Interra Copper Corp. (IMCX:CSE; IMIMF:OTCQB; 3MX:FRA) has entered into a non-binding letter of intent (LOI) with ArcWest Exploration Inc. to negotiate an 80% earn-in and joint venture agreement on ArcWest's Rip Cu-Mo (copper-molybdenum) project in central British Columbia, located in a prolific mining region.
The Rip project comprises 2,309 hectares and is approximately 63 kilometers south of Houston and 79 km southwest of Burns Lake in central British Columbia. It's situated in Stikine Terrane in a prolific belt of Late Cretaceous (Bulkley Plutonic Suite) porphyry copper-molybdenum (Cu-Mo) deposits, which includes Imperial Metals' Huckleberry Mine.
The Catalyst
The terms of the LOI dictate that Interra now has a two-stage option to earn up to 80% ownership interest in the Rip project over an eight-year period. In the first stage, Interra will be able to earn up to a 60% share ownership over a four-year schedule by issuing up to 1,050,000 shares of Interra, completing geological and exploration expenditures of CA$2,000,000, and paying CA$100,000 cash to ArcWest.
The second stage will require Interra to further the project to the Feasibility Study level in order to obtain the remaining 20% within four years of completing the first tier earn-in. The company will need to provide CA$2 million in funding and pay ArcWest CA$250,000 per year.
Interra will have the option to gain possible extensions by continuing the terms listed above, plus an additional CA$100,000 a year.
Interra's director and chief operating officer Jason Nickel said: "The Rip project fits nicely into our portfolio of B.C. copper properties, located in a high-profile jurisdiction, and with nearby infrastructure and past-producing mines. Partnering with ArcWest on the initial work programs and our phase 1 earn-in, we look forward to uncovering what the present anomalies may discover."
Tyler Ruks, president and chief executive officer of ArcWest, added, "ArcWest views the Rip project as containing a highly underexplored porphyry copper system and is looking forward to working with Interra to advance the project."
According to its website, Interra Copper Corp. is a junior exploration company focused on "building shareholder value through the exploration and development of its portfolio of highly prospective/early-stage exploration copper assets located in Chile and Northern British Columbia."
Its portfolio includes three copper projects located in the Central Volcanic Zone, within a prolific Chilean Copper belt: Tres Marias and Zenaida in Antofagasta Region and Pitbull in Tarapaca Region. The company's land package now totals an area of 16,250 hectares. It also owns two exploration projects in Northern British Columbia, Thane and Chuck Creek.
The company's leadership team is made up of senior mining industry executives who have experience in technical and capital markets and "a strong track record of discovering, financing, developing, and operating mining projects on a global scale."
Copper Demand Continues
Reuters reported on September 19 that "stocks of copper registered with the London Metal Exchange (LME) have more than doubled in the space of two months and are now at their highest level since May 2022."
In August, Rick Mills of Ahead Of The Herd reported that copper is now classified as a critical mineral, likely due to its consistent demand as a key component in the construction of renewable energy sources like wind, solar, hydro, and thermal, as well as electric vehicles.
Interra's three projects in Chile are large and prospective for copper porphyry mineralization; Tres Marias, in particular, has three large target areas to be followed up on through drilling.
The company's share structure is tight, with AVC shareholders under a rolling 18-month escrow. It plans to begin its marketing program imminently and will also start its drilling campaign, hoping to add value to Interra shareholders through other initiatives.
Technical Analyst Clive Maund described Interra as "another small speculative copper stock that looks poised to advance soon." He described its "entire history" and "how, after a spike, it went into a severe bear market from April 2020 that took it down to a very low level where a base pattern built out last year."
He went on to say: "There was a flurry of heavy buying about a week ago that drove up the Accumulation line, which is a positive sign, and its moving averages are now in bullish alignment, which makes a breakout soon more likely."
He rated Interra as an "Immediate Speculative Buy."
Ownership and Share Structure
Interra notes that 0.4% is with institutions.
Management owns 2.4 million shares, or roughly 10.7% of the total. Buncic is the largest management shareholder at 3.55%, with 793,356 shares, while board member Rick Gittleman and board advisor Mike Ciricillo own roughly half a million shares each at 2.38%.
Headquartered in Vancouver, British Columbia, Interra Copper Corp. has a market cap of CA$17.5 million. It has 22.5 million shares, 5 million warrants, and 554,000 options.
The company has roughly CA$2.8 million in cash with a monthly burn rate of CA$60,000. Its drill costs are calculated per campaign, with the first phase of the incipient drilling in Chile projected to cost some CA$500,000.
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