Callinex Mines (TSXV:CNX) - The High-Grade Copper Play in Canada for a Supply-Constrained World

Company Interviews

Interview with Max Porterfield, President & CEO of Callinex Mines Inc.

Our previous interview: https://www.cruxinvestor.com/posts/callinex-mines-tsxvcnx-high-grade-copper-gold-vms-deposits-5234

Recording date: 3rd June 2024

Callinex Mines (TSXV:CNX) is a compelling copper exploration and development company positioned to capitalize on the expected surge in copper demand driven by the global energy transition. With its portfolio of high-grade copper deposits in the established Flin Flon mining district of Manitoba, Canada, Callinex offers investors direct exposure to a crucial metal of the future in a top-tier jurisdiction.

The company's key differentiator is the exceptional grade of its deposits. Callinex recently announced a maiden resource estimate of nearly 6 million tonnes grading 3.0% copper equivalent (CuEq) across its Rainbow and Pine Bay deposits. This includes 3.14% copper (Cu) at Rainbow, or 3.6% CuEq when including gold, silver, and zinc by-products. These grades are substantially higher than the global average for copper mines, translating into potentially lower operating costs and higher margins.

Callinex's assets are also located in close proximity to established infrastructure, including roads, power, water, and a currently idled processing plant. This is expected to significantly reduce the capital intensity of developing the project and accelerate the potential timeline to production. CEO Max Porterfield noted Callinex could commence production via a small-scale, high-grade operation utilizing the existing mill, while retaining the option to permit a larger standalone operation in the future.

The Flin Flon region of Manitoba is a world-class mining jurisdiction with a long history of successful mine development. It offers a stable and supportive political environment, with backing for resource development from the highest levels of government. This reduces the permitting and political risks compared to many copper projects located in less favorable jurisdictions.

Importantly, Callinex also offers substantial exploration upside. The company's planned 2024 drill program will focus on expanding the existing resource base and testing several high-priority targets. This includes stepping out at the recently discovered Alchemist zone, where initial drilling has confirmed the presence of high-grade copper mineralization. Callinex sees the potential to significantly grow its resource in the coming years through a systematic exploration program.

From a market perspective, the outlook for copper is highly favorable. Copper demand is expected to surge in the coming years, driven by the electrification of transportation, the build-out of charging infrastructure, and the growth of renewable energy. At the same time, copper supply is likely to be constrained due to years of underinvestment in new mine development and a scarcity of high-quality new discoveries. This supply-demand imbalance is expected to support strong copper prices and generate robust returns for copper producers.

With its high-grade deposits, favorable location, exploration upside, and leverage to rising copper prices, Callinex represents a compelling investment opportunity in the junior copper space. The company is well-positioned to create value through the drill bit and by advancing its projects towards production in the coming years.

While Callinex is still an early-stage company and carries exploration and development risks, the potential rewards are substantial. With a market capitalization of just C$30 million, the company is trading at a fraction of the value of its larger peers and offers significant upside potential as it grows its resource base and moves down the development path.

In conclusion, Callinex Mines offers a unique combination of high-grade copper resources, a top-tier jurisdiction, and significant exploration upside. As the world shifts towards electrification and the demand for copper accelerates, the company is poised to unlock the value of its assets and deliver strong returns for shareholders. Investors looking for exposure to the copper market should take a close look at this emerging Canadian growth story.

View Callinex Mines' company profile: https://www.cruxinvestor.com/companies/callinex-mines

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