Osisko Metals says Gaspé copper drill results better than expected

Osisko Metals (TSX: OM) said initial drilling results at its Gaspé copper project in eastern Quebec topped expectations. Shares jumped.

All five holes drilled in the past three months intersected significant disseminated mineralization within the volume of the company’s 2024 resource, CEO Robert Wares said in a statement Monday. New mineralization was also added at depth well below the base of the 2024 estimate.

Osisko is working to expand the Gaspé copper system’s resource with a view to potentially reopening the former Noranda mine in Murdochville, about 825 km northeast of Montreal. It’s targeting permits and construction by the early 2030s, with initial capital spending estimated at about C$1.8 billion.

“Today’s results advance two of Osisko’s stated goals for the 2025 drill campaign: conversion of its large-scale resource to measured and indicated, and expansion at depth and to the south,” National Bank Financial mining analyst Rabi Nizami said in a note Monday. He calculates an average grade and length of 0.4% copper-equivalent over 109 metres on all mineralized intercepts in Monday’s release.

The project is “a re-emerging Canadian copper asset with scale, infrastructure and a clear path to redevelopment,” he added.

Osisko jumped 6.6% to C$0.41 in early afternoon trading in Toronto. That gave the company a market capitalization of about C$247 million.

2024 model

Four of the five holes were completed drilling within the limits of the 2024 model, Osisko said.

That estimate, released in November, included indicated pit-constrained resources of 824 million tonnes grading 0.27% copper, 0.015% molybdenum and 1.74 grams per tonne silver, and inferred resources of 670 million tonnes grading 0.3% copper, 0.02% molybdenum and 1.37 grams silver.

Drill hole 30-1059 intersected 300 metres grading 0.39% copper and 3.17 grams silver from 8 metres downhole, Osisko said Monday. It’s within the 2024 resource model where there was limited historical data.

Hole 30-1060 intersected 220.5 metres grading 0.29% copper and 2.09 grams silver within the 2024 model, as well as 211 metres grading 0.42% copper and 2.27 grams silver at depth below the 2024 model. Mineralization was extended to a depth of 598 metres.

A fifth target, Hole 30-0947, is a previously un-assayed historical hole. Its drill results yielded five significant intersections, including 82 metres grading 0.31% copper and 2.55 grams of silver from 229-metre depth. This indicates that the deposit is open to the south, Osisko said.

All drill holes were drilled sub-vertically into the Gaspé copper altered calcareous stratigraphy that dips 20 to 25 degrees to the north.

Fully funded

The drilling campaign, which is fully funded, began in February.

“This is an excellent start to the 2025 drill program, and we look forward to a regular flow of results from our 110,000-metre program as we confirm our large existing copper resource, and aim to expand it at depth, to the south and to the west,” Wares said Monday.

Montreal-based Osisko acquired full interest in the project in July 2023 from Glencore (LSE: GLEN).

“We expect results from within the pit shell will tighten drill spacing and be helpful in reducing strip and upgrading resources ahead of economic studies, while extensions below the resource and to the south already demonstrate significant expansion potential to be uncovered” through the large-scale drilling campaign,” Nizami said.