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TSX-V:HANOTC:HANNF
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Hannan Metals has first mover advantage and is a top ten ground holder in Peru

Snapshot

The hugeSan Martin project is a new, basin-scale high-grade copper-silver system in Peru

Hannan Metals Ltd -

Quick facts: Hannan Metals Ltd

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TSX-V:HAN

Price: 0.26 CAD

Market Cap: $23.71 m
  • Early exploration results support model for a major sediment-hosted copper system
  • Early stage yet advanced regional geological understanding
  • Company has a huge footprint over prospective geology

What Hannan Metals does:

Hannan Metals Limited (CVE:HAN) (OTCMKTS:HANNF) has 'first-mover' advantage and a massive land package at a new frontier copper district in Peru, a country, which is the world's second-largest producer of the red metal.

The copper and silver explorer is one of the top ten landholders in the South American country, holding 2,154  square kilometres (sq km) of granted concessions and applications.

In November 2020, Hannan struck a landmark deal with Japanese state-owned group  Japan, Oil, Gas and  Metals  National Corp (JOGMEC), which sees the latter able to earn up to a 75% stake in Hannan's  815 sq km San Martin project by spending up to US$35 million to deliver to the joint venture (JV) a feasibility study.

The binding option and joint venture deal granted JOGMEC an initial option to earn 51% of the project by spending US$8 million on exploration over four years. The minimum commitment is to fund US$8 million between April 2020 and March 31, 2022.

It can then earn a further 8% interest for 75% by generating either a feasibility study or funding a further US$15 million in project expenditures. After the US$35 million has been spent, and before a feasibility study, both parties will fund expenditures pro-rata.

If the participating interest of either firm is diluted to less than 5%, it will automatically be converted to a 2% net smelter royalty (NSR), and the other party may at any time purchase 1% of the 2% NSR for cash of US$1 million.

So in summary, Hannan is exploring 815 sq km at the San Martin joint venture area prospective for copper and silver, while, in its own right, it is exploring 277 sq km of mining concessions prospective for copper-silver and in its own right in the San Martin area (called the San Martin Hannan project), and 1,062 sq km of mining concessions prospective for copper-gold called Previsto.

Hannan also owns 100% of the County Clare zinc-lead-silver project in the Republic of Ireland, which consists of nine prospecting licenses for 35,444 hectares.

How is it doing:

In April 2021, Hannan said its joint venture partner JOGMEC had confirmed that it will provide US$2 million from April this year to March, 2022 to advance the San Martin project.

JOGMEC will provide the cash to advance the JV project as part of the "second base earn-in period".

The funds will be used in three different ways. Firstly, to identify the most prospective zones within the large land position by completing the regional scale stream sediment sampling and large-scale LiDAR airborne surveys

Secondly, prospecting will be undertaken in areas of interest with regional mapping along creeks and extensive soil sampling, with real-time portable XRF analysis. Thirdly, the company plans to complete environmental permitting over three separate areas during the year to set the joint venture up with large-scale and multiple drill targets for 2022.

Meanwhile, Hannan said its teams continue to work undertaking reconnaissance prospecting and soil sampling at both the Tabalosos project at the San Martin JV project, and at Hannan's 100% owned Previsto project.

In March 2021, the group reported high-grade channel sample results from the Tabalosos project. High-grade copper-silver outcrops have been delineated in two areas called Zona Este and Zona Sur, which have a combined 2.5 kilometre (km) strike length. Highlight assays from Zona Sur include 6.2 metres (m) at a grade of 0.8% copper and 19 grams per ton (g/t) silver, including 1.3m at 3.5% copper and 86 g/t silver.

At Zona Este, which consists of four channel-sampled outcrops within an area 80m by 120m, the best channel results included 1.8m at a grade of 3.7% copper and 42 g/t silver, including 1.2m at 5.4% copper and 62 g/t silver.

At the Tabalosos copper-silver claim, the company has defined four key zones within a 30 km trend.

In January, 2021 there was also news from the 906 sq km Ucayali project in Peru where work focused on two areas: Previsto and Belen, which are around 20 km apart.

At Previsto, initial reconnaissance fieldwork has identified what Hannan described as a large-scale hydrothermal system within a 6-kilometre by 3-kilometre area that has the potential to host a porphyry mineral system.

Within this area, copper and gold float samples yielded assays including an eye-catching 25.6% copper and 28 g/t silver.

At Belen, a second copper and gold target was identified. The zone was defined by altered outcrops and copper and gold anomalous stream sediment samples, Hannan said.

And last summer, the firm said a new 2 km-long zone of high-grade copper-silver mineralization had been defined by mapping at the Nueva Esperanza prospect within the Sacanche claim at San Martin.

Inflection points:

  • More exploration results
  • Copper/silver price moves

What the boss says:

In the recent statement about the JOGMEC budget for San Martin, Hannan CEO Mike Hudson said: "We are thankful for JOGMEC’s continued support and involvement at the San Martin JV sediment-hosted copper-silver project. We aim to have an active and successful year of continued high-grade copper and silver discoveries over large areas combined with social and environmental permitting advances.

"Equally, I would like to thank our shareholders for their support in bringing additional funds to the company, as we continue to advance our own exploration efforts to find large-scale mineral systems throughout Peru’s frontier areas."

Contact the author at giles@proactiveinvestors.com

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Hannan Metals says field work at Ucayali in Peru has 'absolutely exceeded...

Hannan Metals Limited's (CVE:HAN, OTCPINK:HANNF) Michael Hudson discusses early success from field work at its Ucayali project in Peru. The program focused on two areas - Previsto and Belen, which are around 20 kilometres apart. At Previsto, copper and gold float samples yielded assays including...

on 27/1/21

5 min read