Biden’s US$2T+ infrastructure plan should support strong copper demand and be a tailwind for Kodiak Copper

The US$2T+ Biden infrastructure plan announced today will be built on copper. The US$2T+ plan includes an additional US$400B of clean energy tax credits which will give US wind and solar energy a huge tailwind in the years ahead. Other parts of the plan support Electric Vehicles (EVs) and rebuilding infrastructure. All of which requires huge amounts of copper.

For example, BHP says that one wind turbine uses 4 tonnes of copper (video link). President Biden announced yesterday that the US will target to deploy 30 GW of offshore wind energy by 2030. This equates to roughly 3,000 wind turbines assuming an average of 10MW per turbine. 3,000 turbines mean 12,000 tonnes of copper (~26 million pounds) would be needed this decade just for new US offshore wind turbines. Now that is a huge amount of copper and potentially a lucrative business for copper miners given copper prices are now at ~US$4/lb.

Copper is on a bull run as the green energy boom takes off


Copper producer’s stock prices are reflecting the higher copper prices from the past year. However, copper juniors that can grow their resource are not yet reflecting their full stock price potential. This means for investors with a 5-7 year time frame ‘successful’ copper juniors offer much greater reward, and of course greater risk. One junior with enormous upside potential is Kodiak Copper Corp. (TSXV: KDK | OTCQB: KDKCF) (‘Kodiak’).

Kodiak 100% own the MPD copper-gold porphyry property spread over their 9,733-hectare land package in British Columbia, Canada. I introduced Kodiak previously here, so today I will focus on their latest progress and next steps.

Kodiak’s latest drill results

On Feb. 8, 2021 Kodiak announced drill results from five further holes from their exploration program at their MPD copper-gold porphyry project. Following on from past great results with superb long copper-gold mineralization, Kodiak reported 213 m of 0.65% copper and 0.37 g/t Gold (1.00% CuEq) and 171 m of 0.62% Copper and 0.43 g/t Gold (1.03% CuEq), as well as other results.

Claudia Tornquist, President and CEO of Kodiak, stated: “Once again, the Gate Zone has yielded impressive copper-gold numbers over significant widths. With only a small number of holes drilled so far, we have already intersected the newly discovered high-grade zone at Gate and the surrounding larger mineralized envelope over significant dimensions. Over 90% of this kilometre-long target remains unexplored by Kodiak, with considerable discovery potential yet to be unlocked.”

The key to understand about these drill results is the massive interval lengths as is typical of porphyry systems. This typically allows them to be mined at scale, despite the grades not being as high as some other smaller or underground copper projects.

Kodiak Copper MPD Project – Gate Zone drilling results


Next steps for Kodiak

Kodiak will continue exploring at MPD in 2021 with a fully funded, significantly larger program which includes up to 30,000 meters of drilling in several target areas, as well as further geophysical and geochemical surveying, prospecting and geotechnical studies.

Closing remarks

The green energy boom is only just beginning to take off now and is set to have a superb decade (green energy metals supercycle) as countries all around the world shift from fossil fuels to cleaner renewable energy in order to meet their emissions targets. China and Europe will continue to lead, but with Biden in power, the US will start a rapid catch-up beginning today with the US$2T+ US$400B infrastructure plan (assumes Congress passes it). Copper prices have been surging over the past 6 months as the market identifies the strong demand drivers and limited available new copper supply.

For investors looking for a potentially higher risk/higher reward copper play it is hard to go past Kodiak Copper. Management is top tier with a track record of success. Kodiak has enormous potential as they continue to explore both their copper-gold porphyry MPD Property as well as their two other promising projects (The Mohave Copper-Molybdenum-Silver Porphyry Project in Arizona USA and the Kahuna Diamond Project in Canada).

On a market cap of just C$59M for 3 quality exploration projects in safe locations, investors would be wise to take a look again at Kodiak Copper Corp..

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One response

  1. Frank Sterle Jr. Avatar
    Frank Sterle Jr.

    Biden’s infrastructure plan should also include mass solar energy harvestation. For one thing, it may no longer be prudent to have every structure’s entire electricity supply relying on external power lines that are susceptible to being crippled by unforeseen events, including storms of unprecedented magnitude (many Texans may now be realizing this). There also are coronal mass ejections to consider, however rare, in which power grids are vulnerable to potentially extensive damage and long-lasting power outages.

    Each building having its own solar-cell-panel power storage system — at least as an emergency/backup source of power — makes sense.

    But if solar-panel universality would come at the profit-margin expense of the traditional energy production companies, one can expect obstacles, including the political and regulatory sort. If it notably conflicts with corporate big-profit interests, even very progressive motions are greatly resisted, often enough successfully.

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