PTX Metals, de-risking a potential monster Ring of Fire project

Although copper (“Cu“) at today’s $4.72/lb. is a strong price for existing producers, most analysts, pundits, company management teams, and consultants believe $12,000-$15,000/tonne, or $5.44 to $6.80/lb. is needed to get most viable early-stage Cu projects off the fence, into production.

Given the geopolitical headwinds (political, economic, military, trade, etc.). China is holding up well and remains by far the largest consumer of Cu. Its economy has been weaker than usual lately, but GDP growth averaged +5.3% from 2021-24. It’s expected to be +4.0-4.5% in 2025 & 2026.

4%+ growth for the world’s 2nd largest economy is hardly a disaster for critical metal demand. Cu demand could surprise to the upside in numerous ways, see image below. Yet, upside supply surprises are hard to imagine as greenfield projects take 15-20 years to commercialize.

China controls most of global nickel (“Ni“) supply, in large part due to its very considerable involvement in Indonesian Ni operations (Indonesia is > 50% of global Ni supply). Clearly, Ni for Western countries needs to come from outside China/Indonesia/Russia!

Cu/Ni heavy juniors in safe, prolific countries like Canada, the U.S. & Australia with blue-sky exploration potential, close to end markets, and cheap valuations are increasingly sought after.

Tiny PTX Metals (TSX:v: PTX) / (OTCQB: PANXF) has tremendous Cu/Ni potential in Ontario, Canada. It has lesser, but some leverage to platinum, palladium & cobalt, and separate from its flagship project PTX also has meaningful gold (“Au“) exposure.

Note: YTD, platinum & copper are up +20% & +17%, respectively.

Two important press releases this month, and additional drill results fairly soon, (assays from five more holes) has the PTX Metals team excited. Management can’t talk about the next batch of assays, but they’re cautiously optimistic based on visual review of the core.

Last year, PTX published a robust, third-party “resource target” based on a lot of data, but not enough surviving drill core for a NI 43-101 compliant resource estimate. NOTE: PTX Metals has an excellent corporate presentation!

The two PRs modestly de-risk the early-stage, 100%-owned W2 copper Cu/nickel, platinum, palladium, Au, cobalt project in Northern Ontario’s Ring of Fire (“RoF“) area. This is an unknown company with likely over 1.4 billion pounds Cu Eq. (non NI 43-101 compliant, net of est. recoveries) at W2 alone.

W2 is ~75 km SW of Wyloo’s high-grade Eagle’s Nest project –> ground zero of Northern Ontario’s world-famous RoF, a giant, remote, circular structure covering nearly 5,000 sq. km.

Located ~500 km NE of Thunder Bay, the RoF is considered one of the planet’s last remaining, giant, under-explored, poly-metallic geological structures. A new BFS this quarter at Eagle’s Nest could attract considerable attention to the region.

That, and regional politicians talking up the RoF, and Ontario just last week earmarking an additional $3.1B in loans, grants & scholarships to support the creation of a made-in-Ontario critical minerals supply chain that includes new resources & opportunities for Indigenous equity partnerships.

Make no mistake, funds going to Indigenous groups should be helpful (roads, bridges, infrastructure, power, internet, etc.) to both Ring of Fire communities and companies like PTX Metals.

Non-compliant “exploration target” –> 31-284Mt @ 1.25-0.58% Cu Eq. (100% recoveries)

In the above chart, indicative in-situ Cu Eq. metal ranges from 389K to 1.641M tonnes, equal to 858M to 3.62B pounds Cu Eq. This exploration target is being de-risked with drilling and other important exploration work.

On May 27th CEO Greg Ferron released assays on two holes that advance W2 nicely due to, 1) wide widths, 2) shallow depths, 3) promising grades, 4) increased continuity, and 5) a better understanding of geology & structure.

Looking at all five of those factors in unison, and considering that mineralization remains open at depth, makes W2 of interest to large & very large players in/around the RoF. 

Hole W225-10, designed as for infill & expansion near drilling done by Inco, returned 235 m, from 20 m (widest near-surface mineralized interval to date).

Some don’t like the use Cu equivalent grades, but I provide them for comparison as many companies report in Cu Eq. W225-10 intercepted continuous near-surface intervals throughout 235 m at 0.55% Cu Eq, or 0.17% Cu, 0.08% Ni & 0.18 g/t (Au+Pt+Pd), including:

• 26.1 m at 0.60% Cu Eq [26.1 m of 0.30% Cu, 0.07% Ni & 0.14 g/t (Au+Pt+Pd)]
• 5.4 m at 1.30% Cu Eq [5.4 m of 0.59% Cu, 0.14% Ni & 0.29 g/t (Au+Pt+Pd)]
• 29.0 m at 0.77% Cu Eq [29.0 m of 0.25% Cu, 0.15% Ni & 0.14 g/t (Au+Pt+Pd)]
• 42.0 m at 0.61% Cu Eq [42.0 m at 0.22% Cu, 0.12% Ni & 0.15 g/t (Au+Pt+Pd)]
• 13.0 m at 0.89% Cu Eq [13.0 m of 0.30% Cu, 0.14% Ni & 0.36 g/t (Au+Pt+Pd)]
• 6.6 m at 1.02% Cu Eq [6.6 m of 0.43% Cu, 0.20% Ni & 0.42 g/t (Au+Pt+Pd)]
• 0.7 m at 2.57% Cu Eq [0.7 m of 1.50% Cu, 0.29% Ni & 0.43 g/t (Au+Pt+Pd)]

W225-11 intercepted the CA2 Zone over 58 m of core length from 37.0 to 95.0 m and returned 0.27% Cu, 0.21% Ni, and 0.23 g/t Au+Pt+Pd, equal to 58.0 m at 0.92% Cu Eq, including multiple shorter higher-grade intervals such as:

17.0 m at 1.70% Cu Eq [17.0 m of 0.50% Cu, 0.40% Ni & 0.33 g/t (Au+Pt+Pd) and 2.1 m of 1.32% Cu, 0.26% Ni & 0.20 g/t (Au+Pt+Pd) NOTE: 1 yr. trailing avg. prices used for Cu Eq. calc., Cu $3.82/lb, Ni $8.45/lb, Co $13.97/lb, Pd $1,138/oz, Pt $957/oz & Au S$2,016/oz.

Results successfully confirmed the continuity of the mineralized horizon. Importantly, W225-11 was 3 km to the east, yet delivered similar results. It wouldn’t take a lot of these higher grades to move the needle on the overall bulk tonnage grade.

The highest values in the two holes (from at least 1.0 meter widths) were 2.86 & 5.59 g/t Au, 1.32% Cu, 1.47 & 1.48% Ni, 0.66 g/t Pd, and 0.52 g/t Pt.

Mr. Ferron commented,

“Holes W225-10 & W225-11 intersected broader & deeper zones of mineralization than previously reported, demonstrating improved continuity and the potential to significantly expand both CA1 & CA2 at depth. These results start validating the exploration target issued last September, which outlined a large near-surface project and improves the understanding of our exploration model.“

Around the world, Cu is profitably mined at grades as low as 0.20 to 0.30%. I estimate up to a third comes from grades at or below 0.35% Cu, mostly from Canada, parts of Africa & S. America. Therefore, large scale is critically important.

PTX’s 3D geological & grade shell modeling of historic & recent drill results shows a near-surface target of 31-284 million tonnes of 1.25% to 0.58% Cu Eq. Given a strike length of 8 km, some think 500M tonnes of poly-metallic mineralization is possible.

That’s why many companies  — Rio Tinto, BHP, Glencore, Vale (Canada), Teck Resources, Anglo American, Evolution Mining, [Sumitomo Corp., Mitsubishi Corp, Mitsui & Co., Marubeni Corp.], Boliden AB, South32, Hudbay Minerals, KoBold Metals, Wyloo Metals, and Juno Corp. are likely watching W2’s progress. 

Readers should note that although Wyloo, Juno & KoBold are private, each has ample cash and would make great partners on PTX’s W2. KoBold is valued at ~US$3B, (Bill Gates / Jeff Bezos are shareholders), it is heavily invested in Cu/Ni/Co/Pt/Pd assets globally, incl. a lithium investment in Ontario.

On May 7th a refined 3D geological interpretation and Heli-GT Magnetic Survey results for the Central Target area were announced. PTX engaged an independent consulting firm to create a 3D geological model and in-house resource estimate using the recently flown Mag Survey, along with newly compiled drilling data.

From the May 7th PR,

“This model outlined a direct correlation of mineralization with a lithology unit, for which geophysics methods have emphasized the continuous nature of the targeted domains. Initially modeled as discrete zones (CA1, CA2 & AP) in the Exploration Target released in Sept. 2024, the new interpretation highlights the potential continuity of the mineralization as one or more Cu-Ni-Au-PG-bearing horizons that can be traced for ~8 km.”

PTX has other properties, including the South Timmins JV (75% PTX / 25% Fancamp) with Au assets in the Abitibi Greenstone Belt and a 51% interest in Green Canada Corporation, with uranium assets in Saskatchewan, Ontario & Quebec.

The Company’s 23,242 hectare Shining Tree Au/silver/Cu project (75% PTX) is a distict-scale Au property. It’s on trend with Newmont’s Borden Mine, through the area of IAMGOLD’s Côté Gold mine, and across Aris Gold’s Juby Project.

The project includes one historical gold producer and > 30 underground developments & prospects. Drill hole HU89-08 intersected 35.4 m of 1.1 g/t Au.

Heenan-Mallard (75% PTX) is 100% Au, covering 5,194 hectares, adjacent to Evolution Mining’s October Au project & the Côté Gold mine. An historical 12-hole drill program returned 5.0 g/t Au over 3.7 m, 6.6 g/t Au / 1.8 m, and 5.3 g/t Au / 3.8 m.

PTX Metals also holds a portfolio of seven NSR royalties on Au, PGE, and base metal properties. All of PTX Metals’ properties, projects, assets (except the flagship W2) are open to being spun out or monetized. Those assets alone could potentially be worth the Company’s entire $10M (C$0.09/shr.) valuation.

Finally, I can’t help but to repeatedly point out in articles on PTX Metals that insider buying has been very impressive, especially by Mr. Ferron [2.48M shares owned] and Directors Jean-David Moore [4.71M shares], and Frederico Marques [3.12M shares].

Readers should remember who the audience is for PTX Metals (TSX-v: PTX) / (OTCQX: PANXF). Yes, retail investors, yes institutions, but also the many much larger companies mentioned throughout this article.

W2 appears to be a huge system that will require A LOT more drilling over several years, but that’s where a strategic partner comes in. Assays are pending from five more holes. If they’re as good or better than the two just reported, management will be in a strong position to negotiate with strategic investors.

Please take a look at PTX Metals’ excellent Corporate Presentation.

Disclosures/disclaimers: The content of this article is for information only. Readers fully understand and agree that nothing contained herein, written by Peter Epstein of Epstein Research [ER], (together, [ER]) about PTX Metals, including but not limited to, commentary, opinions, views, assumptions, reported facts, calculations, etc. is not to be considered implicit or explicit investment advice. Nothing contained herein is a recommendation or solicitation to buy or sell any security. [ER] is not responsible under any circumstances for investment actions taken by the reader. [ER] has never been, and is not currently, a registered or licensed financial advisor or broker/dealer, investment advisor, stockbroker, trader, money manager, compliance or legal officer, and does not perform market-making activities. [ER] is not directly employed by any company, group, organization, party, or person. The shares of PTX Metals are highly speculative, and not suitable for all investors. Readers understand and agree that investments in small-cap stocks can result in a 100% loss of invested funds. It is assumed and agreed upon by readers that they will consult with their own licensed or registered financial advisors before making investment decisions.

At the time this article was posted, PTX Metals was an advertiser on [ER] and Peter Epstein owned shares in the company.

Readers understand and agree that they must conduct due diligence above and beyond reading this article. While the author believes he’s diligent in screening out companies that, for any reason whatsoever, are unattractive investment opportunities, he cannot guarantee that his efforts will (or have been) successful. [ER] is not responsible for any perceived, or actual, errors including, but not limited to, commentary, opinions, views, assumptions, reported facts & financial calculations, or for the completeness of this article or future content. [ER] is not expected or required to subsequently follow or cover events & news, or write about any particular company or topic. [ER] is not an expert in any company, industry sector or investment topic.