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Resource at Arizona Cu Project Expands 54%

Source: Siddharth Rajeev

 

April 12, 2023 (Investorideas.com Newswire) This increase, shown in the updated resource estimate, could extend the project's mine life, noted a Fundamental Research Corp. report.


World Copper Ltd. (WCU:TSX.V; WCUFF:OTCQB) increased the total resource at its Zonia copper oxide porphyry project in Arizona by 54% to 1,030,000,000 pounds, Fundamental Research Corp. analyst Sid Rajeev reported in an April 4 research note.

"Based on the new expanded resource estimate, we believe the upcoming preliminary economic assessment (PEA) should return stronger economics," Rajeev wrote.

Trading at a Discount

The copper explorer and developer is trading at about CA$0.21 per share, a 46% discount to the sector average, noted Rajeev, and is a Buy. In comparison, Fundamental's fair value estimate on World Copper is CA$1.28 per share, implying a significant potential return for investors.

Fundamental recently revised its fair value estimate, the average of its discounted cash flow and comparables valuations, Rajeev wrote. The new figure, CA$1.28 per share, is down from CA$2.28.

Highlights of the Update

Of the 54% increase in Zonia's total resource since the previous estimate in 2017, the Inferred resource grew 272%.

The Measured and Indicated resource, on the other hand, decreased by about 12%. The overall grade dropped as well, from 16% to 0.27%. This suggests opex will be higher as a result.

However, Rajeev wrote, "The positive impact of higher resources more than offsets the negative impact of lower grades."

Next for Zonia

The British Columbia-based mining company intends to conduct a 5,000-meter, 18-hole resource expansion drill program at Zonia once it receives the necessary permits. Given its prospectivity, Zonia Norte is a top-priority target to explore.

A new PEA on Zonia will be done later this year, relayed Rajeev, as the most recent one is from 2018.

Drilling in Chile

As with Zonia, World Copper plans to drill this season at its Escalones project in Chile, to include the East Skarn area.

"Upon completing additional resource expansion drill programs, we believe the company will likely advance to a prefeasibility study in 2024," Rajeev wrote.

Near-Term Catalysts

Given the impending advancement of World Copper's projects in Arizona and Chile this year, investors should watch for drill results from Zonia and Escalones and an updated PEA of Zonia. Each event has the potential to move up the company's stock.

Disclosures:

1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.

2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: World Copper Ltd. Click here for important disclosures about sponsor fees.

3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.

4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for 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. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Disclosures for Fundamental Research Corp., World Copper Ltd., April 4, 2023

The opinions expressed in this report are the true opinions of the analyst about this company and industry. Any "forward looking statements" are our best estimates and opinions based upon information that is publicly available and that we believe to be correct, but we have not independently verified with respect to truth or correctness. There is no guarantee that our forecasts will materialize. Actual results will likely vary. The analyst and Fundamental Research Corp. "FRC" does not own any shares of the subject company, does not make a market or offer shares for sale of the subject company, and does not have any investment banking business with the subject company. Fees were paid by WCU to FRC. The purpose of the fee is to subsidize the high costs of research and monitoring. FRC takes steps to ensure independence including setting fees in advance and utilizing analysts who must abide by CFA Institute Code of Ethics and Standards of Professional Conduct. Additionally, analysts may not trade in any security under coverage. Our full editorial control of all research, timing of release of the reports, and release of liability for negative reports are protected contractually. To further ensure independence, WCU has agreed to a minimum coverage term including an initial report and three updates. Coverage cannot be unilaterally terminated. Distribution procedure: our reports are distributed first to our web-based subscribers on the date shown on this report then made available to delayed access users through various other channels for a limited time.

The distribution of FRC's ratings are as follows: BUY (65%), HOLD (4%), SELL / SUSPEND (31%). To subscribe for real-time access to research, visit https://www.researchfrc.com/website/subscribe/ for subscription options.

This report contains "forward looking" statements. Forward-looking statements regarding the Company and/or stock's performance inherently involve risks and uncertainties that could cause actual results to differ from such forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, continued acceptance of the Company's products/services in the marketplace; acceptance in the marketplace of the Company's new product lines/services; competitive factors; new product/service introductions by others; technological changes; dependence on suppliers; systematic market risks and other risks discussed in the Company's periodic report filings, including interim reports, annual reports, and annual information forms filed with the various securities regulators. By making these forward-looking statements, Fundamental Research Corp. and the analyst/author of this report undertakes no obligation to update these statements for revisions or changes after the date of this report. A report initiating coverage will most often be updated quarterly while a report issuing a rating may have no further or less frequent updates because the subject company is likely to be in earlier stages where nothing material may occur quarter to quarter.

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