Post-Merger Bell Copper Looks North and South

By Peter Caulfield
16 Jun 2008 at 04:12 PM GMT-04:00

VANCOUVER (ResourceInvestor.com) -- Even though it was Father's Day and Vancouver was experiencing a rare sunny and warm spring day, there was a good crowd on hand for the first day of the June 2008 Vancouver Resource Investment Conference, produced by Cambridge House International.

An estimated 5,000 attendees registered in advance for the conference, which is down from the attendance at January's Vancouver Resource Investment Conference, but, according to seasoned exhibitors, about the same as last June's event.

Ellsworth Dickson, who has attended the last six Cambridge House conferences in Vancouver, said the healthy attendance shows there is strong investor interest in junior mining companies.

“The world needs more and more resources and here are the companies that are exploring for them,” Dickson said.

Attendees listened to the many interesting and informative speakers and chatted with the 250-odd exhibitors and perused their promotional literature. One of the companies at the show is Vancouver-based Bell Copper Corp. [TSX-V:BCU], whose motto is “value through production and discovery.”

Bell Copper focuses on copper production, development and exploration in the Americas. The company has a portfolio of development and exploration projects in Mexico, Chile, southwestern U.S. and northwestern British Columbia.

Bell Copper CFO Brian Leeners told Resource Investor, “Generally, the price of commodities should be strong over the foreseeable future should remain strong and we like copper.”

Bell Copper was formed earlier in 2008 as the result of a three-way merger of Bell Resources Corp., Grandcru Resources Corp. and Rogue River Resources Corp., a privately-held company. According to the terms of the merger, Grandcru and Rogue River became wholly-owned subsidiaries of the surviving entity, which became Bell Copper Corp.

Bell Copper is currently carrying out a definitive feasibility study at the La Balsa project, which is located in Michoacan, Mexico. The company expects La Balsa to become a low-cost, high-grade mine.

Leeners said the company's plan is to bring La Balsa into production by the second half of 2009 and thereby generate enough cash to finance further exploration of La Balsa, bring the Granduc Mine, which is located near Stewart, B.C., forward to production and further explore the company's pipeline of copper targets in the U.S. and Chile.

Initial production at La Balsa will come from three deposits with a combined measured and indicated mineral resource of more than 190 million pounds of copper (NI 43-101).

According to Bell Copper, all the necessary infrastructure for a mine has been put in place: A plant for soluble copper production has been purchased; electric power, quoted at $0.08 per Kwh, is available; there is a 14-kilometre road to the major port of Lazaro Cardenas; a rail line borders the property; and a water reservoir is within1 kilometre of the property.

Several thousand miles to the north, the Granduc Mine is a historic copper producer in northwestern B.C. Significant resources (non-compliant NI 43-101) remained in place when the mine was closed in 1984 because of low copper prices. The property produced 420 million pounds of copper across approximately 750 metres strike length.

The historic mine zone is open down-dip and along strike. In the north zone, approximately 3.5 million tonnes at approximately 1.7% copper (non-NI 43-101) was identified when the mine was shut down.

The north zone is open down-dip and along strike. Historical drilling in the north zone has shown thick intervals of high-grade copper mineralization.

Drilling in the south zone in 2005-06 has shown up to 3.92% copper, including 25.5 feet of 2.57% copper and 24.9% of 2.21% copper. Drilling shows a pattern in down-sip and southwest directions of increasing grade and thickness.

The JK zone is a new discovery zone that shows the same mineralization as the historic mine zone and the south zone. JK is open down-dip and along strike.

Bell Copper, which has held the property since 2004, has extended the strike to more than 4 kilometres and is targeting more than 30 million tonnes of copper grading more than 1.8%.

During the 2008 season, Bell Copper plans tunnel rehabilitation and delineation drilling to allow for underground drilling and resource development at Granduc.

Leeners said the main reason Bell Copper has Granduc is because of the extensive infrastructure already in place.

“It's a low capital-cost operation. Even if the price of copper falls, the mine will still be economic,” he said.

Bell Copper has an extensive portfolio of exploration projects in the southwestern U.S. and in Chile: Sombrero, Bronco and Kabba in Arizona (copper-molybdenum porphyry targets); Gryphon Summit in Nevada (copper-moly-gold) and Apacheta in Chile (copper-moly porphyry target).

Leeners explained his exploration philosophy to RI.

“Because most major copper deposits on the surface have all been found, our exploration team looks for buried deposits that are the extensions of trends that are already producing,” he said.

Although Bell Copper's stock has fallen from approximately 80 cents to about 40 cents since the merger, Leeners isn't pushing the panic button.

“We're a value stock and value investors find us,” he said. “They get our story.”