Worth a look at the recent money of mine discussion about red...

Worth a look at the recent money of mine discussion about red flags and other issues to look out for in exploration and mine development investment. One comment on Fridays episode was about scoping studies and the problem where you can't include anything other than proven reserves, so they often markedly under estimate the true worth of a deposit. With consequences for the markets interpretation of the SS. That is probably a significant issue here with both the overall reserve estimate (and hence value) plus the likely value and economics of future underground, which is likely to be significantly more at Gonneville than could be stated in the SS. The other discussions were also around expectations and timelines of developing copper and similar deposits that are typically far more complex than gold mines or dig and ship iron ore or even lithium.

The polymetalic nature of the Chonolith that Chalice seem to have discovered is going to cost heaps to fully map out, take time to turn into a major industrial facility, and will require a lot more drilling to fully prove up. Certainly likely a lot more than perhaps the bulk of retail investors in the market appreciated before the SS. But the big players appreciate that so while some retail is a bit dazed and confused at the moment, its unlikely the big players are. There is no doubt this will be economical going forward (to me at least), and that it will be developed by a major, not Chalice. The big question though is can Chalice do enough drilling to map out a lot more economic basement sulphide traps down dip at Gonneville as well as along the intrusion to the north to recover the SP somewhat before a takeover offer? Maybe, maybe not.

For me, I'd be running a lot more of the 2D seismic they have recently done so well (and validated at Gonneville) to follow and map that intrusive structure along its length, to see where it widens, narrows and plunges, where the heavier nickel sulphide traps may be, and where the deeper deposits might be readily accessed via a decline rather than an open pit if there are good deposits under the state forest, given the complexities of approvals otherwise. Leave the expensive additional infilling drilling at Gonneville (needed for the PFS stage) and the metallurgical wizardry to the inevitable major who buys this thing, who will have the deeper pockets and vastly greater technical know how around polymetallic deposit development.