White Cliff Minerals Limited [ASX:WCN]

High quality copper, uranium, silver and gold projects

We initiate coverage of White Cliff Minerals (ASX: WCN) with a current fair valuation of A$0.034, representing a 76% upside to the current share price of A$0.019. The company has recently acquired two expansive and highly prospective copper, uranium, gold, and silver exploration assets in northwestern Canada. Both project areas encompass multiple mining sites that have historically produced significant quantities of different metals. Additionally, a substantial body of historical exploration data supports the prospectivity of these areas for economically viable multi-metal discoveries. This data gives White Cliff a head start in rapidly defining drill targets and advancing potential resource estimates. The company also has three other exploration projects in Western Australia, including a gold project with already defined inferred resources, providing a solid foundation for rapid resource expansion through further drilling.

Prospective for making big copper and uranium discoveries

The Nunavut Copper-Gold-Silver Project area includes multiple historical highgrade copper mining projects with identified high-grade copper lodes. In WCN’s Radium Point Uranium-Copper-Gold-Silver Project area, significant historical mine production includes 13.7m pounds of uranium oxide (U3O8), 34.3m ounces of refined silver, 11.4m pounds of copper with gold credits, and 127, 227, and 104 tonnes of nickel, cobalt, and lead, respectively. This means both Canadian project areas have proven potential for economical-grade copper discoveries. WCN is planning to start field activities at both projects in Q2 2024 to define future drill targets. Given the very promising early indications, we are very optimistic about the results of any exploration activities across these two projects.

Exposure to a range of commodities with bullish outlooks

White Cliff has exposure to diverse commodities that are the full beneficiaries of the ongoing decarbonisation megatrend. Copper demand is set to soar by EV and AI revolutions, green energy transition, and automation of manufacturing plants while its supply growth is dwindling due to declining grades at the world’s largest mines. Uranium prices are surging due to a rising demand stemming from the construction of more nuclear power plants to reduce carbon emissions, while the supply is limited due to years of underinvestment in uranium mine development owing to low uranium prices. Gold prices could go higher in the medium to long term as interest rates are expected to decline in 2025.

Valuation range of A$0.031–0.036 per share

Our Sum of the Parts valuation methodology based on comparable peers’ current market valuations yields a target price range of A$0.031-0.036 per share using conservative assumptions. WCN is poised to begin its field activities across its promising Canadian projects soon and is awaiting assay results from the latest drilling at its gold project in WA. This could generate substantial news flow over the next few months, potentially leading to re-ratings of WCN. Key risks to our investment thesis include commodity price, funding, and geological risks.