Copper Quest Exploration (CSE: CQX) has now acquired the past producing Alpine Gold Property in British Columbia, adding another high grade gold asset to their portfolio and transforming the Company into a dual copper-gold player. At this point in time gold prices continue to be elevated, so the acquisition of the Alpine Gold Property will bring historical resources, current underground development and near term optionality to the table.
Key Points
- Historical gold resources of 142,000 oz’s at high grades
- Existing underground mine and underground access available
- Optionality for near term cash flows via surface stockpiles
- Significant district scale exploration opportunity with several unexplored veins
- Technical experience added to the team upon closing
The Alpine Gold Property
Alpine Gold Property is located in the West Kootenay region of British Columbia and is approximately 20 kilometers north east of Nelson. As well, it has a previous underground gold mine that was previously mined and has infrastructure that exists.
It has a 2018 NI 43-101 historical inferred resource of approximately 268,000 tonnes grading 16.52 g/t gold and is equivalent to approximately 142,000 ounces of gold. Only approximately 300 meters of what is believed to be a 2 kilometer long vein system has been explored to date; therefore, there is significant expansion potential for exploration both along strike and at depth.
Near Term Optionality
In addition to the exploration upside at Alpine, it also has other options for generating value in the near term:
- Approximately 24,000 tonnes of run of mine mineralized material on surface
- Approximately 1650 meters of clean dry underground workings are currently developed
- Lower capital costs relative to green field projects
Alpine has the ability to provide the company with multiple paths to value generation beyond early stage exploration which includes production or bulk sampling opportunities (subject to technical and economic evaluation).
District Scale Exploration Opportunity
Alpine covers approximately 4611 hectares and is road accessible on a year round basis. The Alpine property contains at least four additional vein systems in addition to the Alpine vein, which include:
- Black Prince
- Cold Blow
- Gold Crown
- King Solomon (past producing)
All have shown historic high grade gold and are still relatively unexplored; therefore, Copper Quest (CSE: CQX) has multiple shots on goal in a single large block of land.
Enhanced Technical Capability
Upon acquiring the Alpine property, Copper Quest (CSE: CQX) has enhanced the technical capability of the company with the addition of senior industry experience to its board and advisory teams:
- Allan Matovich has joined the Board of Directors
- Ted Muraro and John Mirko have been appointed as Technical Advisors
Together, the group has in excess of 150 years of combined mining and exploration experience, and directly involved in the discovery, development and production of mines throughout Canada and Internationally. The addition of this group of experienced professionals adds significant credibility to the company and reduces the risk associated with advancing the Alpine project.
Terms of Transaction
The purchase of the Alpine property was done by issuing approximately 14.2 million shares at a deemed price of $0.135 per share, for a total of approximately $1.91 million. The share issuances are structured to take place over a 24 month period, reducing pressure on the companies balance sheet in the short term and aligning long term incentive plans.
Other key terms of the agreement include:
- Repayment of $225,000 for prior exploration expenditures
- 2% net smelter returns royalty with the right to repurchase 50% of the royalty for $1 million
This structure provides balance sheet flexibility to Copper Quest (CSE: CQX) and secures a high grade gold asset.
Portfolio Impact
The acquisition of the Alpine gold property changes Copper Quest (CSE: CQX) from a primarily copper focused explorer to a dual metal explorer with exposure to both gold and critical metals. The acquisition of the Alpine gold property adds a new dimension to the companies overall North American portfolio and creates multiple potential sources of value, including successful exploration, resource growth and near term monetization opportunities.
Summary
Copper Quest (CSE: CQX) has purchased a high grade, previously producing gold mine with expansion and near term optionality, while being fiscally responsible and enhancing its technical team. In a strong gold market, Alpine gives the company multiple avenues for creating value beyond simple exploration.
Marc has been involved in the Stock Market Media Industry for the last +5 years. After obtaining a college degree in engineering in France, he moved to Canada, where he created Money,eh?, a personal finance website.
