CHKKF - Chakana Copper Corp (CHKKF)(PERU:CA) - Revised Option Agreement Significantly Enhances Financial Flexibility

New payment terms. Chakana executed a binding agreement with Condor Resources Inc. to amend the terms of its Soledad purchase option agreement. Instead of making a US$4.425 million final payment on April 23, 2022, Chakana will complete the exercise of the option by either paying US$2.8 million and issuing 9,480,198 shares to Condor by June 23 or making cash and share payments to Condor over a three-year period.Drilling expected to resume in June. In 2022, the company will likely conduct a 10,000-meter exploration drilling program to test 20 new targets. We expect the company’s geophysics program and target ranking to be completed shortly with drilling beginning in June using one rig. Outcomes from exploration drilling will likely determine high priority targets for a future resource drilling program.Expectations for 2023. We anticipate Chakana will drill test 20 new targets, or 500 meters of drilling on each target, in the southern portion of the project area, conduct a 30,000-meter resource drilling program on new discoveries, and to update its mineral resource estimate.Rating is Outperform. We think it is more likely the company will elect to exercise the Soledad option with payments over a three-year period in order to enhance financial flexibility and to ensure funds are better allocated to exploration. Chakana’s exploration and drilling program has exceeded our expectations and we believe the company could more than double the inferred resource within 12 to 24 months. Read More >>