Alert on Fitzroy Minerals FTZ, FTZFF
I have been following Fitzroy Minerals for a while and they just made a game changing acquisition and trading resumed Thursday morning. I expect this stock will do very well. I have known the Executive Chairman, Campbell Smyth for over 20 years. He is very successful, knows how to execute, finance and promote a junior mining company. I also know the qualifying Geo, Dr. Scott Jobin-Bevans a bit longer. Management teams don't come much better, some more below.
Fitzroy Minerals - - TSXV:FTZ, OTC:FTZFF - - Recent Price - $0.20
Shares Outstanding 217.4 million Management/Insiders own approx. 57%
Fitzroy is focused on one of the most well known regions and #1 for copper mines, Chile. They also have a very good gold project close to the Chile border in Argentina.
Fitzroy announced the acquisition Ptolemy Mining Ltd. On October 30th, a UK private company. Ptolemy's chief asset is the Buen Retiro project in Chile.
The project is close to the Candelaria deposit in the Punta del Cobre iron-oxide-copper-gold (IOCG) district of Copiapo, Chile. High-grade copper oxide ore was mined from 2005 to 2009 at Manto Negro (part of Buen Retiro) and trucked 60 kilometres to a processing plant in Copiapo. The Manto Negro open pit is just five km from the Pan American Highway and high-voltage transmission lines. The Buen Retiro project has a wealth of information, including assay data from 28,290 metres of historical drilling records; core and data from 4,895 m of recent diamond drilling; and raw and interpreted data from extensive geophysical surveys.
The acquisition of Ptolemy also brings a very significant addition to management and expertise.
Matt Gordon is the principal shareholder and founder of Ptolemy. He has 30 plus years in global banking and marketing. Most important he is owner of CRUX Investor and Family Office investor.
CRUX is the world's largest natural resource platform with an audience of over 250,000 retail investors, Family Offices and HNWIs.
Gilberto Schubert who was an advisor to Fitzroy with 30 years experience. From 1992 to 2013 he worked for Vale, culminating in eight years as Country Manager, Chile. Gilberto holds a B.Sc and an M.Sc in Geology from the Universidade Federal do Rio de Janeiro; an MBA from Fundação Dom Cabral, Belo Horizonte; a Diploma in Mineral Economics from Universidad de Chile, Santiago; and an MSc in Mining Economics from Curtin University of Technology, Perth.
Merlin-Marr Johnson is the CEO of Fitzroy and also a founder of Ptolemy has 30 years experience, including geologist for Rio Tinto and an analysts for HSBC. He holds an honors degree in geology from Manchester University and a Master’s Degree in Mineral Deposit Evaluation from the Royal School of Mines, Imperial College.
and Irene del Real Contreras, an expert in IOCGs of Punta del Vobre, Chile. She is a former consultant to Lundin Mining at Candelaria, has a Ph.D from Cornel University, B.Sc Geology University of Chile and M.Sc from University of B.C., Canada.
Fitzroy will acquire Ptolemy Mining for 88 million shares that will be in escrow along with work commitments on Buen Retiro of US$7 million within 4 years. To date $1.54 million of this has been spent. In year 5 the option can be concluded for 100% interest with an additional $4 million payment. The property is subject to a 2% NSR which 1.0% can be bought for $4 million.
The project also includes the Sierra Fritis option where US$2.6 million must be spent within 4 years with $500,000 in year one. To date $460,000 has already been spent on this option. In year 5 a US$50,000 payment is required to conclude the option agreement for 100% interest with a 2% NSR.
Buen Retiro is potentially a world class copper deposit. It has been de-risked with historical drilling and recent exploration and drilling as well as past production. The oxide material mined at the property is estimated at 1.3 million tonnes at 1.2% copper. Of note, the vendors of the property are the Vacchiola family that own a private Chilean company that provides engineering, construction, production and equipment leasing to the mining and energy industries.
Mr. Campbell Smyth, Executive Chairman of Fitzroy Minerals summed in the news release, "We continue to make progress on the acquisition of Ptolemy. The Buen Retiro Project is a transformational asset for Fitzroy Minerals and it is a potentially significant IOCG deposit in a copper-rich district in Chile, the world’s leading copper-producing country. There is a real shortage of large open-pittable copper deposits with excellent infrastructure in established mining jurisdictions. Buen Retiro offers Fitzroy Minerals shareholders significant discovery leverage into a copper bull market.”
Below is a couple slides from their presentation that provide highlights of the project and the exploration work and drilling from the past year.
Note some of good long intersects like 138.1 meters of 0.73% copper and 137 meters of 0.45%.
The first round of drill results were excellent with an averaged weighted grade of all intersects of 0.61% copper. The median intersect is 35 meters of 0.52% copper. DDH13 had a nice high grade hit of 38 meters at 3.33% copper. There is a large 3km X 2km copper footprint and with 1300 meter potential strike to NE and 2700 meter potential strike to S and SW. There is also early mining potential by trucking surface copper oxides that was done in the past. Pucobre the vendor is short oxide material for their Biocobre SX/EW plant.
Alert Conclusion
I will give some more detail on this project and Fitzroy's other projects when I do a full report. FTZ's Caballos Copper project is surrounded by majors and their Polimet high grade gold, copper and silver project saw past sales of 734,975 kg at 9.3 g/t gold, 17 g/t silver and 2% copper. FTZ's new Argentina gold project has excellent surface and trench results. All 3 of these projects will see work first half of 2025 including drilling at Caballos.
Once the Ptolemy acquisition closes, FTZ will have about C$6 million cash so can hit the ground running. It is also worth noting the potential reward to FTZ and shareholders with a Pucobre (the vendor) possible buy back option. Pucobre is a strong local partner and only listed Chilean copper producer. They can buy back 30% of Buen Retiro by paying three times 30 per cent of the addition of the following amounts: (i) a fixed amount of $300,000 (U.S.) and (ii) all the investment made by Ptolemy in relation to the Buen Retiro option. Following completion of any clawback, Pucobre will finance the project on a pro rata basis or be diluted.
I like the chart. The stock has broke out but with just it's average trading volume. The stock opened down this morning, on a typical sell the news event. It has come down to the support level at $0.20 and an excellent entry point. There is mild resistance at the recent highs but the next resistance area is around $0.40 so a move to this area would not surprise me. Prices between here and $0.28 look like a good entry point.
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