Northisle Copper and Gold shares rise on resource update ahead of PEA

Northisle Copper and Gold (TSXV: NCX) shares rose after the company posted an updated resource estimate for its project near Port Hardy, B.C., to support a new preliminary economic assessment (PEA) it expects to publish early next year.

The North Island project resource now totals 906 million indicated tonnes grading 0.16% copper, 0.24 gram gold per tonne and 75 parts per million (ppm) molybdenum, for total contained metal of 6.3 billion lb. copper equivalent, plus an additional 214 million inferred tonnes grading 0.12% copper, 0.22 gram gold and 52 ppm molybdenum for 1.3 billion lb. copper equivalent.

“The project now boasts over 3 billion lb. of copper and nearly 7 million oz. of gold in indicated resources, making it one of the largest copper and gold porphyries in Canada not currently owned by a major,” commented Northisle’s CEO Sam Lee in a news release.

The updated resource, which integrates the Hushamu, Red Dog and Northwest Expo deposits, represents a culmination of the company’s exploration program over the past four years. The results, according to Lee, will form the basis of a new PEA that contemplates lower initial capital intensity leading to a potentially larger project and longer life of mine.

The previous PEA in 2021 only included the Red Dog and Hushamu deposits, and outlined a 22-year mine life with average annual production of 177 million lb. of copper equivalent over the first six years, including 112 million lb. of copper, 112,000 oz. of gold and 2.7 million lb. of molybdenum.

The PEA also presented the following project economics: $1.1 billion in after-tax net present value (at 8% discount), 19% after-tax internal rate of return, and a payback period of 3.9 years. The project capex is estimated at $1.4 billion using existing infrastructure from historical mining, as North Island is situated adjacent and northwest of BHP Billiton’s (NYSE: BHP; LSE: BHP; ASX: BHP) now closed Island copper mine.

Shares of Northisle Copper and Gold surged following the resource update, up 14.6% to 47¢ apiece in afternoon trading in Toronto. The company’s market capitalization is estimated at $106.2 million.