Chakana Copper (TSX-V: PERU) CEO David Kelley on Latest Infill Drilling & Surface Geophysical Results from the Soledad Copper-Gold-Silver Project in Peru

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is the President and CEO of Chakana Copper (TSX-V: PERU)(OTC: CHKKF), Mr. David Kelley. Dave, Happy New Year. How are you?

David Kelley: I'm great, Gerardo. Happy New Year to you as well.

Gerardo Del Real: Thank you so much. I appreciate that. You had some news out recently. Bottom line is more gold, more copper, more silver. Still near surface. It's infill drilling. The headline reads, “Chakana Copper releases results of infill drilling at Breccia Pipe 5 and provides exploration update, intersects 140.4 meters with 0.46% copper, 1.70 grams per tonne gold and 23.5 grams per tonne silver.” Which makes for a 1.77 copper equivalent, and 2.71 gram per tonne gold equivalent from 13 meters.

All good stuff. You're a victim, somewhat of your own success, David, because we've come to expect these results, especially from the infill drilling. But there was also an exploration update that you provided in the news release. And before we get to that, I should commend you for the cross sections and the picture of the core. Other companies would be wise to look at your news releases and really imitate the detail. I think it's important. So kudos to you for that. But let's talk about the results. What do you think?

David Kelley: Thanks, Gerardo. Thanks for the comments on that. We do put a lot of effort into our news releases, just to provide the information that keeps people informed as to what's going on. In the last couple of news releases, we talked about the permitting and the importance of getting access to all the areas to be able to drill. In the meantime, while we're waiting on those approvals, we've launched a very aggressive surface exploration program of detailed mapping, rock sampling, soil sampling and geophysics. You're starting to see the results of that come out.

And we're very excited about it, because that's the exact type of data that one needs to successfully explore a mineral system, like we have at Soledad. It's a very large system. And the latest soil results just confirm that. We have anomalous gold in specific locations spanning about a 2.6 kilometer east-west extent and a 2.2 kilometer north-south extent, where these breccia bodies and occurrences are expressing themselves geochemically. It's a very exciting stage to have all this data in front of us to be able to interpret that.

Gerardo Del Real: For people that may be not as familiar with the story, what are the next steps? You're waiting for the modification of a permit that you recently received, if I understand that correctly? It's the same department that recently approved that permit. Is that correct, Dave?

David Kelley: Yeah, that's right. So it's called an ITS. It's a modification of an existing permit. That existing permit was previously approved, which gave us 120 platforms to drill from. And the modification we're doing expands the work area so that we can get access to drill other breccia pipes, some very high-priority breccia pipes, like the Huancarama Breccia Pipe. It's a very large breccia field. We call it a complex, because it's multiple breccias over a 200-meter strike length by about 100 meters, north-south. And two other pipes, Poloma East and Poloma West, both of which have surface expressions, very strongly anomalous results in gold, a very prominent soil geochemical response. And we're just in the process of doing geophysical surveys over that. So, it's important for us from a standpoint of principles to be able to drill our best targets first. All the work we're doing now will give us the data that we need to prioritize the best targets from number one down the list, and test those targets in that order.

Gerardo Del Real: Excellent. Now, you've been in this space for a while, I've been in this space for a little bit. Everything takes longer than we'd like. But when are you anticipating to get a response on that permit? Obviously, I'm excited as a shareholder for the new drilling. We've gotten accustomed to the great results from the area that you've been able to drill out thus far. But of course, the big potential exists with all the other breccia pipes that you've yet to test, and the new ones that you're discovering. When can we anticipate to possibly see some drills turning?

David Kelley: Yeah, it's a great question and I get asked that a lot. We're hesitant to give out hard deadlines because we've never even been given those deadlines from the government. The government just basically says they'll work on it as diligently as they can. We'll hear the results from them. Our experts anticipate that the process should take no more than four months or so. So we're anticipating April/May as the time when we'll have those approvals in hand. It could happen sooner. We certainly hope that it doesn't take longer.

But we do have two drill rigs on the property. It's not costing us any money to keep the drill rigs on the project at this point. So it's part of keeping our cash cost minimized. But we will be ready with the prioritized targets, with all the surface work done, and the rigs on the property to fire those up just as soon as we can.

Gerardo Del Real: Fantastic. And in the meantime, I'm assuming that we can anticipate more results from the surface work that you're doing right now?

David Kelley: Yeah, that's right. We've put out just a single image in the last news release showing the gold in soil, a 3D image across the entire extent of the known breccia pipe field, and it's a very impressive image. And along with that, of course, are all the other pathfinder elements and other elements one would use to interpret the system and the zoning, that type of aspect. We've got all of that data to work with. And then we're just starting to see the first results from the surface geophysical work that we're doing. It's a time-domain EM survey on specific loops. And the loops are designed to image the geophysical response of individual breccia pipes and occurrences.

We've already gotten some really exciting results from that, that were presented in the news release. The first, of course, is a very robust response right at Breccia Pipe 1, which is what we expected. That's the breccia pipe where we've had some really, really high-grade intercepts that we've released, and we finished the infill drilling on that pipe. That was really kind of our test case.

Then we're now applying that same setup to the other breccia occurrences. And one that really has us excited now, it's a new breccia pipe, it's called Breccia Pipe 7. It's just to the northeast of Breccia Pipe 1. It has a very strong geochemical response, both in rocks and in soils. And now we've confirmed a very strong geophysical response, especially even when you compare it to Breccia Pipe 1, the magnitude of the anomaly is impressive. And we're very excited to be able to drill that in this next round of drilling.

Gerardo Del Real: I'm looking forward to getting out there, and I'm looking forward to seeing those drills turning, Dave. I hope that you'll join me again soon as you get more results from the surface work, and I want to thank you so much for the update.

David Kelley: You bet, Gerardo. Anytime. And we will be consistently putting out news as we have been over the past 18 months. We're excited about where the project is at this point, and we're making really good use of the time in waiting for this expansion of the drilling permit. And we'll be ready to go when that's approved, and I'm sure have some exciting results following that up as well.

Gerardo Del Real: Perfect. Thanks again, Dave. Have a great weekend.

David Kelley: You too, Gerardo. Thank you very much. Happy New Year.