Kodiak Copper Corp. (KDK) Earnings Call Transcript & Summary

Hey, everyone. Welcome into another daily editorial here in the KE Report. We are getting another company update, this time from Kodiak Copper, traded on the TSX Venture Exchange under the symbol KDK and on the OTCQB under the symbol KDKCF. We are chatting with the President and CEO, Claudia Tornquist. Now Kodiak Copper is really focused on the MPD project. It's a copper-gold porphyry project in South Central British Columbia. The company just released news at tail end of last week, on Friday, June 10, updating everybody on the ongoing exploration program at the MPD project. Now this program consists of about 25,000 meters of drilling, started in March with 1 drill rig. Now that's up to 2 drill rigs. I understand the initial focus has been on the Gate Zone, which was a discovery from 2020.

Claudia, take us through how far you guys are along in this exploration program for this year, please.

Yes. Happy to do so. We have been very busy drilling. We started, as you said, in March and have now 2 drill rigs going at full blast. We have so far drilled at the Gate Zone, our discovery that we made in 2020, and last year had a lot of success expanding significantly. And this year, we have drilled at the northern tip of the Gate Zone where we're getting close to the Prime Zone, which is another historically drilled area. And we've built between those 2 areas and have had some interesting, good-looking porphyry rocks with sulfides in our core, so very promising. And then the second rig is working at the southern end of the Gate Zone. And we've drilled down to 875 meters there, so a little bit deeper than in the past. And also, again, intersected highly prospective porphyry mineralization, porphyry host rocks, can see sulfides. And so yes, I'm looking forward to those results. And we'll be able to release the first results. We'll get them back from the lab, and we'll be able to release them by the end of June.

Well, Claudia, it will be exciting to follow along with some of this drilling that you're doing around the Gate Zone. But just to remind people, you also have a new parallel anomaly to the Gate Zone. It's kind of a lookalike, and it's an IP anomaly. So walk people through again why you're excited about this target.

Well, that's a very interesting target that came out of some IP work and IP survey that we did last year in autumn and received the results this year. We did that survey over the Gate Zone. And we found that there was a very close correlation between the geophysical response and the high-grade drill results. So where we see high conductivity, that correlates with where we see high grades in drill core. And that, of course, makes this geophysical data a fantastic targeting tool. In the course of that survey, we then also found or saw for the first time this second anomaly, which is 600 meters to the southeast of Gate. Very much a lookalike. It's also a large, almost a kilometer in length, conductor zone just like the Gate Zone is. And that, of course, is now also a high-priority drill target, and we will test it this year.

Can we also get some more information on this Dillard target, too? I know that there have been a couple holes that have been drilled into this by you as well as a few historic holes. But give us some more information on Dillard, the potential size and scale that you could see here.

Yes. Dillard, I'm very excited about and very anxious to drill further. It's a very large target, the surface anomaly. So copper on surface is 2.7 kilometers in length. That's approximately almost 3x the length of the Gate Zone, so really big target. It has historic drilling, just like the Gate Zone has, shallow with some interesting values. And last year, we drilled 2 holes there. Those were our last 2 holes of the program last year, and we received those results back and released them a month or so ago. And they're very promising. We intersected mineralization down to 565 meters, so over 0.5 kilometer. So we know the mineralization extends at depth. And we also got already some high-grade intersects in those initial drill holes. So very promising start. Definitely more work to do there. And we will be going back there in summer. We are actually, just as we speak, doing the same IP survey over the Dillard area and also the Man area that worked so well at Gate. We -- actually, when we got those results from Gate, we commissioned the same survey over the other target areas the day after. That's ongoing at the moment, and we will be getting -- start getting those results very soon. And once we have those IP results, that will help us with the targeting at Dillard, and then we'll get drilling there in the summer.

Well, Claudia, one more target that I just have to ask you about because I'm personally interested in it, and I think your exploration team is as well, and that is to the south near the Axe target. There's that 1516 Zone, kind of a new target for the team. Are you going to drill that later this year? You've talked about, I think, potentially a third drill rig. So I'm hoping one finds its way down to the south.

Yes, most definitely. The Axe property, and in particular the 1516 target, is also on the list for this year. That's probably going to be the second half of the year, later in the year. It's an exciting target in that it's a very similar setting as the Gate Zone. The Gate Zone is in a break in the regional magnetic trend. And if you follow that trend south, then the next break is just where this 1516 Zone is. And similar to Gate, we have a big on-surface copper and other metals anomaly. And it has barely been drilled, 1516. I think there are 2 -- or was it 4, like a very small number of holes closed decades ago and very shallow. So it's a very interesting target, definitely needs testing. And we will be getting there -- planning to get there in the second half of the year.

So Claudia, are there any of these targets that rank highest in your eyes? Any that you are particularly excited about to drill?

Well, it's difficult. We have lots of targets and are testing them all -- or are testing several of them this year. I'm very excited about Dillard just because of the sheer size of it. And I'm also equally excited about the Gate Zone because we only really have tested a small part of the underlying anomaly. And there's still a lot of potential to make the Gate Zone bigger than what it is and intersect more hybrid mineralization there. So yes, Gate is exciting, so is Dillard, but Man, Axe as well. So it will be a busy year, and we're not short of targets, and luckily also, fully funded for all our work. We financed in March before the market really fell out of bed, so are in a good position, have a full treasury and can execute on our strategy.

Well, Claudia, one more thing that maybe just to prepare investors for what kind of drill heads you're expecting. This is known as more of a bulk tonnage-style copper deposit, where you've got long intercepts of still very economic copper grades. But you mentioned there's also some of that higher grade at depth. How many of the holes will really be focused on kind of the longer bulk tonnage mineralization? And are there any that are going deeper to kind of look for some of those high-grade shoots?

Well, what we've seen in our drilling is what is quite typical for porphyries. We see high-grade zones within a much larger, lower-grade envelope. So if you look at our drill results, very often, you see like several hundred meters, 500 up to 700 meters of mineralization. And then in the middle of it is a significantly higher-grade section, I'd say typical for porphyries. And we expect to see more of those. And we need both. You need the higher-grade porphyry centers, and you need the larger volume of lower-grade mineralization to eventually make an economic scenario. So we expect to see more of that. And obviously finding more high-grade porphyry centers at our targets, at Dillard or Man or Axe, that will be also -- that's one of the things we're aiming for, and that will be a big step forward for the project.

Okay. Claudia, thank you for this broad update. Again, we will post a link to that news release below this interview. And nice to hear that you are fully funded for this program with all this exploration drilling, testing a lot of these new targets. It will be interesting to see when we start getting some of these results, and we'll follow up as more news hits the market. If anybody has any follow-up questions, as always, please e-mail us. And full disclosure, Shad is a shareholder of Kodiak Copper. Claudia, we'll have you back on, on the back of some more news. Thank you for the update, and I hope you have a great rest of your week.

Thank you.