Exploration and development company Osisko Metals is looking at the former Gaspé Copper, which in its past life was one of the largest copper operations in eastern Quebec.
Osisko has the exclusive option to acquire 100% of the Gaspé mine from major commodities company Glencore for an upfront payment of $25 million and a payment of $20 million at the start of commercial production.
The company must also incur drilling costs of C$5 million by June 30, 2022 to test oxidation levels in the mineralization that surrounds the historic Mount Copper open pit deposit.
Osisko notes that there is significant exploration and resource development potential at Gaspé Copper, which includes the former Mount Copper open pit mine, the higher-grade Needle Mountain and E-Zone underground mines, as well as than the undeveloped Porphyry Mountain deposit.
A drilling program will begin next month with the aim of validating an internal resource model and the oxidation levels of mineralization at the Mount Copper deposit, which is a critical phase of due diligence on the project that will lead to a decision on the opportunity to exercise the option before June 30.
“Gaspé Copper has been a major copper producer in Eastern Canada for over 40 years, and we believe in the potential for upgrading this asset through drilling and re-evaluation of the remaining resources. If our internal model is validated, we expect to close the transaction and publish an initial inferred mineral resource estimate for the Mount Copper deposit this year,” said Osisko’s President and CEO. Robert Merchandise.
The successful closing of this transaction will give Osisko shareholders significant exposure to copper and make Glencore a major shareholder in the company.
“In addition to the continued development of our Pine Point zinc/lead project, we are confident that this combination of projects will solidify Osisko Metals’ position as one of Canada’s leading base metals developers,” he said. .
From the first discoveries in 1921, Gaspé Copper (formerly a subsidiary of Noranda) mined the porphyry copper/skarn complex and produced copper concentrate continuously from 1955 until the mine closed in 1999.
Production began with the open pit at Needle Mountain and later expanded to open pit mining at Mount Copper which was supplemented with feed from high-grade underground skarn mineralization ( Zone B and C deposits), as well as massive subsurface skarn and manto sulphide deposits. E area.
Over the life of mine, a total of 150 million tonnes grading an average of 0.87% copper with minor gold and silver credits have been mined.