LKY begins work at NSW copper project - drilling later this year

Our Investment Locksley Resources (ASX: LKY) just moved from the planning to execution stage at its NSW copper project.

LKY’s copper assets sit in the same part of NSW as $690M Aeris Resources and the Cobar copper operations (owned by $15BN Harmony Gold).

(source)

Last week LKY laid out its plan for its NSW copper projects which already host a combined ~11.2Mt of combined resources at ~0.7-1% copper.

The project's resources are currently based on old JORC standards.

Despite all of that, LKY traded at an enterprise value of under ~$10M pre open, holding $14.9M cash at June 30.

Today LKY confirmed that the resource estimates across both projects were now in the “final reporting stage”. (source)

So we could see LKY get both projects up to the point where all of the information is up to date and current.

(Before LKY launches into drilling out the project)

LKY mentioned last week that it was planning drill programs across its two copper projects.

For now though LKY's geologists are re-logging ~8,700m of historical core from 38 holes stored on site - including intervals that previous explorers never assayed.

We covered LKY’s copper assets last week here: LKY identifies copper targets across ~50km trend.

Over the coming weeks we want to see:

1. LKY’s updated resources,
2. A ranked set of drill targets, and
3. Drilling starting (subject to approvals and access).

Copper is looking strong too

Copper might have finally woken up to all of the talk about the demand/supply dynamic that has been going on for more than a few years now.

It has had a consistent rise for more than 12 months now and been in an uptrend since 2023:

(source)

The past performance is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.

So it appears to be a good time to be exploring for copper (especially when LKY has been able to pivot to something it already had), and this is a project that there are already results to go on with.

Also on the copper macro, it feels like most weeks that there’s talks of supply issues from Chile through either weather, missing production guidance or other factors including protests:

(source)

What’s next for LKY?

LKY’s current strategy is based around a two staged exploration plan across the district:

• Phase one = Focus on expanding the Mineral Resource base across the district (drilling out the targets identified), AND
• Phase two = Progressing the projects through permitting and feasibility studies looking at potential development options for the project.

Here are the catalysts we want to see LKY deliver:

🔄 Resource updates across both its projects

Right now LKY’s two projects have:

1. A JORC 2012 resource: 9.86Mt @ 0.73% copper and 0.22g/t gold (from Apr 2022) and
2. A historical JORC 2004 resource of 1.3Mt @ 1.0% copper and 0.6g/t gold.

So we want to see the resources combined to a current standard

1. 🔄 Independent resource estimate underway to combine both projects into one up to date figure
2. 🔲 Updated resource released

🔲 Drilling to progress the projects

Right now LKY is planning a 5,500m (28-hole program on its smaller resource.

AND a ~10,000m program across its regional targets.

A drill rig contract is being finalised, with a rig expected to be available later this year, around the same time drilling permits are expected from the NSW Mines Department.

This is been planned in the background so we should see some progress showing on this in coming weeks:

1. 🔄 Ranking targets, plus approvals, access and contractors
2. 🔲 Drilling schedule, which LKY says is coming “in the coming weeks”
3. 🔲 Drilling starts