Osisko hits 4.7% copper beneath Gaspé workings

New drilling by Osisko Metals (TSX: OM; US-OTC: OMZNF) at its Gaspé Copper project in eastern Quebec has extended the past-producing mine’s footprint, demonstrating the potential for higher-grade mineralization near old underground workings.

Standout hole 30-1228 cut about 257 metres grading 0.85% copper and 5.13 grams silver per tonne from 33 metres depth, including a higher-grade 28.5 metres at 4.74% copper and 27.4 grams silver from about 200 metres downhole, Osisko said Thursday. Mineralization in the hole extended 50 metres below the project’s historical C zone to a vertical depth of 275 metres.

Osisko’s project on the Gaspé Peninsula that juts into the Gulf of St. Lawrence aims to revive one of Canada’s historic mines into a modern large-scale operation in time for surging new-energy demand for copper. It would support throughput of up to 160,000 tonnes per day, placing it among Canada’s largest operations. 

“The result indicates potential for higher-grade mineralization within residual pillars, between the historical zones and at depth,” Scotia Capital mining analyst Eric Winmill said Thursday in a note. New infill results support the future conversion of inferred resources, he added.

The latest results, which comprise 28 mineralized intercepts from 12 holes, continue a run of strong drilling from Gaspé this year. In June, Osisko reported 80 metres grading 1.93% copper from 196 metres depth, including a 30-metre section at 3.49% copper, from the Needle Mountain area.

Faster pace

Osisko is using the infill drilling to upgrade inferred resources to the measured and indicated categories, while expansion holes are testing for mineralization outside the current resource model and within areas currently classified as waste inside the conceptual pit.

“The results continue to demonstrate the potential for resource growth and higher-grade mineralization beyond the current Gaspé resource,” Canaccord Genuity said in a note. “We view the results as supportive of further resource growth while increasing confidence in the continuity and grade of the southern Gaspé system.”

With new assay results now coming in at a faster pace, Osisko expects to provide continuous drilling updates throughout the fall, CEO Robert Wares said Thursday.

Other highlights released Thursday include hole 30-1235, which cut about 258 metres grading 0.39% copper and 3.6 grams silver from 47 metres depth, and hole 30-1225, which cut about 6 metres grading 1.19% copper and 6.1 grams silver from 260 metres depth.

Located about 825 km northeast of Montreal, Gaspé was once owned by Noranda.

Osisko acquired all of the property from Glencore (LSE: GLEN) in July 2023 and has since focused on rebuilding the mineral resource through drilling. It’s targeting permits and construction by the early 2030s, with initial capital spending estimated at about $1.8 billion (US$1.4 billion).

Largest resource

According to the company, Gaspé hosts the largest undeveloped copper resource in eastern North America.

Osisko in April released an updated resource that more than doubled copper metal content. Gaspé is now estimated to hold 1.83 billion measured and indicated tonnes grading 0.27% copper, 0.017% molybdenum and 1.57 grams silver for 10.77 billion lb. copper, 673.2 million lb. molybdenum and 92.8 million oz. silver of contained metal.

Inferred resources were pegged at 238.8 million tonnes grading 0.41% copper, 0.016% molybdenum and 1.88 grams silver for contained metal of 2.16 million lb. copper, 82.9 million lb. molybdenum and 14.5 million oz. silver.

Mineralization at Gaspé is classified as a porphyry copper-skarn system. Copper occurs primarily as disseminated and stockwork chalcopyrite accompanied by pyrite or pyrrhotite with minor bornite and molybdenite, Osisko says.

Osisko shares dropped 4.2% to $1.61 in Toronto trading Thursday morning as surging oil prices and higher bond yields stoked inflation and interest-rate concerns. The company has a market capitalization of about $1.5 billion. The stock has traded between 39¢ and $1.99 in the past year.