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

Hey, everyone. Welcome into another daily editorial here on the KE Report. We're getting an update from Kodiak Copper, trading 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 focused at the MPD copper-gold porphyry project in South Central, British Columbia. The company has continued to drill out this asset. The Gate Zone, we've talked a lot about. There's also a few other targets, like the Dillard Zone, a new parallel zone to Gate, as well as the Axe Zone, the Man Zone, lot of areas that the company has showed some success with in terms of drilling. And now there's a whole new zone for us to talk about. News release just yesterday, December 5, outlines a new gold-silver zone called the Beyer Zone. This is about 400 meters south of this Man Zone, and it is a gold-silver zone. Now so far, you've done some surface samples and you've also done some trenching. That's what was outlined in this last news release. Claudia, give us some more information on this new Beyer Zone and how the gold-silver component fits into this overall project that is more copper focused.

Yes, that's correct. Right, certainly a very exciting new development, this Beyer Zone discovery. And as I said, it's a precious metals zone, gold and silver predominantly. It's not uncommon to see precious metal zones in big porphyry systems such as the one we have at MPD. In fact, it wasn't a real surprise. But of course, it's out of the box a little bit and a new exciting development because, so far, drilling was porphyry mineralization with gold and with copper, mainly, and some gold byproduct. And now we have found this Beyer Zone, which is a new surface, high-grade gold discovery to add to the fold and an exciting new target to follow up with further work next year.

Well, it is pretty interesting, Claudia, because it's on that same trend with both Gate and Man. But what do you think it means as far as this project? Is the mineralization changing down here and you kind of have a different geology? And then what will the follow-up work beyond it next year?

It's very hard to say at this stage because we only just made the discovery. So what the geology is exactly, we'll certainly do more work next year and see how it fits in. The whole Man area, there has been good gold values in the past from drilling and trenching. So certainly not the first gold discovery there. But what's also very important is that this Beyer Zone is within a large zone, large corridor of gold surface anomalies that came out of our sampling work. We did a very systematic sampling grid over this whole area. And there is this corridor with, like a string of pearls, a number of gold surface anomalies, one of them we trenched. And that's where we made the Beyer discovery. There are others that we'll certainly also have a closer look next year. And at Beyer, we'll also do more work because -- yes, we made a new surface, high-grade gold discovery. And so now we'll do more trenching and drilling probably to see how big it is, where it extends, how it's oriented and how it fits in, in terms of geology with all the other mineralization that we've found on the property.

Okay. So still very early on for this discovery, but let's talk about how this trenching and some of these surface work tied in to the ongoing drill program from this year. It's a 25,000-meter program, but clearly, there is also this other exploration on some other targets. So take us through how this new discovery fit in with the much bigger program.

Well the main effort this year, in terms of budget and in terms of work, as our big drill program, we drilled and just wrapping up and drilled over 25,000 meters. But in addition to that, we also did some regional exploration work such as sampling, geophysics, et cetera. And it's really out of that regional exploration work that this discovery was generated. So really full credit to our exploration team. It's really -- yes, our prospecting and sampling that led to this discovery.

Well, Claudia, I know out of that 25,000 meters, we've talked about some of the drill results that have come back. But there's still quite a bit at the lab, if I remember correctly. Walk us through how many meters there still are to report and what some of the news flow will look like, moving forward.

The majority of the results from this year's drilling are still outstanding. We have reported back on approximately 8,000 meters and have drilled over 25,000. So lots still to come from several targets also. That's very important to keep in mind. We are now taking the approach that brought us the discovery success at the Gate Zone, our first discovery, and are testing several other analogous targets on the properties, such as Dillard, Dillard West, Man, Axe. So very exciting. We started testing other targets, Dillard in particular, this year already. More will be tested next year. And yes, as I said, the majority of the results from this year's drilling are yet to come -- and will come all through the, I would say, quarter 1 of next year. There is a small chance we'll still get some results out this year. Or otherwise, it will be -- the next drill results will be in January, and then -- yes, throughout the first quarter.

So Claudia, can you explain a little bit more? In terms of -- there is still a lot of exploration going on here at a lot of different targets. However, you have put Gate -- or at least the Gate Zone, which was discovered back in 2020. That really has been a bit more of a standout, I guess, with more work done, but there's still a lot of opportunity on this project. So when investors are looking at Kodiak Copper, it's clearly an exploration play. But what can you tell them about eventually focusing on some of these discoveries?

Well, look, we have a strategic choice. We could go and put a resource for the Gate Zone and narrow down our focus, if you will. Or alternatively, we could test the various other targets that have equally as much discovery potential as the Gate Zone first, and really go for size and scale. And it is that strategy that we will pursue and where we will think -- we think we can generate the most value for our shareholders. It's, in many ways, a similar strategy to our sister company, Great Bear, very successful gold discovery by our Chairman, Chris Taylor. And yes, that's our strategy and very exciting at this time and very pivotal time in our drill program as we are taking the model that brought discovery at the Gate Zone and are now applying it to these other targets, and aiming to make one or several more high-grade discoveries. And of course, now with this gold discovery at Beyer, we've just added another target or even a set of targets to our list for drilling next year.

Well, Claudia, I know that you're still waiting on a lot of these assays to come back. But does the exploration team have a favorite pick out of some of these targets between Man and Prime and Dillard and Axe and that 1516 Zone, or that new parallel zone you found to Gate. Is there any that the team is pretty excited to see come back, or is at the top of their batting order?

Well look, we started at Dillard because that's a very large target, so very exciting for that reason. And we'll work our way systematically through the targets on the property. It's a good place to be, to have lots of targets to choose from. And yes, we're planning to drill probably 5 or 6 of those next year, and that should be very exciting.

Now what about cash, Claudia? We always have to ask, cash in the bank, it's critical at this time in these markets for, especially exploration companies. Where does Kodiak Copper stand?

We have, at this stage, after having paid for this year's drill program, still $8 million in the treasury. We financed earlier this year in spring before the market took a turn for the worse. So that puts us in a very good position now. We are well financed into next year. Don't have to worry about going back to the market, like many of our peers do at this stage. So yes, very fortunate to still have $8 million in the treasury. And lots of results, obviously, to come. So a good place to be.

All right, Claudia, I think that brings us up to speed, a new discovery on this MPD project to go along with a number of other zones and discoveries that sounds like will get drilled next year. But there's also a lot of drill core to come back from the assay labs just from this year's program. So we'll follow up as more news hits the market, especially on the drill front side of things. And if anybody wants more information on any of these targets, on any of the drill plans moving forward, please e-mail us, and we're happy to get those addressed for you. Claudia, thank you for this update. Please keep us up to date on future news.

Thank you.