Shallow Discoveries and New Targets at Leviathan Copper System in Idaho

1. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Barrick Gold Corp.
2. James Guttman wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. 
3.  This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

For additional disclosures, please click here.

Hercules Metals Corp. (BADEF:OTCMKTS; BIG:TSXV) has announced advancements in its exploration efforts at the western Idaho Leviathan porphyry copper system. The company has completed three reverse circulation (RC) drill holes and is actively drilling a fourth, with HER-24-17 reaching a depth of 975 meters in challenging conditions. Highlights of this drilling campaign include the discovery of shallow mineralization, beginning at 72 meters depth in HER-24-20, and a promising magmatic-hydrothermal breccia pipe, representing a new target type for the project.

Three new holes, HER-24-19 through HER-24-21, have successfully expanded the mineralized zone to the southeast. Early biotite alteration associated with the outer potassic shell was observed, with mineralization starting progressively closer to the surface. The mineralization continues to shallow toward an untested copper anomaly at surface to the east. This could indicate further resource potential. Additionally, a separate zone of early biotite alteration encountered in HER-24-08 and HER-24-12 may suggest an undiscovered intrusive center to the north.

HER-24-20 uncovered a compelling magmatic-hydrothermal breccia from 76 meters to 157 meters downhole. This breccia consists of veined clasts of porphyry and wall rock within a chloritic matrix, showing increasing mineralization intensity downward. Furthermore, HER-24-19 and HER-24-21 intersected an enrichment blanket followed by intermediate sulphidation pyrite-chalcopyrite mineralization, which remains open downplunge. HER-23-14, drilled in 2023, was previously thought to mark the system's edge, but new interpretations suggest otherwise. Future drilling is planned to test under HER-23-14 from a new angle to better understand the system's extent.

Legacy Drilling played a crucial role by completing HER-24-17 to the rig's maximum depth. The challenging drilling conditions highlight the project's technical complexities, and further analysis is pending as geochemical and spectral data are processed. The overall mineralized envelope at Leviathan continues to expand. It remains open in multiple directions and RC drilling aims to rapidly evaluate additional targets.

Why Copper?

On October 18, in a video presentation, Jeffrey Christian from CPM Group discussed copper's long-term outlook. Christian emphasized, "The future of copper prices and copper use in general is bright for the next couple of years." He noted that a shift from recession fears to stronger-than-expected economic performance in key markets had driven investor interest in copper. Additionally, the energy transition and electrification were expected to drive demand, though Christian warned of challenges such as government regulations and limited capital for new mining projects. He concluded that while copper prices might fluctuate in the short term, a significant supply deficit could support higher prices by 2025 and beyond.

In an October 25 Mining Weekly report, it was cited that Goldman Sachs had revised its copper price forecast for 2025, increasing it to US$10,160 per ton from US$10,100. This adjustment came after China unveiled a fiscal stimulus package aimed at reviving economic growth. Goldman Sachs stated, "The estimated China GDP boost to prices is significantly larger for metals than for oil and coal largely because of China's dominant share in global metals demand." The bank also highlighted the benefits of equipment upgrades and consumer goods trade-in programs in China.

USA Today, on October 28, reported that copper was trading at US$4.36 per pound, reflecting a 12.03% increase year-to-date. Despite a 0.78% decline from the previous week, copper prices demonstrated resilience amid a complex market environment. The report highlighted factors driving copper demand, such as the clean energy revolution, which relied heavily on copper for electric vehicles (EVs), renewable energy systems, and related infrastructure. Additionally, China's economic activities continued to play a critical role, with fluctuations in its industrial policies directly impacting global copper consumption.

The Catalysts Driving Hercules

According to the company's investor presentation, key catalysts driving Hercules Metals' ongoing exploration success at the Leviathan project include the continuous discovery and expansion of shallow and deep mineralization zones. The presentation outlines plans for systematic drilling to target high-grade porphyry centers and the newly discovered magmatic-hydrothermal breccia pipe. Furthermore, the property's geological setting and recent discoveries suggest substantial growth potential, aligning with the company's strategy of vectoring toward the potassic core of the porphyry system.

Hercules Metals emphasizes the strategic importance of the Leviathan project's location within Idaho, a tier-one mining jurisdiction known for favorable infrastructure and low energy costs. The company's ongoing Phase III exploration program, with a targeted 20,000-meter drilling campaign, aims to uncover additional centers of mineralization and provide greater clarity on the system's scale and grade. As stated in the investor presentation, "Our ability to rapidly test new targets and refine our geological model provides a strong foundation for unlocking the Leviathan system's full potential."

Third-Party Expert Analysis

Jeff Clark from The Gold Advisor discussed Hercules Metals' recent drilling results at the Leviathan porphyry copper system on November 4. He highlighted the significance of intersecting "early biotite alteration," which he described as "a strong geological sign" that mineralization starts progressively closer to the surface.

Clark noted, "The potential big news is still ahead," with assays expected to be released soon. He expressed confidence in the project's potential, stating, "Leviathan shows all the geological signs of someday becoming an economic deposit," and categorized the stock as a "Strong Buy."

Clark also mentioned that the stock was trading near its one-year lows, presenting an "attractive entry point" for investors.

Ownership and Share Structure

According to Refinitiv, 3.97% of Hercules Metals is owned by Institutions. Of those, Jupiter Asset Management Ltd owns the most with 2.76%, Crescat Capital owns 1.07%.

Strategic investor, Barrick Gold Corp., owns 13.26%. 

Management and Insiders hold 4.55%. CEO Chris Paul holds the most with 3.46% and Director Peter Simeon holds 1.07%. 
Hercules Metals has a market cap of US$139.042M and a 52 week range of US$0.4600 - 1.6200.