Titan Minerals (ASX: TTM) has nailed down a whopping US$120 million (AU$187 million) deal with mining giant Hancock Prospecting’s subsidiary Hanrine Ecuadorian Exploration.
It has today been confirmed that Hanrine has committed to spending up big in return for an 80 per cent interest in Titan’s Linderos copper project in Ecuador, underscoring the company’s confidence in the operation’s potential to become a world-class copper play.
Under the terms of the deal, Hanrine will cough up an upfront payment of US$2 million (AU$3.12 million) to earn a 5 per cent chunk, before funding either a 10,000m drilling program or spending at least US$8 million (AU$12.47 million) in the first two years of the agreement to up its share to 30 per cent.
Moving on, Hancock’s Ecuadorian subsidiary will either tip in a further US$12 million (AU$18.7 million) within five years to fund exploration or plunge another 15,000m into the project to earn a 51 per cent piece of the Linderos pie. Upon reaching that milestone, the $57.9 million market-capped Titan will pick up an additional one-off payment of US$1 million (A$1.56 million).
If the results come up trumps and the project moves to a decision to mine, Hanrine is set to invest the full US$120 million over 12 years to earn an 80 per cent stake, with Titan free-carried all the way.
We are very pleased to be partnering with Hancock’s Ecuadorian subsidiary company, Hanrine, who has both the balance sheet and capability to fully explore and develop the Linderos Project. The agreement represents a fantastic endorsement of our belief in the Linderos Project’s potential to host a large-scale copper porphyry system.
Titan Minerals chief executive officer Melanie Leighton
The Linderos project covers 143 square kilometres of prime copper-porphyry hunting ground in southern Ecuador, close to the Peruvian border.
Titan has already etched out multiple copper and gold targets through the underexplored patch, with Copper Ridge and Meseta emerging as early standout prospects. Drilling into its Meseta gold epithermal prospect and Copper Ridge porphyry prospect in 2022, the company returned solid gold-copper results from shallow depths, with both targets open in most directions.
Management believes Copper Ridge has the potential to host higher-grade copper-gold porphyry mineralisation, with a best intercept of 308m at 0.4 per cent copper equivalent including 76m grading 0.5 per cent copper equivalent from 132m, with the hole ending in mineralisation about 500m below the surface.
An induced-polarisation (IP) geophysical survey was completed at the Copper Ridge prospect late last year, with 3D inversion modelling unveiling a much bigger porphyry system than had been previously recognised in surface mapping, geochemistry and drilling.
According to the company, interpretation of the 3D IP inversion model indicates the Copper Ridge porphyry system extends out more than 2km to the Meseta gold prospect, confirming the potential for Copper Ridge to host a much bigger porphyry system.
Linderos is the first of three significant copper projects Titan has assembled in Ecuador’s Andean copper belt, with the Copper Duke and Copper Field projects rounding out the trio.
Ecuador is emerging as a tier-one mining jurisdiction finding favour with a growing list of major mining houses, including Newmont, Anglo American, BHP and Barrick Gold, which are all jostling for major land holdings or joint venture (JV) partnerships to secure exposure to future large-scale copper supply.
The country’s President, Daniel Noboa, sees mining as a “crucial driver” of the economy, benefitting the country through job creation and income for communities. The government has vowed to support the mining industry through fast permitting, low effective tax rates and investment protection treaties – a strategy that effectively removes any roadblocks for mining.
As Ecuador opens its doors and paves the way for mining investment, it will invite its first movers to make the biggest headway to date in the copper-rich country. And backed by the balance sheet of the mining heavyweight that is Hancock, Titan could find itself mingling with the giants as it looks to unlock the value of its underexplored Linderos project.
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