American West Metals (reserve code ASX: AW1) is a new company that will list on the ASX later this year. Please start by giving us a brief introduction to the company’s background, including the management team you have assembled.
American West Metals was created with a focus on growth through the discovery and development of major base metal deposits in Tier 1 jurisdictions of North America. We are a progressive mining company focused on developing mines that have a low-footprint and support the global energy transformation.
Our portfolio of copper and zinc projects include significant existing resource inventories and high-grade mineralization that can generate robust mining proposals. Core to our approach is our commitment to the ethical extraction and processing of minerals, and making a meaningful contribution to the communities where our projects are located.
The Board consists of John Prineas (non-exec chairman), Michael Anderson (non-exec director) and myself. John is also the executive chairman of successful, Western Australian-based nickel-copper explorer, St George Mining Ltd (ASX: SGQ). Mike joined us shortly after the formation of American West Metals and is the current managing director of African gold and lithium developer, Firefinch Ltd (ASX: FFX).
Given we are an Australian company, we thought it was important to form a North American-based technical advisory team to assist with in-country advice and strategy. This team brings a great depth of experience and technical expertise, and has a strong network with local government and professional organizations.
In terms of boots on the ground, we have recently appointed a locally based vice president of operations, Rocky Pray. Rocky has extensive experience with large development programmes and mine expansions in the region, and will oversee and drive the Scoping Study work at the West Desert Deposit.
You are exploring for metals critical to decarbonization, including copper, zinc, and indium. Why did you choose sites in North America rather than Australia?
We chose North America for a number of reasons, but the three main attractions for us are the world-class address, relatively low exploration maturity, and under-valued opportunities.
Firstly, we strongly believe that in order to discover and develop high-quality deposits, then its best to look in areas that have them, and our projects are located close to world-class deposits, with long mining histories. There are a number of assets globally that are struggling due to their location and lack of infrastructure. So, to be located within these Tier 1 jurisdictions was an important consideration for us and significantly de-risks the investment proposition.
Secondly, although the areas in which we are operating are well-known mining districts, and therefore seem to be fairly mature in terms of exploration coverage, very little modern exploration has actually been completed in areas with any significant cover and this is where the opportunities remain. Most historical mines, particularly in the West Desert area, were discovered in areas with outcrop. We are fairly used to exploring through cover here in Australia, and the application of modern geophysics and further drilling has the potential to open up these areas under cover for further discovery.
And lastly, in terms of opportunity, there are a lot of undervalued assets in North America. The mining sectors, particularly the Toronto Stock Exchange (TSX), haven’t been as strong as that in Australia over the last few years, and therefore it has been harder for companies to raise money to continue to progress their projects. This presents opportunities in the M&A space, and the timing turned out just right for us to put all the assets together with the uncertainty in the market around the COVID pandemic at the time.
In terms of opportunity, there are a lot of undervalued assets in North America
Currently, you have three projects: West Desert in Utah, U.S., the Storm and Seal projects in Canada, and Copper Warrior – also in Utah. Please tell us a bit about each one.
West Desert is located in west-central Utah, approximately 160km southwest of Salt Lake City, and will be 100% owned by American West Metals upon listing.
The deposit is a large, zinc-copper-indium Skarn and Carbonate Replacement Deposit (CRD), which is one element in a regional scale mineral system. It contains a historical and foreign resource (Ni 43-101 compliant) of over 59Mt @ 5.78% ZnEq, which contains a coherent higher-grade core of approximately 16.5Mt @ 6.3% Zn, 0.3% Cu and 33g/t In (1.03Mt Zn, 45Kt Cu and 545t In). The deposit is located within the heart of the Sevier Orogenic Belt, which hosts the giant Bingham Canyon copper deposit and world class Tintic Mining District.
The growth potential of the deposit is outstanding, as it is open in all directions and drilling during 2018 intersected thick intervals of high-grade zinc mineralization outside of the resource shell. Exploration drilling in the near mine areas has intersected further skarn and CRD mineralization, and highlights further discovery potential for several different deposits of base and precious metals within the project area.
The Storm and Seal Projects are located on Somerset Island in Nunavut, northern Canada. The area is within the Polaris mineral district and 122km south of the regional community and logistics hub of Resolute Bay. Two distinct styles of mineralization have been discovered by historical exploration.
At Storm, structurally controlled, high-grade copper has been intersected from surface with outstanding historical intercepts including: 110m @ 2.45% Cu from surface and 56.3m @ 3.07% Cu from 12.2m. The mineralization is chalcocite dominant and we believe it will be amenable to traditional ore sorting and beneficiation techniques, and therefore have the ability to produce direct shipping ores (DSO).
Seal is a high-grade zinc and silver deposit with a a historical and foreign resource (Ni 43-101 compliant) of 1Mt @ 10.24% Zn and 46.35g/t Ag. The mineralization at Seal is open at depth and along strike and has been confirmed to be of the same age and event that formed the world class Polaris Zinc-Lead Deposit. The Seal stratigraphic horizon is largely unexplored and contains numerous zinc soil anomalies along its 75km strike.
The Copper Warrior Project is targeting sediment hosted copper and is situated just 15km north-west of Lisbon Valley, Utah’s second largest copper mine. The two major mineralized units at Lisbon Valley are also present within our project tenure, defined by widespread occurrences of copper mineralization at surface, strongly supporting the potential for economic copper mineralization.
Your flagship West Desert Project in Utah is a large zinc-polymetallic deposit. Following your IPO, what are your plans for drilling and exploration at the property?
The capital we raised as part of the initial seed has given us the ability to start infrastructure upgrades, initiate key study work, and complete a geophysical survey at West Desert prior to the IPO. The interpretation of the geophysical data is almost complete and will, combined with the historical work, help further define the exploration programme beyond the currently planned resource development and near-mine follow-up work.
The immediate work programme post IPO at West Desert, starting in January 2022, will be diamond drilling to support the delivery of a JORC-compliant resource. This programme will have a particular focus on confirming the continuity of the high-grade zinc and copper zones, and testing the amenability of the oxide portion of the orebody to traditional processing methods.
In parallel with this work will we continue the de-risking activities on the high-grade development scenario, which includes hydrological, environmental, metallurgical, and detailed mining studies.
After the IPO, aside from drilling at West Desert what are your future plans for Copper Warrior, and Storm and Seal?
As part of the pre-IPO activities, the opportunity was taken during this Arctic field season to complete a high-powered, low-noise surface Electro-Magnetic (EM) survey over Storm and Seal. This survey was aimed at giving higher resolution data over the current copper and zinc prospects, and searching for further high-grade mineralization around Storm.
The next round of exploration work at will involve further drilling to expand and deliver a JORC-compliant resource for Seal, and begin initial resource definition work at a number of the high-grade copper prospects at Storm. Any new high priority targets in the Storm area will also be tested with drilling.
Copper Warrior is an earlier stage project and our initial work there will be to confirm the lateral extent and thickness of the two mineralized host units within our claim block. We will use geophysics and then drilling to define the volume of copper sulphide mineralization.
In terms of your projects, they are all located in Tier 1 mining jurisdictions. What are some of the strategic and logistical advantages of having operations in Canada and the U.S.?
Having worked around the globe and in some pretty difficult regions, we chose North America as it has the services, infrastructure and mindset to generate some incredible outcomes. Indium, and more recently zinc, have been added to the U.S. critical minerals list, which makes them strategically important in a country that imports a large percentage of these commodities and is expected to face deficits in the coming years.
In terms of operating costs, the U.S. is generally cheaper than Australia, with Canada almost on par. And whilst both the U.S. and Canada are also experiencing a resurgent mining industry, it hasn’t yet reached the pace of Western Australia and therefore services like drilling and laboratories currently have better availability.
What are your plans for American West Metals over the next few years?
Growth and sustainability. We want to build a strong reputation around our core values of adding shareholder value through the discovery and development of deposits with low impact to the environment, communities, and regions in which we operate. With West Desert, Storm and Seal, we have a line of sight to robust mining proposals and this will underpin our growth over the next few years.
