An interesting comparison of two copper-gold porphyry exploration companies. Our beloved Stavely Minerals (SVY) compared to Magmatic Resources (MAG).
Both companies are exploring in locations that are flat, cleared grazing-cropping land, close to major infrastructure, regional population bases, sealed roads, power and railway corridors.
Over the past year, MAG share price is up 111%, but SVY is down 64%.
Similar Market Capitalisation: MAG ($41.3 million) and SVY ($41.6 million).
MAG is exploring the highly proven Cu-Au porphyry East Lachlan region of NSW at Myall, Wellington North and Parkes prospects. MAG latest success is at Corvette-Kingswood prospect having over 500 metres of visible sulphides identified (assays pending, mid May).
Whereas, SVY is drilling the under-explored Stavely Volcanic Belt in Western Victoria. SVY has a significant strategic land holding (1,500 km2) for its tenements, noted as providing a "First Mover Position" should a major porphyry discovery occur. I assume this helps with Joint Venture partnerships or Take-over pricing premiums being offered down the track.
MAG exploration tenements surround Tier 1 World Class gold-copper mines such as Cadia East Mine, North Parkes Mine, Cowal Mine and Alkanes (Tomingley mine & recent Boda 15 Moz discovery) with the regional endowment of over 85 million ounces of gold and 14 million tonnes of copper.
10th May 2023 MAG presentation
Major exploration activities by Newmont, Fortescue Metals Group (FMG), AngloGold Ashanti, and Alkane Resources in the region is extremely encouraging for elevating MAG's share price given the occurrence of porphyry systems in the province.
In comparison, SVY is targeting a relatively new large scale copper-gold porphyry mineralisation province in Victoria (Stavely Arc). Regional gold mines include Stawell Gold Mine (5 Moz), Fosterville (2.7 Moz, 31 g/t Au) and the historic Ballarat goldfields. However, no major copper mining in the region has occurred until the Stavely Minerals Cayley Lode discovery. SVY believe a multi decade open pit and underground mining operation could be possible, although this is dependant upon future Scoping Study economics.
SVY current total mineral resource estimate is 28.3 Mt at 0.75%Cu and 0.11 g/t Au (JORC compliant) with an upside potential for porphyry discovery at Cayley Lode (current drilling) and Junction/Northern Flexure prospects, plus 19x other regional opportunities including promising mineralisation at S41 prospect (based on aircore drilling).
Overall, MAG is beginning to identify copper-gold bearing mineralisation (at Corvette prospect) which is driving its share price higher. MAG has the benefit of exploring in a proven area where other mining majors are in production and actively exploring for more copper and gold. Thus, more drilling/assaying is required to prove up the resource to JORC compliance status and further capital raises will be required.
In terms of SVY, its share price is significantly under-valued by the stock market at times of increasing global copper demand. Impatience by the stock market for not finding the porphyry in a timely manner is obviously reflected in the $0.128/share valuation. IMHO, the JORC compliant resource base SVY has defined, ultimately values the undeveloped Cu-Au resource at over $2 billion and this is not being reflected in the share price. On a positive note, SVY has higher reported copper-gold grade mineralisation at Cayley Lode which will aid future development prospects for the project. Overall, a significant re-rating for SVY is in order to return the share price back to >$0.35 and then over $1.00 for a porphyry discovery premium!!!!!
SVY Price at posting:
12.8¢ Sentiment: Hold Disclosure: Held
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