Projects

Overview

Desert Fox Van Dyke Co., a wholly owned subsidiary of Copper Fox Metals Inc., owns a 100% working interest in the Van Dyke project located in the Globe-Miami Mining District in Arizona. The Van Dyke In-Situ Lease (‘ISL’) project consists of 531.5 hectares (1,312.8 acres) of mineral rights and 5.75 hectares (14.02 acres) of surface rights and is subject to a 2.5% gross royalty on revenue. Arizona is a favorable mining jurisdiction with respect to taxation, regulation, infrastructure and labour.

The Globe-Miami Mining District is located at the eastern end of the Casa Grande to Globe-Miami structural trend that hosts the Casa Grande, Florence, Ray, Superior/Resolution and Globe-Miami copper mines.

The Van Dyke copper deposit is located within the Inspiration-Miami trend of deposits that includes four principle orebodies, from west to east they are Live Oak, Thornton, Miami Caved and Miami East.  The Van Dyke property was first explored and developed in the early 1900s when a shaft was sunk to a depth of 1,692 feet.  The underground mining operations are reported to have produced 11.8 million pounds of copper between 1929 and 1945 from copper oxide mineralization with a reported grade of 5.0% copper.

Historical Results - Van Dyke Project:
Between 1968 and 1982 Occidental Minerals obtained the permits to conduct two ISL tests. The second, more extensive test, consisted of five injection/recovery wells and was conducted for a period of approximately two years, the conclusions of which are summarized below:

  • Maximum injection rates were 450 gallon per minute (“gpm”) (at 95% of design capacity) and 275 gpm on a continuous basis,
  • Total copper recovery should be 58.8% extraction from total available copper after 36 months leaching per gallery, clean up leaching should bring the total to 75% extraction,
  • Demonstrated hydraulic connection for a distance of up to 249 feet (76m),
  • Porosity and permeability of the formation is suitable for full scale production, and
  • Over 100,000 pounds of copper was produced during the test in pregnant solutions.

The information on the historical leaching testwork was taken from a report prepared for Occidental titled “Summary of In-Situ Leach Testing on the Van Dyke Copper Deposit Through 1981’ by C.R. Caviness dated June 1986.

Between 1988 and 1989 Kocide Chemicals permitted the Van Dyke project and is reported to have recovered 4 million pounds of copper utilizing an ISL mining method.

2014 Exploration:
In 2014, Copper Fox completed verification diamond drilling, re-assayed 560 of the original pulps from drilling completed by Occidental and conducted in-situ pressure leach tests on whole drill core samples. The results of these activities were the basis to advance the project to a Preliminary Economic Assessment.

2015 Preliminary Economic Assessment (“PEA”):
In November 2015, Copper Fox announced the results of a NI 43-101 Technical Report entitled “Preliminary Economic Assessment Technical Report for the Van Dyke Copper Project” dated November 18, 2015, as amended May 19, 2017 prepared under the direction of Moose Mountain Technical Services, Mr. Jim Gray, P.Eng., et al as Qualified Persons.  The PEA suggests that Van Dyke is a technically sound, ISL copper project with low cash costs and strong cash flows.

The results of the PEA are preliminary in nature as they include an inferred mineral resource which is considered too speculative geologically to have the economic considerations applied that would enable them to be categorized as mineral reserves. There is no certainty that the PEA forecasts will be realized or that any of the resources will ever be upgraded to reserves. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

The updated Inferred Resource used in the PEA is stated at a 0.05% total copper (“TCu”) cut-off and is appropriate for the extraction of copper by in-situ leaching.

Inferred Mineral Resource Estimate Van Dyke Project (Sue Bird, P.Eng.)

Zone Cut-off - TCu(%) tonnes TCu (%) ASCu (%) ASCu/TCu Total Cu (Mlb) Oxide Cu (Mlb)
Oxide 0.05   113,143,000 0.434 0.284 0.676 1,083 704
Mixed 0.05     69,918,000 0.167 0.060 0.403 245 93
Total 0.05   183,061,000 0.332 0.198 0.598 1,328 797

Notes: All numbers are rounded following Best Practice Principles. The total copper and oxide copper expressed in millions of pounds (‘Mlb’). The terms Oxide and ASCu represent acid soluble copper. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

The resource estimate suggests that the copper mineralization on the Van Dyke property is open to the west and southwest.

Base Case Results of the Preliminary Economic Assessment on the Van Dyke Project are shown below:

Van Dyke - Economic Summary Unit Base Case
Life of Mine (LOM) years 11
Copper Cathode Sold Million lbs 456.9
Copper Price $US/lb 3.00
Gross Revenue $ 1,370,000,000
Royalties $ 31,500,000
Operating Costs (includes LOM sustaining costs) $ 619,800,000
LOM Direct Operating Cost ($/pound recovered copper) $/lb copper 0.60
All In Sustaining Cost ($/pound recovered copper) $/lb copper 1.44
Initial Capital Costs (includes 30% Contingency) $ 204,400,000
Taxes $ 110,900,000
NPV & IRR (Base Case)    
Discount Rate % 8%
Pre-Tax Net Free Cash Flow $ 453,100,000
Pre-Tax NPV $ 213,100,000
Pre-Tax IRR % 35.5%
Payback Years 2.3
Post-Tax Net Free Cash Flow $ 342,200,000
Post-Tax NPV $ 149,500,000
Post-Tax IRR % 27.9%
Payback years 2.9


Project Enhancements:
The 2015 PEA identified several aspects of the project that could have a positive impact on project economics and recommended completion of a pre-feasibility study at an estimated cost US$16.6 million. The main components of the pre-feasibility study are:

  • A 10,000m diamond drilling program to expand the size of the resource and upgrade the existing Inferred Resource has the potential of increasing mine life;
  • A five well ISL test program designed to further investigate overall metal recoveries, refine well field design, and determine the extent of rock stimulation required, if any, and
  • Opportunities to lower capital, sustaining and operating costs by reduction in the size of the underground development and further defining operating procedures.

In 2019, Copper Fox commenced a program to re-analyze all historical pulp samples and selected core intervals from historical drill holes for Total Copper and Acid Soluble and Cyanide Soluble Copper analysis.

The initial 2019 results show 29% higher soluble copper concentration and thicker mineralized intervals compared to the projects original database.  The 2019 program is designed to determine the full extent of the soluble copper envelope for the Van Dyke deposit, increase certaintly and confidence in the analyses, delineate the oxide and supergene boundary and re-logging of selected drill holes for lithological and structural information to update the geological model for the Van Dyke project.

The sampling and re-logging of selected historical drill holes porgram has been completed.  Analytical results are pending.  On receipt of the results, Copper Fox will assess the possibility of completing an updated resource estimate for the project.