I’m getting lot of comments from individuals asking do you think the grade from hole XYZ is 1% or greater than 0.60%. My thoughts are:
- The grade doesn’t matter at this point. Oroco has a huge deposit. No one is giving any credit for it since the drilling (until the recent few holes) is 20+ years old. Oroco just needs to drill and prove the resource there. If all the company did was prove the historical grade shell and showed 0.40% grade we would have a resource someone will buy for much more than the current market cap
- High grade is huge bonus. Getting a high grade zone is huge bonus for Oroco and especially for the acquirer. The calculation drastically changes when you have a material high grade area. Again, this is nice if we find it. But even if you don’t, you are not going to lose anything at current valuation of Oroco
- There is lot of expansion potential with the land area that Oroco owns. Brasilles is a huge resource expansion, again grade doesn’t matter; just showing X billion tons at 0.40% grade would be huge. South Zone has potential to be big and likely better grade than historical (if you include the other minerals). Then there is potential expansion from drilling deeper in the North Zone.
- The location of the North Zone, South Zone, and Brasilles means they can share the mill. So you don’t need a high grade zone to make the economics work out.
So don’t get caught up on wanting to see a high grade in the assay results. All management needs to do is keep drilling and proving the resource. So far the management team has a 100% success on the drilling, that is huge. I think from the pictures of the ore body from current drilling, where assay results are not announced, it shows that the 100% result will keep going.
As an investor all you need is management to drill baby drill. More drilling will prove out more of the resource. A resource at 0.40% grade will get majors coming. This is a resource that is going to take multi decades to drill. The 0.40% grade is good enough given the size and access to infrastructure. At current valuation of Oroco you will do really well if all you had was a 0.40% grade copper resource that is going to last you for multi-decades.