REG - Phoenix Copper Ltd - Final results for the year ended 31 December 2022
25/05/2023 07:00
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RNS Number : 5587A Phoenix Copper Limited 25 May 2023
25 May 2023
Phoenix Copper Limited
('Phoenix' or the 'Company')
Final audited results for the year ended 31 December 2022
Notice of AGM
Phoenix Copper Ltd (AIM: PXC, OTCQX: PXCLY), the AIM-quoted USA-focused base
and precious metals emerging producer and exploration company is pleased to
announce its audited results for the year ended 31 December 2022. All
references to $ are United States dollars.
Highlights
Corporate & Financial
- Investment in Empire Mine increased to $33.10 million (2021:
$26.12 million)
- Net assets increased to $37.84 million (2021: $37.78 million)
- Group reports loss of $1.57 million (2021: $969,250), after
charging a non-cash related foreign exchange loss on sterling denominated
assets of $564,353 (2021: foreign exchange gain of $173,358)
- Year-end cash balance of $4.66 million (2021: $13.05 million)
- Company loans to Idaho operating subsidiaries increased to $30.61
million (2021: $21.41 million)
- Group acquisition of third party royalties payable by Empire Mine
- $80 million issue of floating rate, listed, secured,
non-convertible, minimum 8.5% copper bonds due 2028-2032 nearing completion
- Inaugural Sustainability Report published and 'A' rating scored on
Digbee ESG Platform
Operational
- Completed core drilling at Empire open pit copper mine to support
metallurgical recovery and process design using non-toxic ammonium
thiosulphate ("ATS")
- Continuity of open pit mineralisation further confirmed, including
intercepts of up to 12.8% copper, 269.10 grammes per tonne ("g/t") silver and
0.75 g/t gold
- ATS metallurgical testing underway to support recovery and
processing of copper, gold and silver in one process
- Ongoing drilling encounters further mineralisation at Red Star
silver-lead deposit
- 60 hole 2023 Navarre Creek gold drilling programme approved by US
Forest Service
- Local Community Advisory Team created as part of the Company's ESG
Programme
Annual General Meeting
The Company also announces that the Annual General Meeting ("AGM") will be
held at The Washington Hotel, 5 Curzon Street, London W1 5HE on 8 June 2023 at
11.00 BST.
The Notice of AGM and Forms of Proxy will be despatched to shareholders on 24
May 2023 and will be available on the Company's website at
www.phoenixcopperlimited.com (http://www.phoenixcopperlimited.com) .
The Company's Annual Report and Consolidated Financial Statements for the year
ended 31 December 2022 will also be available on the website from 25 May 2023.
CHAIRMAN'S STATEMENT
Dear Shareholders
Reading through my statement in last year's annual report and comparing it
with my interim statement, I am struck by the favourable niche that we find
ourselves in within the mining sector globally. Although the second half of
2022 brought many challenging head winds, we remain poised to produce metals
vital for the global transition to clean energy and we operate in a
geopolitically stable and mining friendly jurisdiction. Nevertheless, despite
metal prices now recovering nicely, steel, diesel and reagent costs remain
elevated, making many mining projects uneconomic. The current copper price is
in the region of $8,500 a tonne. Many analysts estimate that a copper price
comfortably over $10,000 a tonne will be required for some junior developers
to be able to fund new copper mines, particularly with the recent rises in
interest rates. I am convinced that this will not be the case with Phoenix at
Empire.
I mentioned in my last two statements that we intend to fund first production
at the Empire open pit with minimum additional dilution to shareholders. With
that in mind, we are in the process of completing an $80 million corporate
copper bond issue, which will pay a floating rate linked to the higher of a
copper price coupon or an interest rate coupon, but subject to a minimum
coupon of 8.5% per annum. The bond will be listed on The International Stock
Exchange ("TISE") in the Channel Islands. Although there can be no certainty
until the final paperwork is received, we believe that the issue will be fully
subscribed, and we hope to update you shortly in this regard.
Necessity being the mother of invention, the technical team spent much of the
year examining ways of reducing dependence on reagents, which represent over
60% of costs in many mines, and diesel. I draw your attention to the CEO's
report in which he describes how we have managed to extract copper, as well as
gold and silver, using environmentally friendly ammonium thiosulphate ("ATS"),
from bulk samples in the laboratory. If we are able to do this on an
industrial basis, our operating costs could be significantly reduced. We hope
to submit these adjustments to the Plan of Operations in Q3 this year, to keep
the permitting process for the Empire open pit mine on track.
While on the subject of the environment, we also significantly boosted our ESG
credentials, producing our first Sustainability Report, which includes much of
the material we submitted to the Digbee ESG rating platform. A growing number
of miners are signing up to Digbee, which, after detailed specialist
questioning, generates an ESG rating; this is then used by an increasing
number of investors in their decision making. I am delighted to report that we
scored an "A" which, I understand, is the highest score awarded so far. I
would like to thank especially Catherine Evans, Chair of our ESG &
Sustainability Committee, and Lenie Wilkie, our ESG Program Co-ordinator in
Mackay, Idaho, for all their hard work in this field.
Although around 65% of our revenues from the Empire open pit project will come
from copper, we also have significant precious metals potential, including our
gold and silver projects at Navarre Creek (gold) and Red Star (silver).
Although there has been an industry wide shortage of drilling crews and
equipment, we have conducted successful drilling programmes at both Red Star
and at Empire, which are covered in more detail in the CEO's report, and we
are looking forward to a 60 hole drilling programme at Navarre Creek, starting
in June, focusing on areas which showed promise in our magnetic survey.
Navarre Creek is several times larger than the Empire open pit and surrounding
area, and the early geological indications are that it compares favourably
with deposits on the Carlin trend in neighbouring Nevada, which went on to
become multi-million ounce producing gold mines.
However, in the short-term, copper remains the driving force and creator of
initial cash flow for Phoenix. Although the copper price continues to
fluctuate, the long-term fundamentals remain strong. Grades of contained metal
have been declining steadily over the last 30 years and the new discoveries
being put into production are needed to replace existing reserves rather than
creating surpluses. The latest giant mine to go into production is Rio Tinto's
Oyu Tolgoi or Turquoise Hill in Mongolia, which is forecast to produce
400,000-500,000 tonnes of copper per annum in 2027 (2.5% of current annual
global mined copper), and has taken 20 years to develop. Research think-tank
Wood Mackenzie estimates that the move to renewable energy will create demand
for an additional six million tonnes of copper per annum, or 12 new Oyu
Tolgois. Much of the new production expected over the next decade is from
existing mines, mainly in the DRC, Chile, Peru, Indonesia, Argentina, and
Panama, which will come nowhere near to achieving this target. Accordingly, we
are happy to be based in the comparatively safe and stable USA, which is a net
importer of copper despite its substantial production, and our strategy of
predominantly using our own cashflow from the Empire open pit to prove up a
world class copper sulphide deposit underneath remains the same.
Another harbinger of stronger copper prices is the recent uptick in M & A
activity: Glencore/Teck Resources, BHP/Oz Minerals, Lundin Mining/Caserones
and Newmont/Newcrest. Electric car makers are also showing interest in
securing supplies of critical metals such as lithium, cobalt, and copper.
As we edge closer to production as well as adding value to our gold, silver
and cobalt properties, I would like to thank the technical team for some
outstanding ideas in a challenging environment, our Finance Director for our
innovative copper bond, and most importantly, you, the shareholders, for your
continued support and patience.
Marcus Edwards-Jones
Executive Chairman
24 May 2023
CHIEF EXECUTIVE OFFICER'S REPORT
Principal activities and review of the business
Driven by a $5.00 per pound ("/lb") copper price and ample cash reserves
resulting from an oversubscribed financing in 2021, 2022 was a busy year as
the Company executed a well-developed and robust work plan at our Idaho
projects. Accomplishments included core and reverse-circulation drilling,
geophysics, metallurgical testing, and feasibility engineering. We completed
construction of the mine office, operations warehouse and core logging
facilities, and the construction of a long-term monitoring well network. In
addition to field operations, the Company invested in new employees, including
a new General Manager as well as USA and UK PR/IR professionals. We also
executed a plan for acquiring a large tract of the Empire Mine mining claims
and production royalties, and we continued to advance the Company's ESG
program. The work plan dovetailed nicely with the recently announced US
Infrastructure Bill and the US Defense Production Act, both of which drive
future domestic metal production and provide a domestic market consisting of
national defense products, electric vehicles, and the means to transmit and
store power generated by renewable energy sources.
The 2022 core drilling program at the Empire copper deposit was initiated in
June for the purpose of collecting samples three-dimensionally representative
of the oxide portion of the deposit for copper, gold and silver recovery
testing using the non-toxic cyanide alternative, ammonium thiosulfate
("ATS"). The Company completed 3,502 feet (1,067 metres) of drilling through
early October. The drilling program was successful and provided the
necessary volume of core at the desired copper-gold-silver grade to generate
high quality samples for the metallurgical test work.
An abbreviated, late season reverse-circulation ("RC") drilling program was
initiated and completed in November. The program consisted of 875 feet (268
metres) of drilling at North Pit/Red Star and targeted magnetic anomalies
identified during the 2021 ground magnetics survey. Assay values for copper,
silver, lead, and zinc were consistent with previous drilling programs in the
area and added significantly to our understanding of the mineralogy and
structural regime of the area.
At the Company's Navarre Creek gold project, the proposed drilling plan was
approved by the US Forest Service in August. This cleared the way for a 2023
drilling program comprised of up to 60 RC drill holes on 30 drill pads that
will target geochemical anomalies identified from previous surface sampling
programs, and geophysical anomalies identified in a total field magnetics
survey and hyperspectral mineral survey conducted in 2021. The surveys are
comprised of 169-line kilometres of ground-based and airborne imaging that
identified two distinct intrusive bodies concealed by glacial till, and a
2.3-mile-long by 1-mile-wide zone of strong hydrothermal mineralization
typical of large-scale gold and silver deposits found in northern Nevada, USA.
It is my opinion that the Navarre Creek project is as fine a grassroots
exploration project as any that exists in the western US today. While there
is no guarantee that any exploratory drilling program will result in the
discovery of a viable ore deposit, the geology, mineralogy, and geochemistry
of Navarre Creek fits all the criteria necessary for a potentially significant
gold bearing system.
The long-term monitoring well network constructed both cross- and downgradient
of the proposed Empire Mine operations was completed and will provide sampling
points sufficient for tracking groundwater characteristics throughout the life
of mine. Data from these wells will augment data collected in a Controlled
Source Audio-frequency Magnetotellurics (CSMAT) survey conducted in late
summer and designed to identify geologic structures and rock characteristics
that control groundwater movement, providing vital hydrological information
for future operations.
A new office building, operations warehouse, and core logging facility were
constructed in Mackay, Idaho and will serve all future operations in and
around the Empire Mine. The new facilities were constructed with adequate
space for future expansion.
The Company also took the opportunity to finalise the acquisition of the
Empire Mine patented and unpatented claims formerly owned by Honolulu Copper
Company and the associated 2.5% production royalty, as well as acquiring an
additional 1.0% production royalty from Mackay LLC. The former Honolulu
claim blocks form the northern half of the Empire Mine holdings, including
North Pit/Red Star and the deep sulphides, while the Mackay LLC royalty
applies to production from the southern portion of the proposed Empire open
pit and sulphides underlying the oxide resource.
The engineering design and environmental permitting process for the Empire
open pit mine began in late 2017 with the initiation of environmental baseline
studies and the submission of an initial Plan of Operations in 2021. The
process design engineering necessary for completing a feasibility study, and
ultimately completing the Plan of Operations for approval by the regulatory
authority, is in progress and is centered around the current ATS metallurgical
test work. The results of that work will provide a final process design for
the recovery of copper, gold, silver, and possibly zinc, and will be
incorporated with all the drilling, analytical, engineering, and baseline
environmental data collected on the project to date. The feasibility study
will use the updated polymetallic recovery process to assign mineral reserves
based on the calculated capital and operating costs required for the designed
process and will hopefully further enhance the project economics through
reduced operating costs and the ability to recover copper, gold and silver
from the outset, rather than through a phased approach.
The Company's cobalt holdings at the Redcastle Idaho Cobalt Belt property in
Lemhi County were signed to an earn-in agreement with Electra Battery
Materials (formerly First Cobalt Corporation), the Toronto-based owner of the
Iron Creek cobalt mine, which shares a common border with the Redcastle
property, in 2021. The earn-in agreement included an initial payment of cash
and Electra shares to Phoenix, followed by two work commitments of $1,500,000
each over a five-year period, thereby earning Electra a 75% interest in the
property. Electra's most recent drilling results from the Iron Creek property
are encouraging. Our Redcastle property borders Iron Creek on the east and I
particularly look forward to the drilling results from the eastern side of
Iron Creek, nearest Redcastle.
Empire Mine - Polymetallic Open Pit Oxide Deposit
An updated NI 43-101 compliant resource was completed by Hardrock Consulting
in October 2020 and reported for the polymetallic Empire Mine open pit oxide
deposit. The updated resource showed a 51% increase in the Measured and
Indicated category from the previous year's resource. Including the Inferred
resources, the Empire open-pit oxide deposit now contains 129,641 tonnes of
copper, 58,440 tonnes of zinc, 10,133,772 ounces of silver and 355,523 ounces
of gold.
Mineral Resource Statement for Empire Mine, after Hard Rock Consulting October
2020
CLASS Tonnes Cu Equiv % Average Grade Metal Content
Cu Zn Ag Au Cu Zn Ag Au Cu Equiv
% % g/t g/t tonnes tonnes Ozs ozs Tonnes
Measured 8,289,719 0.81 0.42 0.22 11.4 0.327 34,655 18,160 3,031,791 87,036 67,013
Indicated 14,619,340 0.72 0.36 0.18 9.7 0.322 52,888 25,711 4,563,407 151,370 105,899
M+I 22,909,059 0.75 0.38 0.19 10.3 0.324 87,543 43,871 7,595,198 238,406 172,912
Inferred 10,612,556 0.75 0.4 0.14 7.4 0.343 42,098 14,569 2,538,574 117,117 79,296
Empire Underground Sulphides
In July 2021, a core drilling program designed to target the historically
mined high grade sulphide vein system below the open-pit copper oxide resource
was initiated. The first drill hole of the program that reached the design
depth intercepted a 12.6-metre zone of strong to intense sulphide
mineralization. Some of the sulphide minerals identified by our geologists
included bornite, chalcocite, chalcopyrite, pyrite, galena, and pyrrhotite.
Further drilling continued to intercept high grade mineralization across a
suite of metals, including 8.38% copper, significant intercepts of gold,
silver and zinc, as well as anomalous molybdenum and tungsten mineralization.
Red Star - High-grade Silver
Red Star is a high-angle silver-lead vein system hosted in andradite-magnetite
and located 330-metres north-northwest of the Empire oxide pit. Red Star was
identified from a 20-metre wide surface outcrop across a skarn structure.
Surface mineralization is a mix of copper, iron oxides and sulphides, with
strong chrysocolla and bornite showings, exposed in a heavily timbered canyon.
In 2018, three RC drill holes were drilled on the target and assay results
reported the presence of high-grade lead and silver sulphides including
intercepts of 20% lead and 1,111 grammes per tonne ("g/t") silver. In early
May 2019, the Company announced a small maiden Inferred sulphide resource of
103,500 tonnes, containing 577,000 ounces of silver, 3,988 tonnes of lead, 957
tonnes of zinc, 338 tonnes of copper, and 2,800 ounces of gold.
Class Tons Ag Ag Au Au Pb Pb Zn Zn Cu Cu
(x1000) g/t oz g/t oz % lb % lb % lb
(x1000) (x1000) (x1000) (x1000) (x1000) % (x1000)
Inferred 114.13 173.4 577.3 0.851 2.8 3.85 8,791.20 0.92 2,108.80 0.33 745
Following the estimation of the Inferred resource, a second ten-hole diamond
drilling programme was completed in 2020. The assay results from that
program confirmed the presence of the high-grade silver and lead veins drilled
in 2018, but also confirmed the need for greater understanding of the
structural geology in order to direct further exploration. As a result, in
2021 the Company commissioned a ground-based magnetics geophysical survey
which identified four high-amplitude areas of interest, including the original
discovery outcrop. The size and amplitude of the three new areas of interest
appear to be significantly greater than that of the discovery outcrop, whilst
further north-northeast magnetic anomalies trending from the outcrop were also
identified. In a program designed to test and help delineate the boundaries of
the magnetic zones, further exploratory RC holes have been drilled, all of
which encountered further mineralization.
In 2022, 875 feet of RC drilling was completed that tested the magnetic
anomalies identified during the ground magnetics survey. The assay values
for copper, silver, lead, and zinc were consistent with previous drilling
programs. Of particular interest are the results from drill hole RS22-02,
which tested the western margin of a strong magnetic anomaly, assayed 7.62
metres of 142.7 g/t silver, 2.94% lead, and 1.54% zinc. Additionally, drill
hole RS22-04 assayed 9.15 meters of 1.56 g/t gold and 0.32% copper, including
1.52 metres averaging 7.59 g/t gold and 0.58% copper.
Navarre Creek - Volcanic-Hosted Gold Project
The Navarre Creek claim block is located approximately eight kilometres
west-northwest of the Empire open pit mine, and was acquired in 2019 as a
gold exploration project with surface mineralization similar to
volcanic-hosted gold mineralization in northern Nevada, which is home to
several multimillion-ounce gold deposits.
During the summer of 2020, the Phoenix exploration team mapped and sampled the
Company's Navarre Creek property. 90 rock chip and grab samples were
collected in the hydrothermally altered volcanic rocks that make up
the Navarre Creek claims and sent to ALS Laboratories in Reno,
Nevada for geochemical analysis.
Of the 90 samples, 53 were above the detection limit for gold with a high of
0.569 g/t, and 25 above the detection limit for silver. There was also a
strong correlation between elevated gold values and elevated antimony values,
typical in Carlin-type epithermal gold systems. With the exception of one
sample, all samples with a gold value greater than 0.1 g/t occur within the
same alteration type, that being predominantly a jasperoid-hosted quartz
stockwork and micro-veining system. During 2021, a total of 169-line
kilometres of ground-based field magnetics and airborne hyperspectral imaging
were completed for the entirety of the Navarre Creek claim block. Two distinct
intrusive bodies were identified, partially concealed below glacial till,
showing strong magnetic signatures which complement the existing jasperoid
outcrops. A northeast trending corridor of hydrothermal alteration,
approximately 2.3 miles long and one mile wide, was also identified,
consistent with the gold and silver bearing volcanic systems associated with
Carlin-style epithermal deposits.
Markers for Carlin-style gold deposits are the presence of jasperoids, and the
association of gold, antimony, silver and zinc. These markers are found at
Navarre Creek. The results of these surveys, together with the results of
previous exploration, highlight the prospectivity of the claim block. An
initial drilling program is planned to commence in summer 2023.
Empire Mine Expansion - Horseshoe, Whiteknob, and Windy Devil
We have made a point of focusing our efforts on our flagship Empire Mine
projects. However, we have also increased our land position from time-to-time
as our geologists recognize prospective and strategic opportunities. At the
time of the Company's IPO in mid-2017, our Empire Mine property consisted of
818 acres. Since then, including the Navarre Creek claim block, we have
increased the core Empire claim group to 8,034 acres (32.51 sq kms) by
expanding north to the former Horseshoe and Whiteknob Mines and onto Windy
Devil. This expansion covers approximately 30 historic adits, shafts and
prospects, which exhibit geology and mineralogy similar to Red Star, and which
will be the subject of further exploration going forward.
Idaho Cobalt Belt - Redcastle and Bighorn Projects
The Company owns two strategically located properties on the Idaho Cobalt Belt
in Lemhi County, Idaho, Redcastle and Bighorn. In May 2021, the Redcastle
holding was signed to an earn-in agreement with Electra Battery Materials
Corporation (formerly First Cobalt Corporation), the Toronto-based owner of
the Iron Creek Cobalt Mine, which shares a common border with the Redcastle
property. The earn-in agreement included an initial payment of cash and
Electra shares to Phoenix, followed by two work commitments of $1,500,000 each
over a five-year period, enabling Electra to earn a 75% interest in the
Redcastle property. Redcastle is held by Borah Resources Inc, the Company's
100% owned, Idaho registered subsidiary.
The Bighorn property, located on the northern end of the Idaho Cobalt Belt, is
held by Salmon Canyon Resources, another 100% owned, Idaho registered
subsidiary. Bighorn is situated east of the historic Salmon Canyon copper
cobalt underground mine and shares a common border with New World Resources'
Colson cobalt-copper project.
In addition to copper, cobalt is a critical metal for electric vehicles and
global electrification projects. Cobalt deposits are rare, particularly in
advanced jurisdictions. The Company's cobalt projects are located in the USA's
only prospective cobalt region, the Idaho Cobalt Belt, approximately 100 miles
north of the Empire Mine. In 2018, we announced the results of our 2017
reconnaissance program of 46 surface grab samples which gave cobalt values
ranging from two parts per million to 0.31% cobalt.
Outlook
2022 was a year of extremes. Copper rose to a high of $5.02/lb, dropped 35%
to $3.23/lb, and rebounded to close the year at $3.81/lb, still above the
three-year average of $3.67/lb. Gold traded at $2,033 per ounce ("/oz") in Q1,
retreated to $1,659/oz, and finished the year at $1,824/oz. As of Q2 2023,
gold is back to $2,033/oz, a mere 1.5% from its all-time record high. Similar
to the year's metal pricing, the pricing of the goods that we require for
construction of the Empire Mine also faced extreme fluctuations. While we
will be a primary producer of copper and precious metals, we will also be a
primary consumer of diesel fuel, structural and fabricated steel, concrete,
and chemical reagents. Metal prices are our primary concern, but those
materials and consumables required for construction and operations are of
prime importance as they ultimately drive the cost of production and have the
greatest impact on our bottom line. Diesel fuel hit an all-time high in
2022, as did structural steel, concrete, lumber, and reagents. The good news
is that consumables pricing appears to have peaked mid-year and the metals
markets trended the opposite direction. While the costs for structural steel
and some fabricated goods remain elevated, they are slowly returning to levels
not seen since early 2021. The labor shortages for drilling and laboratory
services also remain a concern but seem to be relaxing as government
subsidized Covid programs wind down.
I believe that some market volatility will remain until the war in Ukraine
reaches a conclusion and fears of economic recession wane, but we are seeing
indications of normalization in the mining sector markets and fewer labour
shortages in the manufacturing and fabrication sectors. I look forward to
the day when Covid is no longer an excuse for market volatility. It appears
that may now be the case sooner rather than later.
Despite all of this, the fact remains that copper is in the top three of the
most consumed metals in the world, trailing only behind iron and aluminum. The
heavy focus on green energy metals for power generation, transmission, and
transportation will increase demand, as we are already beginning to realize.
Clean energy initiatives in the United States, Canada, and Europe have already
begun to drive demand for copper, cobalt, and lithium. As other countries
develop similar initiatives, demand will outweigh global supply. Some
analysts are estimating copper demand to exceed supply beginning as early as
2024. Should the war in Ukraine begin to resolve, the reconstruction of the
country will place an additional demand on metal resources.
Although the copper price has decreased on the year, it remains significantly
higher than in the few years preceding Covid, during which the average price
was below $3.00/lb. Compared to those years, the copper market continues to
perform well, with prices holding above $3.50/lb and cobalt above
$55,000/tonne. I expect to see the metals markets, particularly copper and
cobalt, continue to perform well as the EV and "green energy" initiatives
continue to grow globally. I also expect that the spending on the 10-year,
$1.2 trillion US Infrastructure Bill and the recently introduced U.S. Defense
Production Act will increase metal demand and boost pricing in the short term.
The roughly $550 billion earmarked for the construction of roads, bridges,
ports, power transmission, and large water projects, as well as advancing EV
initiatives, will require significant quantities of metal.
Our Idaho projects host both EV metals and precious metals. Our current
metallurgical test work, which is focused on the economic recovery of copper,
gold, and silver in a single processing circuit, will be designed to deliver
crucial metals to the numerous infrastructure and green energy projects in the
global pipeline at the lowest cost possible. Our story becomes even stronger
with the realization that these resources are all located in known mining
districts in the geopolitically stable, pro-mining jurisdiction of Idaho,
USA.
I fully anticipate that market conditions and pricing will continue to
fluctuate to some extent over the next year. However, the timing of
stabilizing trends in the manufacturing and supply sectors, as well as
elevated copper and gold prices, should complement our projects as we
complete the engineering and environmental permitting processes.
Key Performance Indicators ("KPIs")
To date, the Group has focused on the delivery of the project evaluation work
programs to assess the available mineral resources and the extraction methods
to apply, each within the available financial budgets. This work will continue
until the relevant feasibility studies are completed, and construction
commences.
At that stage, the Group will consider and implement appropriate operational
performance measures and related KPIs as the objective of recommencing
commercial production at the Empire Mine nears fruition.
Conclusion
We continue to perform the steps necessary for Phoenix to become one of the
next domestic US producers of metals vital to the transportation,
manufacturing, and energy sectors in the US and abroad. Our team of
engineers, geoscientists, and industry consultants are poised to move the
Empire Mine into production and to properly explore the Navarre Creek, Red
Star, and the Empire sulphides projects.
I would like to thank all our professional staff, consultants and advisors,
all of whom work tirelessly to accomplish our common goal of metal
production. And I would like to thank our community liaisons, shareholders,
and directors for their considerable support. I look forward to reporting
further positive news as we continue our exploration and development programs
during 2023.
Ryan McDermott
Chief Executive Officer
24 May 2023
Consolidated income statement Year Year
Ended Ended
31 December 31 December
2022 2021
Continuing operations Note $ $
Revenue 4 - -
Exploration & evaluation expenditure - -
Gross loss - -
Administrative expenses (1,568,475) (1,065,950)
Other operating (expense)/income (37,777) 106,340
Loss from operations (1,606,252) (959,610)
Finance income 32,104 3,708
Finance costs - (13,348)
Loss before taxation (1,574,148) (969,250)
Tax on loss on ordinary activities - -
Loss for the year (1,574,148) (969,250)
Loss attributable to:
Owners of the parent (1,546,827) (942,850)
Non-controlling interests (27,321) (26,400)
(1,574,148) (969,250)
Loss per share attributable to owners of the parent:
Basic and diluted EPS expressed in US cents per share 5 (1.27) (0.90)
Consolidated statement of comprehensive income Year Year
Ended Ended
31 December 31 December
2022 2021
$ $
Loss for the year (1,574,148) (969,250)
Total comprehensive income attributable to:
Owners of the parent (1,546,827) (942,850)
Non-controlling interests (27,321) (26,400)
(1,574,148) (969,250)
Consolidated statement of financial position
31 December 31 December
2022 2021
Note $ $
Non-current assets
Property, plant and equipment - mining property 6 33,104,230 26,124,030
Intangible assets 7 347,000 330,844
33,451,230 26,454,874
Current assets
Trade and other receivables 8 1,534,507 365,778
Financial assets 9 18,563 56,340
Cash and cash equivalents 4,664,233 13,046,529
6,217,303 13,468,647
Total assets 39,668,533 39,923,521
Current liabilities
Trade and other payables 10 572,470 883,196
Other liabilities 11 500,000 250,000
1,072,470 1,133,196
Non-current liabilities
Other liabilities 11 - 250,000
Provisions for other liabilities 12 757,702 757,702
757,702 1,007,702
Total liabilities 1,830,172 2,140,898
Net assets 37,838,361 37,782,623
Equity
Ordinary shares 13 - -
Share Premium 44,878,927 43,460,747
Retained loss (7,086,480) (5,751,359)
Foreign exchange translation reserve- (18,588) (18,588)
Equity attributable to owners of the parent 37,773,859 37,690,800
Non-controlling interests 64,502 91,823
Total equity 37,838,361 37,782,623
Consolidated statement of changes in equity Ordinary shares Share premium Retained loss Foreign exchange Total Non-controlling interest Total equity
translation reserve
$ $ $ $ $ $ $
At 1 January 2021 - 19,251,964 (5,517,549) (18,588) 13,715,827 118,223 13,834,050
Loss for the year - - (942,850) - (942,850) (26,400) (969,250)
Total comprehensive income for the year - - (942,850) - (942,850) (26,400) (969,250)
Shares issued in the period - 26,018,553 - - 26,018,553 - 26,018,553
Share issue expenses - (1,809,770) - - (1,809,770) - (1,809,770)
Share-based payments - - 709,040 - 709,040 - 709,040
Total transactions with owners - 24,208,783 709,040 - 24,917,823 - 24,917,823
At 31 December 2021 - 43,460,747 (5,751,359) (18,588) 37,690,800 91,823 37,782,623
At 1 January 2022 - 43,460,747 (5,751,359) (18,588) 37,690,800 91,823 37,782,623
Loss for the year - - (1,546,827) - (1,546,827) (27,321) (1,574,148)
Total comprehensive income for the year - - (1,546,827) - (1,546,827) (27,321) (1,574,148)
Shares issued in the period - 1,418,180 - - 1,418,180 - 1,418,180
Share issue expenses - - - - - - -
Share-based payments - - 211,706 - 211,706 - 211,706
Total transactions with owners - 1,418,180 211,706 - 1,629,886 - 1,629,886
At 31 December 2022 - 44,878,927 (7,086,480) (18,588) 37,773,859 64,502 37,838,361
Consolidated statement of cash flows 31 December 31 December
2022 2021
$ $
Cash flows from operating activities
Loss before tax (1,574,148) (969,250)
Adjustments for:
Share-based payments 67,818 191,856
Fair value adjustment to financial asset 37,777 -
(1,468,553) (777,394)
Decrease in trade and other receivables (58,563) (299,818)
(Decrease)/increase in trade and other payables (310,726) 689,259
Net cash generated used in operating activities (1,837,842) (387,953)
Cash flows from investing activities
Purchase of intangible assets (16,156) (53,949)
Purchase of property, plant and equipment (6,836,312) (10,238,492)
(6,852,468) (10,292,441)
Cash flows from financing activities
Proceeds from the issuance of ordinary shares 1,418,180 25,939,203
Share-issue expenses - (1,809,770)
Preliminary bond-issue expenses (1,110,166) -
Repayment of loan notes - (1,549,000)
Net cash generated from financing activities 308,014 22,580,433
Net (decrease)/increase in cash and cash equivalents (8,382,296) 11,900,039
Cash and cash equivalents at the beginning of the year 13,046,529 1,146,490
Cash and cash equivalents at the end of the year 4,664,233 13,046,529
Significant non-cash transactions:
During the year the Directors capitalised $nil (2021: $79,350) of fees into
shares. $143,888 (2021: $517,184) in respect of the charge for share-based
payments and $nil (2021: $500,000) in respect of deferred consideration have
been capitalised into mining property. Loss before tax includes a foreign
exchange loss of $564,353 (2021: gain of $173,358).
1 General information
Phoenix Copper Limited (the "Company") and its subsidiary undertakings (the
"Group") are engaged in exploration and mining activities, primarily precious
and base metals, primarily in North America. The Company is domiciled and
incorporated in the British Virgin Islands on 19 September 2013 (registered
number 1791533). The address of its registered office is OMC Chambers,
Wickhams Cay 1, Road Town, Tortola VG1110, British Virgin Islands. The Company
is quoted on London's AIM (ticker: PXC) and trades on New York's OTCQX Market
(ticker: PXCLF; ADR ticker PXCLY).
The subsidiaries of the Company are:
Incorporated in the United States of America
KPX Holdings Inc (100% equity holding)
Subsidiaries of KPX Holdings Inc:
Konnex Recourses Inc (80% equity holding)
Borah Resources Inc (100% equity holding)
Lost River Resources Inc (100% equity holding)
Salmon Canyon Resources Inc (100% equity holding)
2 Going concern
The Group currently has no income and meets its working capital requirements
through raising development finance. In common with many businesses engaged in
exploration and evaluation activities prior to production and sale of minerals
the Group will require additional funds and/or funding facilities in order to
fully develop its business plan. The Group will also require funds to
construct its first operating mine. The directors believe that such funds are
likely to come from the arrangement of appropriate debt and/or offtake finance
arrangements, including the issue of corporate copper bonds currently
underway. Further equity issues will be minimised as far as possible.
Ultimately the viability of the Group is dependent on future liquidity in the
development period and this, in turn, depends on the availability of funds.
During the year the Company raised $1.42 million by way of the exercise of
warrants.
The directors prepare annual budgets and forecasts in order to ensure that
they have sufficient liquidity in place and that they comply with the terms
and conditions of their obligations in relation to the ongoing development of
the mining assets and the Group's environmental and other commitments.
At the date of approval of these financial statements with the intention to
raise project funding through the issue of corporate copper bonds and with
funds continuing to be received from the exercise of warrants, as well as
their latest assessment of the budgets and forecasts for the business of the
Group for at least 12 months from the date of approval of these financial
statements, the directors believe it appropriate to adopt the going concern
basis of accounting in preparing the financial statements.
3 Basis of preparation
This preliminary information does not comprise full financial statements. The
significant accounting policies and other information contained within this
preliminary announcement has been extracted from the Group's audited financial
statements a copy of which is available on the Company's website:
www.pgmining.com.
The financial information is presented in US dollars.
4 Revenue
The Group is not yet producing revenues from its mineral exploration and
mining activities. The Company charged its subsidiary entities $930,000 (2021:
$885,000) in respect of management services provided.
5 Loss per share 31 December 31 December
2022 2021
$ $
Loss attributable to the parent used in calculating basic and diluted loss per (1,546,827) (942,850)
Share
Number of shares
Weighted average number of shares for the purpose of basic earnings 121,794,101 104,213,499
per share
Weighted average number of shares for the purpose of diluted earnings 121,794,101 104,213,499
per share
Basic loss per share (US cents per share) (1.27) (0.90)
Diluted loss per share (US cents per share) (1.27) (0.90)
Basic earnings per share amounts are calculated by dividing net loss for the
year attributable to ordinary equity holders of the parent by the weighted
average number of ordinary shares outstanding during the year.
Where the Group has incurred a loss in a year the diluted earnings per share
is the same as the basic earnings per share.
The Company has potentially issuable shares of 13,746,457 (2021: 18,602,920)
all of which relate to the potential dilution in respect of warrants and share
options issued by the Company.
6 Property, plant and equipment - mining property Mining
Property
$
At 1 January 2021 14,789,004
Additions 11,335,026
At 31 December 2021 26,124,030
At 1 January 2022 26,124,030
Additions 6,980,200
At 31 December 2022 33,104,230
Net book value
At 1 January 2021 14,789,004
At 31 December 2021 26,124,030
At 31 December 2022 33,104,230
Mining property assets relate to the past producing Empire Mine copper - gold
- silver - zinc project in Idaho, USA. The Empire Mine has not yet recommenced
production and no depreciation has been charged in the statement of
comprehensive income. There has been no impairment charged in any period due
to the early stage in the Group's project to reactivate the mine.
7 Intangible assets
Exploration
and evaluation expenditure
$
At 1 January 2021 276,895
Additions 53,949
At 31 December 2021 330,844
At 1 January 2022 330,844
Additions 16,156
At 31 December 2022 347,000
Exploration and evaluation expenditure relates to the Bighorn and Redcastle
properties on the Idaho Cobalt Belt in Idaho, USA. The Bighorn property is
owned by Salmon Canyon Resources Inc. The Redcastle property is owned by Borah
Resources Inc. Both companies are wholly owned subsidiaries of KPX Holdings
Inc, a wholly owned subsidiary of the parent entity, and each of which are
registered and domiciled in Idaho. The Redcastle property is subject to an
Earn-In Agreement with First Cobalt Idaho, a wholly owned subsidiary of
Electra Battery Materials Corporation of Toronto, Canada.
8 Trade and other receivables
31 December 31 December 2021
2022
$ $
Other receivables 181,072 207,949
Preliminary bond issue expenses 1,110,166 -
Prepaid expenses 243,269 157,829
1,534,507 365,778
There were no receivables that were past due or considered to be impaired.
There is no significant difference between the fair value of the other
receivables and the values stated above. The preliminary bond issue expenses
relate to the corporate copper bonds issue currently underway, and will be
deducted from the proceeds of the bonds and amortised over the expected life
of the bonds.
9 Financial assets
31 December 31 December
2022 2021
$ $
Quoted investments 18,563 56,340
In May 2021 the Group entered into an earn-in agreement with First Cobalt
Idaho, a wholly-owned subsidiary of Toronto-based Electra Battery Materials
Corporation ("Electra"), in respect of the Group's Redcastle cobalt property
on the Idaho Cobalt Belt. The Group received consideration of $50,000 and
11,111 shares (as consolidated) in Electra valued at $56,340, a total initial
consideration of $106,340.
The shares have been valued at market price as at 31 December 2022. A fair
value adjustment of $37,777 has been charged to other operating expenses.
10 Trade and other payables
31 December 31 December 2021
2022
$ $
Trade payables 569,864 862,907
Other payables 2,606 20,289
Accrued interest - -
572,470 883,196
11 Other liabilities
31 December 31 December 2021
2022
$ $
Current liabilities
Deferred consideration 500,000 250,000
500,000 250,000
Non-current liabilities
Deferred consideration - 250,000
In April 2021 the Group entered into an agreement with Mackay LLC to acquire
1% of the 2.5% net smelter royalty payable on mining leases on the Empire Mine
in Idaho, USA. Total consideration payable to Mackay LLC was $800,000, of
which $300,000 has been paid. $250,000 was paid in January 2023 and one
further payment of $250,000 is due on 31 December 2023.
12 Provisions
31 December 31 December 2021
2022
$ $
Decommissioning provision 100,000 100,000
Royalties payable 657,702 657,702
757,702 757,702
There has been no change to provisions in the year ended 31 December 2022.
The provision of $100,000 for decommissioning the Empire Mine is based on the
directors' estimate after taking into account appropriate professional advice.
The other provision of $657,702 arises from a business combination in 2017 and
comprises potential royalties payable in respect of future production at the
Empire Mine. This liability will only be payable if the Empire Mine is
successfully restored to production and will be deducted from the royalties
payable. The amount of the provision will be reassessed as exploration work
continues and also on commencement of commercial production.
13 Share capital
Group and Company Group and Company
Number Number
2022 2021
Number of ordinary shares of no par value
At the beginning of the year 117,415,680 63,306,747
Issued in the year 5,212,942 54,108,933
At the end of the year 122,628,622 117,415,680
The Company does not have an authorised capital and is authorised to issue an
unlimited number of no-par value shares of a single class.
In the year the Company issued 5,212,942 ordinary shares at an average issue
price of $0.27 per share to raise $1.4 million in respect of warrants
exercised. All issued shares were fully paid.
Since the year end the Company has issued a further 50,000 ordinary shares at
$0.22 per share from the exercise of warrants. The Company currently has
122,678,622 ordinary shares in issue.
The ordinary shares in the Company have no par value. All ordinary shares have
equal voting rights in respect of shareholder meetings. All ordinary shares
have equal rights to dividends and the assets of the Company.
The Company has issued warrants to subscribe for additional shares. Each
warrant provides the right to the holder to convert one warrant into one
ordinary share of no-par value at exercise prices ranging from £0.16 to
£0.50. At 31 December 2022 the number of warrants in issue was 7,521,457
(2021: 12,577,920).
The Company has issued options to subscribe for additional shares to the
directors and senior employees of the Group. Each option provides the right to
the holder to subscribe for one ordinary share of no par-value, subject to the
vesting conditions, at exercise prices ranging from £0.17 to £0.50. At 31
December 2022 the number of options in issue was 6,225,000 (2021: 6,025,000).
14 Share-based payments
The Company has issued 7,521,457 (2021: 12,557,920) warrants to subscribe for
additional share capital of the Company. Each warrant entitles the holder to
subscribe for one ordinary equity share in the Company. The right to convert
each warrant is unconditional.
Additionally, the Company has issued 6,225,000 (2021: 6,025,000) share options
to directors and senior employees of the Group. Each share option entitles the
holder to subscribe for one ordinary equity share in the Company once the
vesting conditions have been satisfied.
In the periods presented the Company has settled remuneration liabilities by
the issue of equity in lieu of cash payments for services and has also
operated equity-settled share based incentivisation schemes for employees.
Equity-settled share-based payments are measured at fair-value (excluding the
effect of non-market-based vesting conditions) as determined through use of
the Black-Scholes technique, at the date of issue. The warrants were issued as
exercisable from the date they were issued and there are no further vesting
conditions applicable.
Warrants issued Weighted 31 December 31 December
Average 2022 2021
Exercise price Number Number
At the beginning of the year £0.29 12,577,920 7,589,978
Issued in prior year - average issue price £0.42 6,812,396
Issued in the year £0.35 707,500 -
Issued in the year £0.50 1,570,455 -
Exercised prior year - average exercise price £0.30 (1,541,416)
Exercised in the year - average exercise price £0.30 (5,212,942) -
Lapsed in prior year - average exercise price £0.60 (283,038)
Lapsed in the year - average exercise price £0.42 (2,121,476) -
At the end of the year £0.40 7,521,457 12,577,920
Share options issued Weighted 31 December 31 December
average 2022 2021
Exercise price Number Number
At the beginning of the year £0.34 6,025,000 3,675,000
Issued in the prior year £0.50 - 2,350,000
Issued in the year £0.30 200,000
At the end of the year £0.34 6,225,000 6,025,000
The total share-based payment charge for all warrants and options in the year
was $211,706 of which $67,818 has been charged to profit and loss and $143,888
allocated to Mining Property (2021: $709,040, $191,856 and $517,185
respectively). The share-based payment charge was calculated using the
Black-Scholes model. All warrants issued vest immediately on issue. Share
options vest up to a 36-month period from the date of issue, or on the
achievement of certain vesting milestones.
Volatility for the calculation of the share-based payment charge in respect of
both the warrants and the share options issued was determined by reference to
movements in the Company's quoted share price on AIM.
The inputs into the Black-Scholes model for the warrants and share options
issued were as follows:
31 December 31 December
2022 2022
Warrants issued Share options issued
Weighted average share price at grant date £0.23 £0.23
Weighted average exercise prices £0.45 £0.30
Expected volatility 60.9% 60.9%
Expected life in years 1.00 2.00
Weighted average contractual life in years 1.00 2.00
Risk-free interest rate 2.5% 2.5%
Expected dividend yield - -
Fair-value of warrants and options granted (pence) £0.014 £0.055
The warrants were all issued on 1 September 2022. The share price at the date
of grant was £0.23. The warrant exercise prices at the date of grant were
between £0.35 to £0.50. The share options were issued in one placement on 1
September 2022 with weighted average expected lives of 2.0 years. The share
price at the date of grant was £0.23 and the exercise price was £0.30. The
warrants issued are all exercisable from the date of issue. The number of
outstanding share options are exercisable between £0.30 to £0.50.
The volatility for the warrants issued was 60.9%. The fair-values of warrants
issued or amended in the year ranged from £0.009 to £0.226. The volatility
for the share options was 60.9% and the fair-values of the options issued or
amended ranged from £0.055 to £0.092. The expected life of the outstanding
warrants and options ranged from 1.00 to 2.00 years.
Share-based payments allocation of charge 31 December 31 December
2022 2021
$ $
Arising on the issue and modification of share options 169,843 262,739
On issue of warrants 41,863 446,301
Total charge 211,706 709,040
Allocation:
Mining property 143,888 517,184
Administrative expenses 67,818 191,856
211,706 709,040
The share-based payment charge has been simultaneously credited to retained
deficit.
15 Events after the reporting date
The Company has launched an $80 million corporate copper bond issue which is
in the process of being placed. The bonds will pay a floating rate coupon
subject to a minimum of 8.5% per annum and a maximum of 20%. The floating rate
coupon will be calculated as to the higher of a copper price coupon linked to
the copper price on the London Metal Exchange, or an interest rate coupon
linked to the US Federal Discount Rate. The bonds will be secured on the
Group's patented mining claims, listed on The International Stock Exchange in
the Channel Islands, and will have a ten year life with bondholder option to
request redemption at nominal value after six years and the Company's option
to offer redemption at a 10% premium to nominal value after five years.
M&G Trustee Company will act as Security Trustee and Escrow Agent, and The
Bank of New York Mellon will act as Custodian and Transfer, Paying and
Settlement Agent.
Environmental, Social, and Corporate Governance
Phoenix is committed to meeting and exceeding the environmental standards
required by law as a core value of the Company. The baseline environmental
data collected to date will be used for furthering the permitting process, but
as importantly, will be used as the building blocks for the Company's ongoing
Environmental, Social, and Corporate Governance (ESG) platform, overseen by
the Company's ESG & Sustainability Committee. The Company has also
produces an annual Sustainability Report.
Market Abuse Regulation (MAR) Disclosure
The Company deems the information contained within this announcement to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014, which has been incorporated into UK law by the European
Union (Withdrawal) Act 2018. Upon the publication of this announcement via the
Regulatory Information Service, this inside information is now considered to
be in the public domain.
Contacts
For further information please visit https://phoenixcopperlimited.com
(https://phoenixcopperlimited.com) or contact:
Phoenix Copper Limited Ryan McDermott Tel: +1 208 954 7039
Richard Wilkins Tel: +44 7590 216 657
Brittany Lock Tel: +1 208 794 8033
SP Angel Corporate Finance LLP (Nominated Adviser) David Hignell / Kasia Brzozowska Tel: +44 20 3470 0470
Tavira Financial Limited (Joint Broker) Jonathan Evans / Oliver Stansfield Tel: +44 20 7100 5100
WH Ireland (Joint Broker) Harry Ansell / Katy Mitchell Tel: +44 20 7220 1666
Panmure Gordon (UK) Limited (Joint Broker) John Prior / Hugh Rich / Ailsa Macmaster Tel: +44 20 7886 2500
EAS Advisors (US Corporate Adviser) Matt Bonner / Rogier de la Rambelje Tel: +1 (646) 495-2225
BlytheRay Tim Blythe / Megan Ray Tel: +44 20 7138 3204
(Financial PR)
Notes
Phoenix Copper Limited is a USA focused, base and precious metals emerging
producer and exploration company, initially targeting copper and zinc
production from an open pit mine.
Phoenix's primary operations are focused near Mackay, Idaho in the Alder Creek
mining district, at the 80% owned Empire Mine property, which historically
produced copper at grades of up to 8%, as well as gold, silver, zinc and
tungsten, from an underground mine. Phoenix updated its economic model in
February 2021 to include the processing of all contained metals through a two
phased approach.
Since 2017, Phoenix has conducted extensive drilling programmes to define the
potential of an open-pit heap leach SX-EW mine. In October 2020, a Preliminary
Economic Assessment was completed in accordance with NI 43-101. The 2020 PEA
reports the measured and indicated resource at 22.9 million tonnes at an
average grade of 0.38% copper, 0.324 g/t gold, 10.3 g/t silver, and 0.19%
zinc, with a total of 87,543 tonnes of copper, 238,406 ounces of gold,
7,595,198 ounces of silver, and 43,871 tonnes of zinc.
In addition to Empire, the district includes the historic Horseshoe, White
Knob and Blue Bird Mines, past producers of copper, gold, silver, zinc, lead
and tungsten from underground mines. A new discovery at Red Star, 330 metres
northwest of the Empire Mine proposed open pit, has revealed high grade silver
/ lead sulphide ore, and from three shallow exploration drill holes a maiden
inferred resource of 103,000 tonnes containing 173.4 g/tonne silver, 0.85
g/tonne gold and 3.85% lead (1.6 million ounces silver equivalent) was
reported in an NI 43-101 technical report published in May 2019. Additionally,
the district includes Navarre Creek, a volcanic hosted precious metals target
in a 14.48 sq km area. The Company's total land package at Empire comprises
8,034 acres (32.51 sq kms).
At Empire, it is estimated that less than 1% of the potential ore system has
been explored to date and, accordingly, there is significant opportunity to
increase the resource through phased exploration. The stated aim of the
Company is to fund this phased exploration through free cashflow generated by
its initial mine. A Plan of Operations in respect of the initial open pit mine
was filed with the relevant regulatory authorities in June 2021.
Phoenix also has two wholly owned cobalt properties on the Idaho Cobalt Belt
to the north of Empire. An Earn-In Agreement has been signed with Electra
Battery Materials, Toronto, in respect of one of those properties.
Phoenix is listed on London's AIM (PXC), and trades on New York's OTCQX Market
(PXCLF and PXCLY (ADRs)). More details on the Company, its assets and its
objectives can be found on PXC's website at
https://phoenixcopperlimited.com/ (https://phoenixcopperlimited.com/)
Notes
Phoenix Copper Limited is a USA focused, base and precious metals emerging
producer and exploration company, initially targeting copper and zinc
production from an open pit mine.
Phoenix's primary operations are focused near Mackay, Idaho in the Alder Creek
mining district, at the 80% owned Empire Mine property, which historically
produced copper at grades of up to 8%, as well as gold, silver, zinc and
tungsten, from an underground mine. Phoenix updated its economic model in
February 2021 to include the processing of all contained metals through a two
phased approach.
Since 2017, Phoenix has conducted extensive drilling programmes to define the
potential of an open-pit heap leach SX-EW mine. In October 2020, a Preliminary
Economic Assessment was completed in accordance with NI 43-101. The 2020 PEA
reports the measured and indicated resource at 22.9 million tonnes at an
average grade of 0.38% copper, 0.324 g/t gold, 10.3 g/t silver, and 0.19%
zinc, with a total of 87,543 tonnes of copper, 238,406 ounces of gold,
7,595,198 ounces of silver, and 43,871 tonnes of zinc.
In addition to Empire, the district includes the historic Horseshoe, White
Knob and Blue Bird Mines, past producers of copper, gold, silver, zinc, lead
and tungsten from underground mines. A new discovery at Red Star, 330 metres
northwest of the Empire Mine proposed open pit, has revealed high grade silver
/ lead sulphide ore, and from three shallow exploration drill holes a maiden
inferred resource of 103,000 tonnes containing 173.4 g/tonne silver, 0.85
g/tonne gold and 3.85% lead (1.6 million ounces silver equivalent) was
reported in an NI 43-101 technical report published in May 2019. Additionally,
the district includes Navarre Creek, a volcanic hosted precious metals target
in a 14.48 sq km area. The Company's total land package at Empire comprises
8,034 acres (32.51 sq kms).
At Empire, it is estimated that less than 1% of the potential ore system has
been explored to date and, accordingly, there is significant opportunity to
increase the resource through phased exploration. The stated aim of the
Company is to fund this phased exploration through free cashflow generated by
its initial mine. A Plan of Operations in respect of the initial open pit mine
was filed with the relevant regulatory authorities in June 2021.
Phoenix also has two wholly owned cobalt properties on the Idaho Cobalt Belt
to the north of Empire. An Earn-In Agreement has been signed with Electra
Battery Materials, Toronto, in respect of one of those properties.
Phoenix is listed on London's AIM (PXC), and trades on New York's OTCQX Market
(PXCLF and PXCLY (ADRs)). More details on the Company, its assets and its
objectives can be found on PXC's website at
https://phoenixcopperlimited.com/ (https://phoenixcopperlimited.com/)
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