The share price of Australia-listed Firetail Resources skyrocketed 150% on Thursday, as the company unveiled a copper acquisition in Newfoundland, Canada.
Firetail announced it had executed an option agreement for the acquisition of up to 80% of the York Harbour project through a staged earn-in.
Executive chairperson Brett Grosvenor explained that Firetail had started a process a year ago to identify opportunities in the rising copper market.
“Our intention was to find strategic copper assets in world class locations, which would be complementary to our existing portfolio of battery metals projects. We see York Harbour ticking all of these boxes. This acquisition broadens our copper exposure to complement the early-stage copper project we are currently exploring in Peru,” he said.
Located about 180 km from the Green Bay copper project that fellow ASX-listed Firefly Metals is developing, York is a brownfield volcanogenic massive sulphide copper asset that hosts the historic York Harbour copper mine.
Small scale historical underground production between 1898 and 1913 resulted in 100 000 t mined at 3% to 12% copper, 7% zinc and 1 oz/t to 3 oz/t silver.
“The project is an advanced, high-grade, copper-focused opportunity for Firetail to get involved in at just the right time. The previous history of copper mining at the project and a number of existing significant copper/zinc/silver drill hits makes this a ‘walk-up’ project of excellent exploration potential,” commented nonexecutive director Simon Lawson.
Historic drill intercepts were all shallow, high-grade, vary in width and were massive to disseminated base metal sulphides in just the right rocks, he added.
"The previous drilling, limited surface outcrop mapping and historic mining information provides us with the basis of a targeting model to get on-ground and rapidly drill test the extents of existing high-grade copper mineralisation, as well as search for new massive sulphide positions and potentially make new discoveries,” said Lawson.
To acquire the project, Firetail has made a A$100 000 cash payment as an exclusivity fee. It will earn into the project in four stages for A$500 000 in cash and 175-million shares.
The company also announced a placement offer to raise up to A$973 000 through issuing 24.33-million shares at A$0.04 each. Thereafter, it intends undertaking an entitlement offer to raise an additional A$595 622 at the same price.
Firetail’s stock surged 150% to A$0.12 a share on Thursday.