Copper oxides at Filo del Sol (Photo: NGEx Resources Inc.)

Copper oxides at Filo del Sol (Photo: NGEx Resources Inc.)

The Lundin Group's only mineral exploration vehicle, NGEx Resources (NGQ:TSX) announced fantastic results from their Filo del Sol project in San Juan, Argentina.  They released ten holes today, which continued to help expand the high-grade manto zone.  Filo del Sol is the last of NGEx's three projects without a resource estimate.  The company expects to put out its maiden resource estimate on the project by yearend.

Highlights of this latest ten holes include:

  • VRC70 which intersected 22m of 5.80% Cu (from 146 m) in the supergene blanket plus a 6m interval of 12.41 g/t gold (from 120 m)
  • VRC66 which intersected the high-grade manto zone with 16m of 222g/t Ag (from 358 m), extending the zone by 290 metres to the northwest of previous drilling (FSDH02) and also intersected 20 m of 2.11% Cu (from 238 m) in the supergene enrichment blanket

All ten of the holes were terminated in porphyry mineralization and the Filo del Sol deposit remains open in all directions.  These ten holes span a north-south distance of 2km.

The goal of NGEx's 2014 drill campaign at Filo del Sol is to expand and infill the copper-gold porphyry mineralization and the manto high-grade zone.

A lonely drill rig at Los Helados, high in the Atacama desert (Photo: NGEx Resources Inc.)

A lonely drill rig at Los Helados, high in the Atacama desert (Photo: NGEx Resources Inc.)

The company is undergoing a transformation this year.  They are intending to release their first economic study on the Los Helados project in Chile.  It hosts a staggering 15.3 billion pounds of copper and 8.9 million ounces of gold in the Indicated category.  They are also working to bring Josemaria into the economic-stage of study.  Josemaria itself hosts 6.1 billion pounds of copper and 6.1 million ounces of gold in the Indicated category.

At this point, these are large exploration plays.  However, once they receive economic validation and the street can get a baseline value on the projects, the stock is likely to react.  Due to the geographic complexity of the projects, in particular, the fact they straddle the international border with some projects in Chile and some in Argentina, it is unclear if they will be able to utilize any central processing facilities.  Hopefully this will be cleared up in the subsequent economic assessments that are in the works.

These will be large projects and not for the faint of heart (which suits their company phrase well: "No Guts, No Glory").

They do have large and deep-pocketed project partners in Pan Pacific Copper and JOGMEC (the Japanese government's natural resource arm).  Pan Pacific is building its first large-scale copper mine, Caserones, a mere 20km from Los Helados.

Shares are up $0.15 (~10%) to $1.80 at the time of writing.

Read: NGEx Drills 5.80% Copper Over 22 Metres at Filo Del Sol Project