New Discoveries Catalyzing Junior Explorers Looking for Copper, Silver

The world is switching to greener sources of energy, there's no debate over that. And many metals once prized for other uses are now valued for properties that make them important for use in the batteries that power electric vehicles (EVs) and the capture of solar energy to power that transition.

Hercules Metals Corp. (BADEF:OTCMKTS; BIG:TSXV) is focusing on two very important ones: copper and silver. Its 100%-owned Hercules project in Idaho "hosts the newly discovered Leviathan porphyry copper system, the most significant new copper discovery in the United States in recent times," the company noted in a release.

Hercules announced the discovery last year. Just this month, the company changed its name from Hercules Silver Corp. to Hercules Metals Corp. to reflect the expansion.

Such porphyry copper deposits are currently the largest source of copper ore in the world and can be gamechangers for junior explorers.

"Because of their large volume, porphyry orebodies can be economic from copper concentrations as low as 0.15% copper and can have economic amounts of by-products such as molybdenum, silver, and gold," Wikipedia noted.

The Leviathan blind copper porphyry discovery, as it is known, also hosts molybdenum (Mo) and silver (Ag).

After the discovery, Barrick Gold Corp. (ABX:TSX; GOLD:NYSE), one of the world's largest gold producers, invested US$23.4 million in Hercules. After sinking to US$0.055 in October 2022, the stock soared as high as US$1.62, a 2,845% increase, in November of last year. It has settled since that jump and was CA$0.62 on Friday.

Jeff Clark of The Gold Advisor, who recently took over Gwen Preston's The Maven Letter, renaming it Prospector Paydirt, wrote that Hercules' project is "what every geologist hopes to find."

The Catalyst: Sparking a New Electric World

According to Credendo, demand for copper could double by 2035, as EVs use more than three times as much of the red metal as gas-burning cars. New copper production — and investment in exploration — will be needed to fuel the supply of those vehicles in the long term, analysts have said.

"The main drivers are the revival in demand from Chinese manufacturers, the rebound of the global economy, and the boom in investments in green technologies (e.g., renewables and electric vehicles) and in AI technologies," the site reported last month.

The hunt for copper "has been accelerating, as companies involved in all parts of the copper supply chain realize the structural supply deficit facing the copper market," wrote Rick Mills, author of the newsletter Ahead of the Herd.

"They understand the need to find sources — existing mines, expansions, brownfield projects, greenfield projects, etc. — and are making deals to acquire the base metal, which is not only essential to electrification and decarbonization but industry in general," Mills wrote.

Copper climbed above US$10,000 a ton in May on predictions of tighter supplies and rising consumption for use in electric vehicles (EVs) and power grids in the transition to green energy. It was US$8,780 per ton on June 28.

BMI analysts believe copper deficits could grow at an extreme pace over the coming decade as the clean energy revolution takes hold, predicting prices of US$11,500 per ton by 2032.

"In the longer term, we expect the copper market to remain in deficit as the green transition accelerates along with the demand for 'green' metals, including copper," BMI's analysts said, according to Stockhead.

"Based on industry-wide capital intensity data, we calculate that some US$196 billion of investment will be required," a market analysis issued by RFC Ambrian said.

An S&P report called copper "one of the most underappreciated critical minerals."

"Deeper electrification requires wires, and wires are primarily made from copper," the report said.

Silver Also Plays an Important Role

Precious metals like silver also play a major role in the transition. The white metal is the most conductive element in nature and is used to coat electrical contacts in computers, phones, cars, and appliances. It's also an important element in solar technology.

According to the Silver Institute's World Silver Survey, global demand for silver "massively exceeded" supply last year, a deficit that is expected to extend into a fourth consecutive year in 2024.

Mordor Intelligence noted that the white metal is expected to register a compound annual growth rate (CAGR) of more than 5% between 2024 and 2029.

"An increase in the demand for new technological products is expected to help the market expand in the future," Mordor analysts wrote. According to a U.S. Geological Survey report, "27% of the silver produced in the United States was being utilized in electrical and electronic applications."

"Based on industry-wide capital intensity data, we calculate that some US$196 billion of investment will be required," a market analysis issued by RFC Ambrian said.

Chen Lin, author of What is Chen Buying? What is Chen Selling?, told Streetwise Reports recently that he believed 2024 will be a bonanza year for the metal.

"The month of May witnessed a significant milestone as silver prices surpassed the US$32/oz mark, reaching an impressive 11-year high," he said.

"Industry experts suggest that this silver rally is just the beginning, citing minimal technical

resistance between the US$30/oz and US$50/oz price levels," Chen noted. "Based on these observations, I anticipate that silver will surpass the US$50/oz threshold during this cycle and subsequently stabilize within the US$30-US$50/oz range for the foreseeable future."

Helping to fuel the surge will be higher demand for solar panels, not only to power EVs, homes, and gadgets, but to supply the large amount of power needed for advancements in artificial intelligence (AI) applications.

"This potentially historic run of silver presents a compelling opportunity that investors should not overlook," Chen said.

Hercules Metals Corp.

Hercules is currently drilling at its Idaho flagship. Since mobilizing three drill rigs this spring, a total of 3,000 meters of cores have been taken in completed holes and two holes in progress. The first of the assays from the Phase III program are expected by midsummer.

"Despite challenging drilling conditions encountered early on, the company continues to see evidence of a large mineral system," said Hercules Director and Chief Executive Officer Chris Paul. "It maintains a strong cash position of $24 million to execute another 17,000 meters of its planned 20,000-meter drill program and continue testing the system across significant strike length."

The company noted that the drill program is its largest yet and is expected to continue for the rest of the year, testing a multi-kilometer geophysical target area.

"In addition to the ongoing drilling, the company has now completed a more detailed geological map, focused on the exposed Lower Plate (Triassic) rocks in the east of the Property and key lithological and structural controls which will further refine the drill targeting," Hercules said in a release. "Results of the detailed surface mapping will be released in the coming weeks. Geochemical soil and rock sampling of newly acquired claims is currently underway, aimed at identifying additional porphyry centers."

"The goal remains to find the highest-grade core of the system," the company said.

Hercules also said soil sampling at the project returned anomalous silver greater than 5 parts per million (ppm) over 3.5 kilometers and open under cover in both directions, with the largest and highest-grade soil/coincident induced polarization (IP) anomaly at Hercules Ridge/Grade Creek still to be drilled. Silver-in-soil values ranged up to 604 ppm (17.6 ounces/tonne) at the Belmont Zone.

Clark, author of The Gold Advisor and now Prospector Paydirt, had high praise for the project.

"Geologist Quinton Hennigh has taken notice," Clark noted, "and Crescat Capital has invested US$1.1M in the company. As PAYDIRT readers saw on page 122, Quinton's philosophy is to invest only in projects with large-scale potential, and that's exactly what he sees in Hercules."

Private Co. Joining the Ranks: Electrum Copper Corp.

One private company expected to go public before 2025, Electrum Copper Corp., also offers significant exposure to copper, molybdenum, and silver, and could soar if it makes a similar discovery.

It's already a producer, as well. Its Candela Mine in northeast Mexico produces 40 tonnes per month of 85% copper cement and 40 ounces of gold, with plans to grow that to 100 tonnes per month copper cement and 100 ounces gold and add molybdenum production.

The company is continually releasing drilling results from Candela and is working toward a resource estimation in early Q4 and is drilling an IP anomaly that could produce a "blind discovery" of its own, which President and Chief Executive Officer Robert Archer told Streetwise Reports "could be a real game-changer for the company."

"The geology there, everything that we've been seeing to date indicates that is a possibility," he said.

Electrum's latest assay results, released on June 4, showed strong intersections of copper mineralization within the project's open pit and an adjacent "exotic" copper zone. Highlights included 1.08% copper (Cu) over 73.85 meters, including 4.7% Cu over 8.95 meters, 2.79% Cu over 2.75 meters, and 3.33% Cu over 3.95 meters, all in hole BP-24-16.

Other results included 0.84% Cu over 6.65 meters, 0.69% Cu over 8.60 meters 0.70% Cu over 7.25 meters, and 0.60% Cu over 14.25 meters in hole BP-24-17; and 0.98% Cu over 76.10 meters, including 2.10% Cu over 17.95 meters and 4.06% Cu over 6.45 meters, 0.50% Cu over 12.50 meters, and 0.51% Cu over 17.80 meters, also in BP-24-18.

"These recent drill results not only confirmed the continuity of copper mineralization in the 'exotic' copper zone but expanded the already significant mineralization within the breccia pipe," Archer said. "Visually, we continue to see strong copper and molybdenum mineralization in subsequent holes, and we look forward to receiving those assays in due course."

According to Mining.com, anything over 100 meters and 1% copper equivalent or better is considered to be high-grade.

Electrum's other project, Don Indio, also in Mexico, has also given excellent copper grades of 0.51% to 3.23% in field and exploration work, and silver grades or 33 grams per tonne g/t to 143 g/t over 0.4 meters to 6.05 meters.

Two drills are currently operating at Candela's pit, and assays will be reported as received, the company said.

The company said insiders and management own 38.9% or 17.4 million shares. Several institutions also have significant positions: Generation IACP Inc. with 4.9% or 2.175 million shares, Davos Equities LLC with 1.3% or 600,000 shares, and NTG Capital LLC with 0.2% or 100,000 shares.

The company said has 44.78 million shares outstanding and a market cap of US$22.39 million.

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