Kutcho Copper Corp. May 15 reported that crews and equipment are being mobilized for the 2018 field program at its Kutcho Copper project in northwestern British Columbia.

"We are excited to get underway on the 2018 field program and are looking forward to the first drill turning in the coming weeks," said Kutcho Copper COO Rob Duncan.

Under its former name, Desert Star Resources Ltd., Kutcho Copper acquired the advanced stage copper exploration project from Capstone Mining Corp. in 2017.

A prefeasibility study prepared for Kutcho Copper at the time of the acquisition outlines a mine at the Kutcho project that would produce 378 million pounds of copper and 473 million lb of zinc, plus by-product gold and silver, over 12 years of production.

The base case estimate of this study generates an after-tax net present value (8 percent discount rate) of C$265 million and an internal rate of return of 27.6 percent using metal prices of US$2.75/lb copper, US$1.10/lb zinc, US$17/oz silver and US$1,250/oz gold.

In preparation for a feasibility study expected to be completed in 2019, this year's program includes additional geotechnical work on the deposits; a drill program to upgrade a portion of the inferred mineral resources to the measured and indicated categories; additional metallurgical test work; and environmental baseline studies.

"This program will supply Kutcho Copper with key data necessary to expand the size of the project and to complete the feasibility study," Duncan said.

Equipment consisting of heavy machinery, site support vehicles, two diamond drill rigs and camp expansion materials are currently being mobilized utilizing overland trail access to the project. Additional materials and fuel are being hauled into site via air transport.

Camp construction and commissioning is anticipated to be completed by June 1, with field work ramping up immediately after.

The 2017 Kutcho Copper pre-feasibility study is based on 10.44 million metric tons of reserves averaging 2.01 percent (463 million lb) copper, 3.19 percent (734 million lb) zinc, 0.37 grams per metric ton (125,000 oz) gold and 34.6 g/t (11.62 million oz) silver.

As part of the study, a detailed review of cut-off grade sensitivities was undertaken that resulted in a cut-off grade of 1 percent copper being selected for reporting mineral resources, compared to 1.5 percent previously contemplated. The lower cut-off grade increases the measured and indicated mineral resource tonnage by 49 percent and the inferred mineral resources tonnage by 432 percent, with corresponding copper equivalent grade reductions of only 13 and 24 percent, respectively.

Due to this adjustment, there is a large portion of resources that can be upgraded to reserves.

In addition to infill drilling, the 2018 drill program will test exploration targets on the Kutcho property.

"The Kutcho project already demonstrates robust economics based on the 2017 prefeasibility study results," said Kutcho Copper President and CEO Vince Sorace. "Through cut-off grade optimization, as well as exploration and infill drilling, our goal is to significantly expand the size of the project and optimize results for the feasibility study."

Kutcho Copper Corp.

Boxes of core from some of the 463 holes drilled at the Kutcho copper project prior to 2017.

–SHANE LASLEY