Transcription of Finance News Network Interview with Corazon Mining Limited (ASX:CZN) Managing Director, Brett Smith.
Anastasia Mangafas: Hello, I’m Anastasia Mangafas for the Finance News Network and joining me today from nickel explorer, Corazon Mining Limited (ASX:CZN)is Managing Director, Brett Smith. Brett welcome back to FNN.
Brett Smith: Thanks Anastasia.
Anastasia Mangafas: First up and to recap for viewers new to Corazon Mining, when did you list and where are your projects located?
Brett Smith: The Company listed in 2005, then it was called Graynic Metals (ASX:GYN) focused on precious and base metals in Western Australia. In 2010 they acquired an option over a new project in Canada and made a new focus, and the Company changed its name to Corazon Mining Limited. This project is a nickel/copper/cobalt/sulphide project in the province of Manitoba.
Anastasia Mangafas: To your main exploration focus, the Lynn Lake nickel sulphide project in Canada: What’s Corazon’s interest and at what stage is the project?
Brett Smith: It’s an advanced exploration project; it’s in an old mining centre that’s been closed down for several years. We had the right to earn 100 per cent of the project by spending $3 million on exploration, up until the 20thof October this year and then paying the vendor $2 million. It’s been a major focus of ours since acquisition in 2010 and we’ve already met the expenditure commitments, with respect to exploration.
Anastasia Mangafas: So what have your latest drilling results revealed?
Brett Smith: Exploration strategy has been to focus our attention to the depth extents of the mineralisation below the old EL mine, which was the highest grade nickel/sulphide deposit in the district. May last year we made a discovery 700 metres below surface, underneath the old mine of a high grade nickel/copper/cobalt breccia and since then, we’ve been targeting this zone and trying to determine the extents of the mineralisation.
We haven’t completed this work, we’re still putting holes into this and we’re still finding mineralisation. The deposit is open to the south-east, to the west but predominantly we’re looking at the blue sky at depth below this zone. We’ve tested it between say 700 and 820 metres below surface, we like what we see but work is continuing. In geometry this deposit is quite simple but in detail, the high grade nature of the mineralisation is more complex. We’re continuing to put holes into it, the more holes we put into it, the better it looks.
Anastasia Mangafas: Thanks Brett. What’s your current exploration target and when can investors expect an update on the resource?
Brett Smith: We’re still very much in the exploration phase; it’s an advanced exploration project. So a lot of the drilling that we’ve been doing could quite easily transform into a resource statement and upgrade of our existing resource. But this would significantly understate the potential of the project. Our current exploration target is for between 52,000 tonnes and 139,000 tonnes of nickel metal, with significant copper and cobalt credits.
It will take a bit more drilling to transform this into a resource category. In saying that, between 30,000 and 35,000 tonnes of this nickel exploration target exists in the upper and middle zones of the EL deposit. So predominantly between zero and 400 metres below surface and this is supported by an enormous amount of historical drilling, underground mining and underground exploration. So we know that that worked, getting that into resource status would not be a difficult task.
Anastasia Mangafas: I see you’ve commenced preliminary mining studies, can you tell us a little bit about that?
Brett Smith: Yes, the Lynn Lake district is a bit different to what Australian’s are used to and we’re ASX listed. The Lynn Lake deposit compared to Australian nickel deposits are low grade deposits. They’re mined at significant depth of about 1,100 metres below surface. So we wanted to as part of testing our exploration strategy, but also identify to our shareholders and the market, that these things are mineable at today’s cost and today’s metal prices. So we’ve been doing high level mining studies. These results are fairly positive, in fact extremely positive. They identify that our exploration strategy is right and these things hold potentially enormous value.
Anastasia Mangafas: To your financials: What’s your current cash position?
Brett Smith: Last quarter identified $2.2 million, just under $2.2 million available for us for exploration. With the current exploration program in process now, we should end this month - we expect at the end of May to have about $1.5 million available to us for exploration. Outside of drilling our cash burn rate is minimal and at this stage, we’re looking back at our exploration results and finalising what we’ve done for the last six months. And we haven’t completed the exploration programs going forward.
Anastasia Mangafas: So looking ahead, what’s your outlook for nickel prices?
Brett Smith: Yeah it’s a tough one. I just read what other people say, so I can just report that. Nickel is possibly the worst performing metal on the LME (London Metal Exchange). Last year, over the last 12 months, it’s lost more than 30 per cent of the price. In April this year it lost four per cent. So it’s not good but the way we look at it, it’s coming from a low basis and looking forward, it should perform quite well. In the later half of this year, I think base metals – people believe that the demand for base metals, the serious demand, the significant demand, will increase. So we’re pretty positive about the future.
Anastasia Mangafas: Finally Brett, what milestones will Corazon Mining be aiming for this year?
Brett Smith: The Lynn Lake project for us is a very good asset with we believe, enormous upside. At this stage, we’re pretty much focused on defining the depth extent of this mineralisation – the size and tenure of mineralisation. We are looking back at what we’ve done to date to plan the programs going forward and will continue to update the market on a regular basis, on these exploration activities.
Anastasia Mangafas: Brett Smith, thanks for the update.
Brett Smith: Thanks Anastasia.
Ends
