Automated transcript · Written by software from the replay's audio. It can mishear names and figures; the replay is the record.
0:10 Thank you for the introduction. My name is Stephen Stewart and I couldn't agree more with what Kai said about young people in the industry. I wear a lot of hats. I'm certainly involved with a few companies, including young mining professionals. And it's so great to see the next generation come up here and talk about making discoveries. Our people are our most important assets. And I really like Joanna. I had the opportunity to meet her before. However, we have made a discovery this year, Joanna. I'm gonna talk my book here a little bit. There's a company called the Wale. And we made a discovery. We drilled 45 grams over 32 meters. That's a discovery. I mean, I've never been associated with a drill hole like that. Now, I'm here with QC Copper, and I'm going to talk QC Copper. But that is certainly a discovery that I want to put on everybody's radar screen.
1:01 QC Copper is a little bit different. The discovery has been made, in fact, the discovery was made probably close to 100 years ago. This is a brownfields situation. In fact, it's 4 high-grade, what used to be 4 high-grade underground mines that we have reinterpreted into a large open pit deposit right in the middle of Quebec. And as Adrian said, it's actually the highest grade open pit copper deposit in Canada. Not only that, it's on the rail, it's on the road, it's got access to power, it checks all the boxes. I don't think to my mind I can name a single project, certainly not in Canada, that has access to infrastructure like this project does. And I have always said that if the highest grade open pit copper deposit in Canada with all this infrastructure doesn't work, what does?
1:51 Right? So it doesn't mean that this is a slam dunk. It's not. We've got challenges. Our biggest challenge, which I'll talk about, is our social license, which is probably the biggest challenge across all the mining industry. Aside from its young people, going back there, I think the fact that we don't have young people is our biggest challenge. But nonetheless, project specific, it's social license. And we, as a result of being in a Brownfields environment, there was a town that grew up in and around what is now the deposit, and the town is now our biggest risk. And that's something that we're investing in significantly, and something that we believe is overcomable. The town is on side, the town wants this deposit because it's a small town, nice town, but it's depleting, okay? And it needs reinvigoration. And there's a model, and the model I always point to is Canadian Malarctic, which is Canada's largest gold mine, made famous, of course, by the Smart Fellows at Osisko, and they're right next to the town of Malarctic, which 25 years ago there was not much going on, but now you go to Malarctic, there's car dealerships and snowmobile dealerships, insurance companies and so on and so forth. And so that's the promise that QC Copper through its project called the Opamysga offers to the town of Shopei going forward. So I will walk you through the more salient points, of course, as our forward-looking statement. I think...I hate talking about the commodity price. I don't know where commodity price is going. Nobody does.
3:15 If they do, they're selling you. If they say they do, they're selling you something. But there's no question that the narrative around copper is back. And I think narrative is important. Narrative doesn't mean where copper price is going. It means what people are talking about. And copper is probably, well, I would say it's replaced lithium. It's replaced uranium in terms of the most popular commodity. And those 2 commodities have been on the top of everybody's tongue the last 2 years, but now it's copper. And I think that's important. So again, it doesn't indicate where copper price is going, but it does have an indication of where the capital is flowing. And that has been one of the biggest challenges over the past 2, if not 12 years, is our capital pools are shrinking. And as a result, our market caps collectively are shrinking. But when the narrative shifts, and it is shifting, that capital pool gets larger, and by and effect, all boats will rise.
4:07 As of late, we've seen high flyers like O'Reilly, another company in our group called American Eagle, those have been the outliers. Those are rocking and rolling, and there's FOMO, and people are piling in, and I say for good reason. But those are the only companies that are moving in terms of share price appreciation. I'll show you how Quebec Copper has not moved basically an inch despite publishing this highest grade resource in Canada and despite, perhaps more importantly, certainly with the narrative aspect, copper going from $3.50 to $4.50. It's the big guys that move. It's the ones that have high flyer holes, whereas QC copper is sort of slow and steady in the sense that discovery's been made. This is a reinterpretation. We've spent the past 2 and a half years and nearly $20 million in fill drilling and de-risking this project, but not necessarily outstep drilling, not necessarily discovery. And that's where we are in the Lassonde curve.
5:05 But I think what's important for those who are patient investors in this industry and patience is required in this industry, is that now we're in a bit of a golden period where you can identify projects that are good, high quality projects run by good teams, and I think I'd put my team up against anybody's team, with people who have the ability to raise money, because that was one of the, Joanna, again, wonderful presentation. She had the 3 Ps, but what she missed is capital. If you don't have the ability to raise money, none of the other Ps matter. And our group has demonstrated the ability to raise money time and time again. So that's what you need to identify, people who raise money, good projects run by good people.
5:51 And then look for sort of charts like this. I probably should have narrowed in this chart, but basically this is what is showing is we're just flat. And this is, I would suggest, is representative of 80, maybe even 90% of the copper and the gold companies yet. We just haven't moved. But the good news is if the narrative does continue on its course, we will move. And you can purchase this at the price that we were prior to publishing the highest grade open pit deposit in Canada. Prior to copper moving to $4.50, that opportunity exists right now. But you have to be patient, because I don't know when the sentiment's really going to come and allow all boats to rise. And I would never suggest that you invest in all boats in this industry. Far from it. You should only invest in the top 20%. The other 80% are, I guess as Rick Rule would say, nothing more than liabilities.
6:38 And that is an absolute fact. You have to be very discerning in who you pick. But again, if you can pick the projects that are high quality, run by good people who have access to capital, now is a phenomenal time to be placing bets in this industry. Some say generational opportunity. I don't know. That's flamboyant language. But there's certainly, if you can be patient, there's an awful lot of value to be had in this industry because so much value has been destroyed over the past 3 years, again, arguably the past 12. More specifically to our project, this is a chart here of the highest grade open pit copper deposits in Canada. You see all the big names, Tech, Glencore, Newmont, Coupram, another plug from one of our group companies there, high-grade deposit, Taseco, etc.
7:25 But you see QC Copper at the far left, again indicating we are head and shoulders in terms of grade, in terms of open pit copper deposits. And you can see our copper grade is nearly 0.8% copper. If I cheated a little bit and called an included copper equivalent, we'd be at nearly a full percent. And the copper equivalent would include gold and silver, of which are nice metals to have that are payable. This is what the deposit looks like in terms of not just grade, but we have size. We are, in American speak, we are 2.2 billion pounds of copper equivalent. It's very large, you know, it's not the size of a copper porphyry deposit that, again, Joanna referenced down in Chile or in British Columbia like American Eagle has, where it has the potential to be 5, 10 billion pounds of copper. But this is just right, okay? And in terms of right size, I think of it as the Goldilocks of projects.
8:25 It's something that could be developed this cycle. Whereas those porphyry deposits, those are 1, maybe 2 cycles away. This project is big enough, which is important for base metal, but not so big that the CapEx is gonna be billions, okay? This is gonna be hundreds of millions. We don't know how many hundreds of millions, but it's the right size. And again, we have all that infrastructure in place which reduces our capex exposure, which allows you to get away with smaller projects, lower grade, not that we have either of those 2 challenges. Again, our biggest challenge is the social license risk. This is what we look like in terms of what style of mineralization. Another sort of confusion level on this project, it's an orogenic copper gold deposit, which is unique. You don't see too many orogenic copper primary projects, especially in eastern Canada. So people sort of look at this like, what's this? Is it porphyry? No. It's orogenic. Usually, you see these types of systems, these stacked vein systems, or typically gold systems. But we have gold credit. There's lots of healthy gold payable here, but it's a copper deposit, and it is unique.
9:29 And I should point out that what you see here and what you see in this open pit, OK, this used to be 2 out of the 4 mines here that you can see that were operated by what is now Glencore. We have yet to drill out the third and the fourth. So that's part of our plans for later in 2024, 24 is to, currently recompiling all the historic data using all fancy technology to take what was analog, bring it into the digitized world so we can understand what it is and design what we think is going to be a robust drill program for the cook and the roboti. But really the meat on the bones is again defining the economics on this open pit. We'll come out with a PEA.
10:16 We're working on it. I haven't yet announced when we expect it to be published. What we're doing right now is we're evaluating the best mind plan. Again, this relates to our social license and how we're gonna go about delivering a mind plan that is acceptable to the community, acceptable to the province, and of course acceptable to our shareholders. How impactful are we gonna be on this town, and what are the benefits that they're gonna receive? Again, they want it, but they wanna make sure it's done with great care to the environment and they want to make sure that it's great care towards economic impacts to the communities. They want to make sure it's done right. So this is just sort of an overlay here. So again, this is where the open pit is. That's a life of mine. That's a 100 million ton deposit there outlined there. What you're seeing up there in the drill holes areas up to the northeast there, that's just the preliminary stuff on the Cook and the Robitaille. Those are the third and the fourth mine, as I refer to them.
11:15 We have not yet drilled those out, but we did sort of a scout program earlier this year, a very modest drill program, but we're looking to try and connect these 2 deposits. I'll note that these deposits, the Cook and the Robitaille, are not constrained as per the town. So that's an area of relatively low-hanging fruit growth because we know a fair amount about the geology. And if we can build resources in and around an area where we already think this Opomiska MRE, that deserves a mill. We think that has enough robust copper and gold in there to justify the CapEx. And if we can prove that, then everything else in and around it, and I assure you, I'm not sure if I have it in this slide here, I do here, I'll just fast forward here, I'll show you, this is the town, or this is the district of Shibugamu.
12:04 I have a, beyond the project focus on the Opumiska, where we're defining this open pit deposit, and we're gonna put a mill, I have a vision for this entire district of Shibugamu, which is where most of the copper came out of eastern Canada for the 20th century. This is a major, major district, very mature district here. And you can see those are all mines, you know, stuff in the northeast there. We don't control that. And there's other deposits there that are effectively real deposits that have been drilled out, but they are orphans because they're not big enough or high enough grade or close enough to surface to justify their own mill. But the good news is the Opamiska is, and it's right there, it's on the rail, it's on the road, it's in easy trucking proximity to all these things. So the Opamiska itself has multi-decade potential, life of mine, but beyond that, given the endowment in the Shibugumu District and the access to infrastructure, putting a mill here would potentially give this multi-generational potential.
13:02 That is a forward-looking statement, but that's the vision, that's the potential that we have here, and it all starts with Opemiska. And our hope is by 2024, we'll start that with the PEA and start talking about what this really looks like. Again, I've touched upon this, but again, the town of Shopei, which is the town that serviced the Opamiska mine for nearly 50 years, they are on our side. We just had a new mayor elected there. As I said, we've been down to Malarctic with them and we've showed them what mining, what wealth and the ancillary businesses that mining can create. It's a business unlike no other where you can create wealth where there was nothing before that. And they're on side. And I think in the coming year, we hope to get them more on our side publicly. As I wrap up, I'll note again this just goes back to, it's not specific to QC Copper, but it's specific to who we are as a group. We're a Toronto-based group.
13:57 I'm the chairman of the Orr Group. I'm usually the largest shareholder in each of these companies and I was involved in the formation or certainly controlling shareholder. There's 7 publicly traded companies here and Coopram is a copper deposit in Ontario we're going to be taking public at the end of this year. We are a very serious well-financed group who act like owners. We treat our investor capital like owners. We spend our money carefully. We invest in the troughs. Well, I should say we acquire in the troughs. I'm still, just like I'm telling you, you should buy QC Copper because we haven't moved yet. I am buying assets because they are still being priced as if the industry is in distress, and it still is in distress. So there's still an opportunity for shareholders to buy shares in good quality companies, but there's still an opportunity for somebody like me who likes to go out and buy assets.
14:45 And I think that'll probably give me, I'll probably have 12 more months in there before the capital comes in and everything becomes overpriced because that's what happens in this industry. So don't forget to sell your shares when we're fully valued. Aside from that, I think I'll wrap it up there. My name is Steven Stewart. I'm the CEO and Chair of QC Copper, and I'm happy to answer any questions. Yes, sir. One of the assets is state and base load. So as a part of your group, what's the purpose of holding shares of those 2 uranium companies? It's a good question. So for clarity, QC Copper spun off baseload energy 3 years ago. Speaking to cyclicality, we started baseload when uranium was $19. I recruited a young geologist by the name of James Sykes who is a bloodhound for uranium And I engaged him and hired him and said, I'd pay your bills if you go find some uranium deposits. And he did.
15:39 And we used QC Copper as a spinoff vehicle, which had an encore asset and which gave us, at the time, 18 million shares of baseload. 3 years ago, we sold 7 million of those shares for $8 million, which I've since reinvested back into the Opamesca, and we retain 10.7 million shares of base load. Base load has 20 million dollars in cash, and is investing 15 million dollars into its drill programs this year. It's currently at its two-year low and I don't sell things at two-year lows. There will be a time when QC Copper sells its position in baseload but it's not today. Okay, thank you very much, Stephen. My pleasure. Thank you.
