Element 29 Resources (ECU.V) has been relatively quiet in the past few months as it of course takes a while to drill deep holes on its flagship Elida copper-molybenum-silver project in Peru and wait for the lab to return the assays. But patience is a virtue, and the company released the assay results from three holes late last month (with more to come, obviously).
Not only did the company publish drill results, it also announced it received official approval to double its allowed amount of drill sites at Elida. This will provide additional flexibility and it will allow the technical teams to start drill-testing other high-priority targets.
The next few months will be very busy for Element 29 as the company is completing its 10,000 meter drill program with two drill rigs currently active on the property. Not only does this mean we will see new drill results on a regular basis, it will also allow the company to (hopefully) deliver an updated resource estimate by the end of this year or early next year should the results of the current drill program justify doing so. And given the exploration results that have been published since the previous resource was completed, we anticipate a substantial resource increase (both in terms of tonnage as well as ‘pounds in the ground’), increasing its appeal in a world that’s still hungry for more copper.
Hole ELID035 keeps on giving
Holes ELID042 and ELID043 that were released in July are new and encountered respectively 806 meters of 0.36% copper-equivalent in 042, and three separate areas of mineralization in ELID043 (shown below). But the attention went to hole ELID035. Originally a hole that was completed in 2024, it represented ‘unfinished business’ for Element29, as that hole ended in mineralization at a depth of almost 1,000 meters.
As that hole was initially terminated due to operational reasons, the company re-entered the hole in the current drill season and extended it to 1591 meters, while still ending in mineralization (!). It also is remarkable to see that the final 508 meters of this hole actually saw the grade increase compared to the upper 1,000 meters as the 508 meters returned a copper-equivalent grade of 0.64% (consisting of 0.40% copper, 0.066% molybdenum and 2.42 g/t silver).
Not only do the results of these three holes confirm the continuity of the mineralization at depth, it also confirms mineralization beyond the current inferred resource of 322 million tonnes (containing just under 2.2 billion pounds of copper and about 210 million pounds of molybdenum). The company is just scratching the surface and the current drill program will help to determine whether or not an updated resource calculation makes sense. Should the company’s management pull the trigger on a resource update, we expect late Q4 2026 or early Q1 2027 to be a realistic timing guidance.
These holes are the first holes to be released since hole ELID041 encountered 904 meters of mineralization almost starting at surface. Hole ELID041 was a deep hole, and it returned just under 904 meters of 0.31% copper, 0.02% molybdenum and 2.22 g/t silver, which works out to 0.38% copper-equivalent. This wider interval also includes some higher grade sections like 495 meters of 0.46% copper-equivalent within an interval of almost 708 meters at 0.41% copper-equivalent.
One of the key takeaways from this hole is the fact that it confirms the mineralization extends way beyond the current pit-constrained resource shell. Given the thick layer of mineralization encountered in hole ELID041, the mineralization has now been extended more than 400 meters beyond that resource (which used a 0.2% copper cutoff grade).
Because that’s what this is all about. Element 29’s Elida project is not an early stage grassroots moose pasture exploration project. There is an existing resource estimate at Elida, and the company’s mandate and main task at hand is to expand this resource in order to reach critical mass. On top of that, expect more attention to be spent on metallurgical test work as well, as part of the comprehensive push forward at Elida.
The recently approved 5 year drill permit is an important milestone
The drill results weren’t the only important update from the Element 29 camp. The company also announced it (finally!) received the upgraded PIA (‘Permiso de Inicio de Actividades’) from the relevant Peruvian authorities.
This milestone should not be underestimated, as it allows the company to construct up to 40 drill platforms during the next five year period. This updated PIA replaces the previously approved 20 platform permit, which limited Element 29 to focusing on the Zone 1 mineral resource, as drilling across the entire hydrothermal alteration footprint simply was not possible. The approval for an additional 20 platforms will now effectively solve this issue, as it will allow Element 29 to cast a wider net and drill-test targets outside of Zone 1.
Under the new permitting regulations (published just over two weeks ago), companies can now include up to 60 drill platforms under a PIA, and Element 29 is planning to immediately request approval to further expand its amount of allowed drill sites from 40 to 60. As the map above shows, there are plenty of drill targets for Element 29 to focus on and Zones 1-4 are now located within the permitted PIA area.
That’s important, as there are five porphyry targets and it’s needless to say that even if only one or two additional targets contain mineralization with economic value, the footprint and the appeal of Elida could change drastically.
The company is fully cashed up after a C$35M raise – and another fully committed C$12M raise in the works
While plenty of companies have interesting projects, that’s usually not sufficient. Especially in the case of Elida where Element 29 Resources can hopefully drill out something closer to 1 billion tonnes of mineralized rock (this of course is not an official exploration target provided by the company, but it tends to be a (symbolic) number for porphyry projects in general that makes heads turn), a substantial drill budget will be required.
Fortunately the company has never had any issues raising money, and the April placement as well as the C$12M raise last week once again surpassed expectations due to the very strong support. Back in April, Element 29 Resources issued 32.25M shares at C$1.10 per share for total gross proceeds of C$35.5M, and net proceeds of approximately C$34.8M after taking finders fees into consideration.
In that April raise, Element 29 was able to add Alpayana to its shareholders register, and this new strategic investor acquired a 9.9% interest in the company. Alejandro Gubbins’ investment holding has been quite active lately as Alpayana also acquired positions in Kingfisher Metals (copper and gold in British Columbia) and was the lead for a financing of Pan Global Resources (copper and gold in Spain). And more recently, Alpayana invested C$140M in Magna Mining, so it is definitely good to have them on the shareholder registry. Element 29 also announced Randy Smallwood participated in the April financing which could and should be seen as yet another vote of confidence from people in the industry.
And although the company’s treasury was still flush with cash, it decided to strike the iron while it’s hot and it announced a full-spoken for C$12M raise at C$1.65 per share last week.
With these two impressive no-warrant capital raises, Element 29’s treasury is in an excellent shape (with in excess of C$40M in cash) to continue to expand the currently known resource at its flagship Elida project in Peru. We hope to see additional drill results soon, as we will never get tired of seeing 900-1,400 meter deep holes with continuous mineralization.
Also, keep in mind that Element29 has 19M warrants outstanding of which 13M are due in 2027 (with a C$0.50 exercise price) and 6.3M are due in 2028 (with a C$0.70 exercise price). All these warrants are currently in the money and could bring in an additional C$11M in cash. This could further be increased to in excess of C$11.5M as there are also 1.02M options at C$0.57 expiring in 2027.
Conclusion
Element 29’s share price has more than tripled in the past year, and this is well-deserved. Not only did the copper price maintain its strong performance, Element 29 added value by intersecting more thick layers of mineralization and this bodes very well for the updated resource calculation. With almost 10,000 meters of drilling yet to be reported on it’s too early for some back of the envelope calculations, but we would be surprised if the total resource doesn’t double from the current 322 million tonnes, while a portion of the tonnage should end up in the higher-ranked measured and indicated resources.
As drill results from the 2026 drill campaign roll in, we’ll get a better understanding of the total size of the mineralized envelope and the impact on the resource. But once the 500-600 million tonnes will be reached, this project in the low-Andes will certainly draw attention from the right people.
And with in excess of C$30M in the treasury (and C$11M worth of warrants that are currently in the money and the proceeds of a C$12M financing underway), Element 29’s financial situation has never been as good as it is right now.
Disclosure: The author has a long position in Element 29 Resources. Element 29 Resources is a sponsor of the website. This report is for educational purposes only; be mindful that investing in junior mining stocks is risky, and you may lose your entire investment if things go wrong. Please read our disclaimer.