Taranis Resources (TRO-V) thinks it’s about time a junior mining company hit the big time in northern Finland’s world-class Kittila copper-gold district.
The region has already played home to the mining success of bigger boys like Agnico-Eagle Mines (AEM-T, AEM-N), Anglo American (AAL-L) and First Quantum Minerals (FM-T, FQM-L), and the country itself was recently ranked as the second-best mining jurisdiction in the world by the Fraser Institute.
For John Gardiner, Taranis’ CEO, the time is ripe for juniors on Finnish soil. “We’ve been there for over ten years, we were one of the first juniors there,” he says, “and we’ve seen the country go from zero to a hundred miles an hour, in terms of mining over that time.”
So why hasn’t the region seen many big, junior success stories?
Gardiner explains that the country was closed to foreign ownership prior to 2000, which also meant not a single airborne geophysical survey had flown over the country until that point.
“Outokumpu had everything back then,” he says. “It was the exploration arm of the government, but after 1999 it focused mainly on chromite, so it got out of everything, and its exploration properties went back to the government.”
Since then, it’s been a series of fits and starts for the junior industry.
Initially looking to spur on foreign direct investment, the government of Finland turned to the Canadian model. But by the time its policies were in place, markets were hit by the crash of 2008, and investment dried up.
There have since been major changes in the mining law, as the government, frustrated with companies sitting idle on land, screened out laggards by drawing out the drill-permitting process. It used to take two weeks to get a required permit — now, it takes up to three years.
But Gardiner says Taranis has a competitive advantage when dealing with bureaucratic issues by virtue of is first-mover status in the country.
The company’s initial foray came by way of acquiring the Kettukuusikko deposit at a government auction.
It has added to its land position since then, becoming the dominant junior in the same district that holds First Quantum’s new Kevitsa nickel-copper mine (the deposit acquired in the purchase of Scandinavian Minerals for $281 million in 2008), Anglo American’s Sakatti project and Agnico-Eagle’s Kittila gold mine.
Taranis’ 76 sq. km Kittila copper-gold project is located just 10 km southwest of Agnico’s producing gold mine.
And while the prospective land hosts numerous areas of interest, the company’s current flagship is the Naakenavaara property.
Mineralization at Naakenavaara was first discovered by Outokumpu, but when the major found copper grades in the 0.5% range, it deemed it too low grade to bother, and walked away without assaying for gold.
But the company left behind core from 76 holes, and when Taranis had it reassayed for gold, it found that the yellow metal was there, and that the area could be subdivided into two areas of mineralization.
The first is a low-grade, bulk-minable zone that is related to a widespread, flat-lying unit called the black schist that grades 0.5% copper equivalent and averages 20 metres thick.
The second is a higher-grade portion of black schist that occurs along the southeast side of the area where Outokumpu drills were focused, in a zone known as Bull’s Eye. The higher-grade zone is only 2.5 metres on average, but has zones with 2.45% copper equivalent, and could be mined via underground methods.
But while Outokumpu focused on the 2 sq. km Bull’s Eye area, Taranis believes there is potential to expand the lower-grade bulk minable zone over 10 sq. km in the syncline area.
“Historic drilling found copper and gold roughly two kilometres southwest of Bull’s Eye, and along the same stratigraphic contact,” Gardiner says, “but the rest of the syncline has not seen any drilling.”
Taranis has done ground and airborne geophysical studies that show the same horizon extending through the remainder of the syncline. But taking the property to the next level will require significant capital.
Even just moving the Bull’s Eye target into a National Instrument 43-101 compliant measured and indicated resource would require more than another 100 holes in addition to the 38 holes already drilled by Taranis in the area.
“It’s a huge asset in a little company,” Gardiner explains. “A lot of juniors are focused on smaller areas, but we choose to go after the big company-type target.”
Now it needs to fund it. The large amount of capital needed to meet such ambitions outstrips Taranis’ means, so it will either have to form a joint venture with a major, or find a large fund that believes in the project and is willing to invest on a large scale.
While there are other juniors in a similar position, Gardiner feels bolstered by not only the project’s scale, but also its address.
“Finland wants to see a junior succeed,” he says. “They’ve already had Anglo, Agnico and First Quantum succeed, and in five to six months, we’ll be out there drilling and trying to become the next one.”
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