineralization in the same Rock unit as the the cabin Zone same Rock unit as cabazone so this is each period point that you're seeing is on that statgraphic period of time that hosts the cabin Zone and all this mineralization you're seeing over here okay thank you so when we first drilled and deepen thater Plum hold you can see again that was a hole that was drilled in 93 284-3994 the third hole of that program um we deepen that all 38 M that's the 11 M that I mentioned earlier that high grade mization yeah High R hosted zinc dominant and that really is indic indicative that you're on the edge of the system or at the top of the system when you're getting more of the zinc than you're are getting the the copper you see that at rainbow rainbow when you're near surface at the top of rainbow you're going to get the zinc gold grades as you go more proximal at depth that's when your copper comes in so over here is where that 2 and2 m I mentioned a 3% copper equivalent came in yeah and then and then uh this is a historic actually uh inment hole that we had deepen again uh on the edge of it27 M of low grade mization so we had then understanding that rainbow is near vertical uh Alchemist is vertical Pi Bas vertical we then decided to do a step out vertically below sorry that last intersection you you're able to to use the holds that you had to do downhole um em and downhill IP uh we didn't use downhill IP we only use surface IP we have done downhill em uh we looked in the dental IP just don't believe it's probably the best tool for what we're working on here uh so that's the 250 M Step Out Below that's the four zones of mineralization that we hit uh and again that was all about the cut off grade but as I mentioned before it was Zinc dominant pyate hosted so again indicating that we still the top of this system we need to go deeper so what we're doing right now is is a couple holes that are going to come right about right here uh and that'll be you know pending news going into the new year so um quite excited to see the results of with these initial step out holes on this discovery um and again I think we're on on a path to building significant tonnage on this property in 2024 based upon this initial intersection if you look at Rainbow as I mentioned we we've drilled it it starts from the 100 me level down to the 900 M open it depth when you take the consideration this hole this hole and and the hole that we've you know set of holes we're looking to drill about 100 meter Step Up vertically below the initial Discovery hole you're going to have a vertical extent of over 350 M right which is nearly half the vertical extent right out of the gate of what you're seeing at Rainbow again with the vector being at depth based upon the mineralization we're seeing and other thing that we're excited about is the reason why we're Focus here is that we're hitting much wider intervals of metalization we hit four zones of metalization across 26 M roughly of Massa sulfides uh in this initial Discovery also if you compare that to Rainbow which is average met true fness about 8 m the potential is to add a significant amount of volume per vertical uh meter here at The Descendant Discovery uh as we move forward with expiration on the property so that's the is a way that can offer you uh a quick access to tons but let's let's just have a look at the kind of the market at the moment cuz the share price I mean you hit something like $4 uh 37 in April and you're now one uh 180ish uh at the end of the year I mean it's it's kind of two and a half times higher you you were two and a half times higher in April than you are now I it's been a terrible market for um the Juniors I spend a lot of time looking at the Copper space uh I'm not alone in thinking that the copper Market is pretty tight you can see that in inventory you can see that on the supply side with anglo-american tech Coby Panama you know there are so many examples of where the supply of copper is failing to deliver so yes we expect strong copper prices going forwards but that in itself can't be the Catalyst that you rely on you know what what do you think the market is going to need to see from the work that you do before it says hey this thing is it's a real value proposition well I think that we're doing that work with what we're routing at this year and that'll show you know it has potential to show moving forward uh where the big value Creator I think the difference is as we enter this year we're going to be in a much stronger position than we enter 2023 as we kind of started the compensation and if you recall as we entered 2023 we also were looking at $2 share price before we had a move to the $4 range as well uh and that was done uh and that was created with enthusiasm based upon the culmination drilling that led to the rainbow resource that I mentioned uh as well as uh you know strengthen our team and then outling the targets that ultimately led to our brander Discovery called descendant as we go into 2024 we're a much more favorable Market environment for the metal price environment as you mentioned which is obviously going to weigh on us in a positive or negative light let's be honest with ourselves here if you have a negative metal environment you know the equities are going to feels so great uh but with much stronger news we have a basis of nearly 6 million tons of highgrade mization on the proper property 4311 play and we did not have as we entered this year and we do have entering next year that is a base that's significant in terms of overall resources uh if you look at historic pass proty mines in the district of the 32 pass proty mines uh that Pi Bay resource is significant now we have a brain new uh discovery on the property we have step appels pending on the property as we go into the new year uh so I do believe that there's a strong ination potential that you know we've already done the work or we're working on the work the necessary that could lead us into a much stronger position to again recapitalize and then look forward to 2024 where I think ultimately we can grow a resource base very significantly very quickly uh just like we've shown you know what the initial resource we put out on Rainbow and we've got reason to believe that what we're on to at to send it could be significantly larger based upon the system that's present on the Discovery like kind of you spend a Time discussing today so while we've been in this position before and I'm quite confident we're going to be in a position as we move forward when when I was we when you had that long section up you know the depths of where the potentially uh the the more cooperate system were anything between I don't know 1 12200 and 1700 something like that um is that slow expensive drilling yeah well it's slow drilling but I think expensive is a Rel relative to word if you look at our Discovery all all in uh for the drill cost we were looking around $250 mean your Canadian uh so then you have the potential to start doing wedges off of those paranal as well so I think it's very very competitive particularly when you're looking at you know some of our peers that are Drilling in other areas of this country in Yukon for example at $700 a meter we're drill in Japan for3 4 $500 US a meter and let's you talk about the try to drill a hole in the United States of America as simple as it may seem it's very expensive to do so uh I could tell you running two rigs uh in the United States right now on a th000 meter holes is going to run you over a million us a month uh and that's not even getting hold that in one month so um in terms of relative cost they we're very competitive uh that's also always been the case you know when you look at where we're located and the fact that we don't have Camp costs we've got local Drillers etc etc uh so I think moving forward as we delineate Discovery at depth it's not not going to be cost prohibitive uh in particularly when you put it in costs relative to other jurisdictions even within Canada and um thank you and are you um still very much uh exploration focused I mean because uh Peter Jones is uh you know he's he's a mining engineer he was involved in HUD Bay uh I I noticed in in your uh resource press release that you put out in uh July of this year you mentioned the fact that uh rainbow is 250 M from power and a shaft and Road um you know is there part of you that we just saying Hang on we're not getting the value for the expiration Let's either shift strategy or do a twin strategy of getting into production quickly no we'll definitely get there and I think that one of the key things that the Market's looking at is is is it large enough I mean obviously Peter and the rest of the team thinks that we're certainly there and world the cost of something quite great there on the proberbly from the expiration standpoint but when you look at my development you need to look at my development of the property a longer term vision and I think when you put in place the fact that you have now descendant there where it's located you've got to keep that in mind I think the one of the key Treasures that we have at Pine Bay is we also have a a shallow Discovery at Rainbow that it's ramp accessible based upon how close is this to surface that's what you would kind of really assume within 100 Meers of surface uh and so that's something that you didn't have 177 7 was necessarily in development 777 starts at roughly 800 met vertical depth which is similar to where the initial intersection uh that we had in 2016 2017 uh over where The Descendant sits so I think as we move forward I think very quickly we can get uh to a position where potentially can double our resource base in the next call it 12 to 18 months and I think then you could do an in tandum approach so it kind of a target of um the threshold of 10 million tons is what you're looking at of with good economics I think that um you could be there right now but I think that ultimately when you look at longer term development you know we want to look to a scenario from an expiration standpoint or we're not just at 10 million tons we're looking at how do we get to 30 40 50 million tons of mentalization on the property and I know it's a bold statement but again we wouldn't have spent the past decade of our time and our lives expl a property that we didn't believe hosted that type of potential you know I think we're certainly on something um big with The Descendant Discovery that's kind of the belief of our team um again we've focused on this area we're not the first ones to believe that going back to you know over A Century of exploration there and um you know I think we need to focus to grow the company with a drill bit over the next 12 months and I think we're a very very strong position to then continue to grow the the the company through the development path in t the exporation their after I was was brought up on that expression that it's the seventh company that comes through that finds the deposit you know you turn over yeah yeah no it's said like when you it was actually one of the most valuable things that the resources going back and also you know putting together the report is going back and look at all the work that was done on the property and how long that work is done and actually uniquely enough um going back to the history of khid X our predecessor Kal andm actually s a shaft about 150 M away a give or take over at the baker patent deposit in 1929 as a second company to explore the area so um there's a lot to the name obviously I think you know in the future MERS are going to descend deep underground to mine that copper but we're also uh descendants from previous explorers of Kalen and mines and going back to 1911 everyone that kind of was Pioneers for exploration in the Flint flood area uh with this most recent discovery on the property that we're very excited about it's um it's always interesting when you go back through project history and you see why companies left and you can see the decision-making processes and it's even when you get the opportunity to speak to geologists who previously worked or people within the team there's always a kind of a backstory behind the formal report of what the psychology of the company was what the what the dynamic of the market was uh and it it's so instructive to get that um that that level of insight um well you yeah to to add on to that even to make the decision to drill The Descendant Discovery bow was really years in the making right when you go back and look at time what was a copper price environment when we were exploring at those depths in 2016 2017 it was $2 copper so when you're drilling 1,000 meter holes at a $2 copper price environment uh it's not as palatable as you know fasting fast forward in a $4 copper price environment with the also the knowledge that we've gained over the past SLE years to have the conviction and drill that kind of depth of a exploration hole and and to follow up on that you know had we not gone through experience of rainbow and Alchemist you could ask yourself would you have the conviction to return and drill those type of Dees to to make a discovery over on the cabin Horizon where descend it sets and and of course one of the reasons why uh companies stop drilling or stop exploring is because they run out of money um so where where are you and what happens now and and have you got the kind of the shareholder register that's willing to go again let's say for kind of uh uh 2024 listen you know every time we've done a capital raise it's been twofold I think you know the onus isn't always on existing shareholders though I think the support is certainly there it's been there in the past and then as we move forward I think that we certainly have a company that's well worth investing in that'll continue to attract the capital uh I think it's some you know when we've needed the money we've always uh receive the money we needed as organization um through thick and through thin uh through the the you the toughest times we've been able to attract that capital and raise it and I think nothing's going to change moving forward I think as we move forward to 2024 we're going to be the strongest who've ever been uh from a company perspective I think the catalysts are in place to really execute deliver and show that I think from a TRC a capital standpoint we're going to continue to attract the capital necessary from long-term supportive sholders just like we've already done in the past uh to really you know continue to grow the company as we move forward in 2024 Beyond uh Max thank you um so I mean you you said you're going to focus on exploration you're going to add tons you want to highlight the potential to get to uh 2030 maybe even kind of signpost a way to more more tons than that you're focused on uh descendant what what have we missed what what else are you going to be kind of looking to be talking about in your shareholder letter in in early January well I I think that again uh going into the new year with a new discovery is exciting um it was a great way to kind of call ulator exploration campaign here in 2023 um I think really we we got the feel uh from you know our excitement level that I think we're on to something special to get again uh you know understanding the path isn't always straight up it's got its ups and downs and we understand that we've navigated that through the ins and outs of all these markets uh and I also think that there can be deals to be done uh to continue to grow the company in different ways um irrespective of the markets and so we'll execute if we see it opportunity to do that um we inclin to do that but again I think growing the company through the drill bit while it is the most difficult part of the business um once you're kind of really getting your teeth into a discovery then it really becomes stepping out and uh following up with the work so again I driving the company's growth through the drill bit is is really the path for for the company once um yeah once you managed to unlock the code and then it becomes a little bit more of a process um yeah yeah no you're right um and The crucial bit is actually kind of getting the ability to you can kind of know where to drill um talking of which you know what happens over Christmas are you taking some you going to take some time off between Christmas and New Year or um uh do the Drillers uh keep going what what what's what's the kind of the activity level over the next few weeks just out of curiosity well it's different than last year last year we actually had a drill running over Christmas and uh I was actually at sight so it was kind of a cool experience this year being a little bit different we've got the necessary drilling done uh we just WRA that up and people are still at sight you know kind of cleaning things up for the holidays and then really Penny assia results and you go a waiting what's to come uh over the next little while so uh kind of a quiet period for I think really exciting 2024 that's ahead of us and get back to Drilling in in in in when the drill when the drill gets turn I don't know if you know that Phantom when you think you're missing your fou you know in your pocket like R your F yeah I get that with a drilling Conant like where's is the drill are we drilling the minute the drill stops so um we'll definitely get back to work as soon as possible um but doesn't mean everything's completely sto with uh the work in the field as well as you know behind the scenes uh plenty Al the results yeah good well Max um thank you very much congratulations on a successful year uh on the technical side of things and kind of with the discoveries I mean the share price has been beaten up but I guess that's um um opportunity OPP in in of itself yes that is true you know I think of times when you look down in the B the past like why am I going through this right now um and anytime we you're down it set us up to something even greater um if you know we were knocked down so deep back you know with the zinc collapse uh really in 2018 you question hey would you be here right now with the discoveries at Pine Bay because that kind of led to us making our comeback at Pine Bay uh so again I think it's a great opportunity in the market tax L selling occurs uh but again we've got the staying power to weather a storm and a very bright future ahead great on that note thanks very much and um have a good Christmas Hardy thanks tier

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Id: PH7dLoMqPIk

Length: 28min 17sec (1697 seconds)

Published: Fri Dec 22 2023