Resource World Magazine

A P R I L / M A Y 2 0 1 6 www.resourceworld.com 25 Diamond drilling on the Fox tungsten property located 70 km northeast of 100 Mile House, south-central Cariboo region, British Columbia. Photo courtesy Happy Creek Minerals Ltd. Persistence pays off for Happy Creek Minerals by Robert Simpson O ver the past decade, happy Creek Minerals [HPY-TSXV] has built an enviable portfolio of mineral exploration projects in British Columbia. The company's eight, early-stage projects include copper, molybdenum, tungsten, gold and silver prospects, which, for the most part, are located in well-known mining districts. Now, after almost 10 years of systematic exploration, it's a matter of finding the right joint venture partner, which, given the company's steady track record, could pay off. Despite a brutal commodity market, the smart money sees this as an opportunity to build their portfolios by making stra- tegic investments and waiting out the markets for their return on investment. Recently, as an example, there has been a marked increase in joint venture and M&A activities, which some analysts are pointing to as the first signs the struggling sector has reached its bottom. Noting the recent rise in the TSX Venture Exchange Composite Index, management at Happy Creek Minerals agrees. "Recently there has been renewed interest in our properties, and we have signed a number of confidentiality agreements with companies and private equity firms interested in discussing joint ventures," says David Blann, President of Happy Creek. Of particular interest, for potential suitors, is the 100%-owned Fox property in the south Cariboo region. The Fox Project is thought to be a significant new tungsten discovery. Tungsten is used to strengthen steel in machine tools and parts, electronics and the military. Chinese mines produce most of the tungsten in the world, while the world's highest grade tungsten mine outside of China is the underground Cantung Mine in Yukon, which has grades around 1.0% tungsten. Very few tungsten mines are open pittable and have grades of over 0.32% tungsten, and that's why when Happy Creek reported tungsten grades near surface averaging 2.5% tungsten, the world's major producers stood up and took notice. If explora- tion results continue to produce favourable tungsten grades, the Fox Project has all the characteristics to be considered world-class. The project is close to infrastructure, including roads, power and a skilled workforce. The tungsten is close to surface – and it's big. So far, surface tungsten mineralization has been mapped over an area 10 by 3 km, and much of the 165 km 2 property still hasn't been explored. Seven distinct targets have been identified and three of the zones discovered span almost 3 km that are con- nected by the same underlying geological strata where high-grade tungsten occurrences have been discovered. "Since our most recent drill results were made public we have been gaining attention from the global private equity groups who understand the tungsten markets," says Blann. The next step for the company is to complete a NI 43-101 complaint resource estimate on the Nightcrawler-Discovery Zone, one of the better understood zones. The report is expected to be made public soon and should give the market additional confidence in the project. More exploration is planned for the Fox property this year, including trenching a new target and beginning some prelimi- nary environmental and mine engineering work. The company has a track record of spending funds fortuitously. More than 60% of all the money raised over the past 10 years has gone back into exploration and last year the administration expenses were a mere 10% of the overall budget. "I am proud of the fact the company started 10 years ago and despite being hammered by the financial crisis we managed to keep the share structure at 72 million shares outstanding and still have almost $600,000 dollars in the treasury," said Blann, who no longer takes a salary from the company. "The goal this year is to raise another $2.5 million dollars through a joint venture agree- ment, and then use most of the money on exploration," he said. While the Fox property is promising, this isn't the only proj- ect of note in the Happy Creek portfolio. There's also an exciting copper project in the Highland Valley Mining Camp. The Rateria and West Valley properties total about 18,000 hectares and adjoin Teck Resources' Highland Valley Copper Mine property, Canada's largest copper producer. Grades at Highland average 0.25-0.32% copper from three different pits (Valley, Lornex and Highmont), and historical drill holes on the Rateria and West Valley property returned 6.0 metres of 0.65% copper, 3.0 metres of 1.85% cop- per, and 18.39 metres of 0.30% copper. Commodity markets will eventually turn around, and when they do, companies like Happy Creek Minerals will be rewarded. n MININg

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