Categories: Mining Stocks
Topics: Copper Stocks

Gunnison Copper (TSX: GCU)(OTC: GCUMF) CFO Craig Hallworth on American Copper Producer into Record Prices

 

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today at a pretty opportune time is Senior Vice President and CFO of Gunnison Copper (TSX: GCU)(OTC: GCUMF), Mr. Craig Hallworth. Craig, record-high gold prices, tariffs. You're in America, you have copper. Pretty darn good time for you to be on. How are you, sir?

Craig Hallworth: I'm great, Gerardo. Thank you so much for having me on the show. And you're right. We're looking at record-high copper prices in the United States, and that's an important differentiation, the United States versus essentially the rest of the world. President Trump has come out yesterday with his strongest backing yet for domestic copper. He's been backing us all along and we've seen the growing stimulative environment in the United States for domestic producers like Gunnison Copper. We have the Johnson Camp Mine that we’re in construction. This mine will be producing in this quarter, that's right. This quarter, by September we're going to be producing finished copper for sale into the domestic supply chains at the Johnson Camp Mine, and it's going to benefit. President Trump yesterday talked about tariffs of 50% on foreign copper. Whether it's 50%, 25% or 10% at the end of the day, all of that extra value is going to accrue to us here at Gunnison Copper. So we're really excited this year.

Gerardo Del Real: I often speak about, especially when I'm speaking with exploration companies about record gold prices, really doesn't matter if you don't capture the sweet spot of the profit curve, and you are in perfect position for that. I saw the recent news, you announced the $5 million financing. I want to talk a bit about your background because I think it plays an important part as to why now and where that 5 million goes.

Craig Hallworth: Yeah. Great. Well, Gunnison Copper, we've been around for a few years. We've got two main assets that I want investors to know about. And Gerardo, we've been touring the country. We've been around the United States. We've been up in Canada the last couple of months really getting the story out because we had a big strategic pivot, and this was back in late Q4 2024, so approximately six months ago. The Gunnison Project, that's our main asset, that's our flagship. It's an open pit. It's 550 million tonnes at 0.35% total copper. It's going to generate about $500 million a year in free cash flow at $5 copper or 350 a year at $4 copper. It's got an 18 year mine life and it's going to produce the finished copper right here in the US. So we're getting the word out about that. Now, if you take a look at our stock chart last five years, you'll see that we pursued this deposit previously.

If you go back to sort of 2018, 2019, 2020 as what's called an in situ leaching mine, which is a different sort of processing approach, ultimately that mine was built and it didn't work out. There was some technical challenges that led to the closure of the mine. And what that did was essentially lead to a big decline in the stock price in 2022 when that mine was closed. And I think that that's exactly where the big value proposition is today, because since then in November of 2024, about six months ago, we secured the final land we needed to pivot it to an open pit. People have been saying, "You have such a great deposit, there's so many open pits in Arizona. You're fully permitted already under in situ. It would be easy just to do permit amendments to an open pit. Why don't you?" And the reason, Gerardo, is that we just didn't have the land.

But in November 2024, we secured that extra land we needed. We rebranded the company to show everyone that this is a new story. This is our strategic pivot. It's now a simple, traditional technology, straightforward open pit. It makes the copper in the United States, the finished product. There's no shipping to Asia, there's none of that stuff. And we're pushing that out to the market, getting investors to hear about this. And if you look at valuations versus other peers with big open pits in the United States, we're lagging. We're way low. We're about a 0.1 price to net asset value at the moment. I think we should probably be about a 0.3. That would be implied a two, three times return on where we are today just to where our comparable peers are. And that's why we're getting the story out.

I was in Calgary, Canada last week and as recently as last week, two investors that I spoke to when I told them about us, the first thing they said was, "Oh, the in situ leaching mine." So it just goes to show that it's been six months and we've been really out there marketing this. But it still takes time. People have long memories and it takes time. And you're seeing that in the stock price. I'll just add one final thing. We've more than doubled the market cap. We're about 10 times the average daily volume that we were prior to the pivot to the open pit. So I think the word’s getting out there.

Gerardo Del Real: Where's the money going to go?

Craig Hallworth: So this $5 million, we weren't looking for money. We raised money back in April, and that money was to fund what's called the high-value work program. We're doing some studies, Gerardo, we think we could probably add about a billion dollars in revenue to the Gunnison Project based on three opportunities that we identified in our PEA study that we released back in December. And keep in mind as a starting point, that PEA shows the project, it's a 1.3 billion NPV, a 21% IRR, and a four-year payback. So it's got great economics as it is, but we think that all of the overburden on top of the ore, it's essentially gravel and limestone, we think that's a saleable byproduct. So we're looking with market consultants on that. How much could we sell per year and how much could we sell it for? In addition to that, we're looking at a method to reduce acid consumption using what's called optical ore sorting technology.

So I think the combination of these two can lead us within the next three months to have excellent catalysts that we'll be able to go to market with that could add something like a billion dollars to the revenue over the life of the mine, reduce our upfront capital costs, and also reduce our operating costs. So that's what we did in April. In addition, in April, we raised enough money to fund our US corporate G&A for 12 months. So we're good until March 2026. But as I said, we've been doing a lot of marketing and investors – there was really high demand. They wanted to take big positions. They said, "Craig, I want to get into the stock now, or I want to add to my already existing position with a big position. When's the next private placement?" And I kept hearing that whether I was in California or New York, Texas, or Canada was, "When's the next private placement? We want to get in."

And so we felt like the time was right this past week, and that's why we launched an additional financing for $5 million. It's going to help us accelerate the work program. So because some of the preliminary results of this high value add program are showing great promise, we're going to spend a little bit of that $5 million extending that program and doing a few more studies that could additionally help to add even more revenue and cut even more cost. And then the second one is the big one in my book. Our overall plan is to advance this to a pre-feasibility study, the Gunnison Copper Project, get this to an open pit reserve, increase the confidence. We're going to get to that reserve level. At the same time I mentioned earlier, we're fully permitted for Gunnison Project as an in situ project. And so we just have to do permit amendments to get it to a permitted open pit.

So we're going to do those permit amendments at the same time and this money is going to help start that. We're going to start spending on long lead items like drilling and metallurgical testing. Right? That's kind of the longest lead items in the whole pre-feasibility study. We're looking to finish this by the end of 2026, so raising that additional 5 million now is going to help us meet that timeline by starting that long lead stuff now. And then finally, as part of the 5 million, that's going to give us enough runway to March 2027 on our US corporate head office so investors can know that we're completely funded and we're very secure, very stable, and all that extra money is going to be able to go into the ground in advancing the project.

Gerardo Del Real: Where's your market cap now roughly? Ballpark it for me.

Craig Hallworth: Yeah, we're about 70, 75 million US, about 100 million Canadian. So we're more than double where we were prior to the pivot to open pit.

Gerardo Del Real: Yeah, still a lot of runway though, Craig.

Craig Hallworth: Yes, I agree with you there, Gerardo.

Gerardo Del Real: Excellent. Listen, thank you so much for your time. Looking forward to getting you back on soon. Appreciate it as always. Thank you sir.

Craig Hallworth: Thank you so much. Have a great day.

Gerardo Del Real: All right.

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