ATEX Resources (TSXV:ATX) - Advancing Large-Scale Copper-Gold Project in Chile's Atacama Desert

Sep 14, 2024

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Interview with Ben Pullinger, President & CEO of ATEX Resources Inc.

Our previous interview: https://www.cruxinvestor.com/posts/atex-resources-tsxvatx-rapidly-advancing-new-copper-gold-discovery-5503

Recording date: 12th September 2024

ATEX Resources (TSXV:ATX) is rapidly emerging as a significant player in the copper exploration sector, advancing a potentially world-class copper-gold project in Chile's mineral-rich Atacama region. The company's flagship asset has already demonstrated substantial scale and continues to grow, offering investors exposure to one of the largest undeveloped copper resources globally.

Current inferred resources stand at an impressive 1.5 billion tons at 0.7% copper, with a high-grade component that enhances the project's economic potential. Recent exploration success, particularly in the Phase 4 drilling program, has further bolstered the project's prospects. A new high-grade zone discovered in the final hole of Phase 4, featuring 100 meters at 2% copper equivalent, overlies the main porphyry system and could significantly impact future development scenarios.

ATEX is poised to commence its largest drilling campaign to date with the upcoming Phase 5 program. This extensive drilling effort is expected to double the company's dataset, potentially expanding the resource and increasing confidence in grade and continuity. CEO Ben Pullinger emphasizes the company's exploration efficiency, noting their progress from "geological curiosity" to approaching a top 10 undeveloped copper project in just three to four years.

Metallurgical performance is another strong point, with reported recoveries of 95% for copper and 94% for gold. These high recovery rates bode well for potential future economic viability. Additional large-scale metallurgical testing is underway to further validate these promising results.

ATEX currently owns 49% of the project but has a clear path to 100% ownership with a final payment of $8 million due. This relatively modest payment for full ownership of a potentially world-class asset represents a significant value creation opportunity for shareholders.

The macro environment for copper appears favorable, with demand expected to surge due to global electrification and renewable energy initiatives. This backdrop of rising demand against tightening supply could support higher long-term copper prices, potentially enhancing the economics of projects like ATEX's.

While ATEX has demonstrated strong exploration capabilities, management is open to strategic partnerships to advance the project towards development. This pragmatic approach recognizes the significant capital requirements for large-scale copper projects and could provide a pathway to realizing the asset's full value.

Investors should note that ATEX, as an exploration-stage company, carries risks typical of the junior mining sector. These include exploration risk, potential for dilution, and sensitivity to commodity prices. However, the project's scale, location in a premier mining jurisdiction, and continued exploration success mitigate some of these risks.

ATEX's market capitalization may see significant re-rating as the project advances and derisks. Management draws parallels to other successful copper explorers that have seen substantial value appreciation based on exploration results.

For investors seeking exposure to the copper sector with significant upside potential, ATEX Resources presents a compelling opportunity. The combination of a large-scale project in a top jurisdiction, ongoing exploration success, and favorable copper market fundamentals positions ATEX as an attractive option in the junior mining space. As always, investors should conduct their own due diligence and consider their risk tolerance when evaluating exploration-stage companies.

View ATEX Resources' company profile: https://www.cruxinvestor.com/companies/atex-resources-inc