NGEx Minerals' Lunahuasi Project: High-Grade Copper Potential Ignites Near-Term Value Creation

NGEx Minerals (TSX: NGEX; OTCQX: NGXXF) is rapidly emerging as a compelling story in the copper space, thanks to its flagship Lunahuasi project in Argentina's San Juan Province. Recent drill results have underscored the project's high-grade copper-gold-silver potential, with mineralization extending beyond expectations and positioning the company for a transformative Phase 4 drilling campaign. For investors, these developments signal a pivotal moment: Lunahuasi's expanding resource base and open-pit feasibility could revalue NGEx's stock as its geological model matures.

Drill Results Highlight High-Grade Continuity and Open Potential

The Lunahuasi project's latest Phase 3 drill results, announced in June 2025, reveal a system with remarkable scale and grade. Key intersections include:
- DPDH038: A 16.35m interval grading 12.97% CuEq, including a 6.40m segment at 23.93% CuEq, extending mineralization 30m northward and pushing the strike length to 120m.
- DPDH039: A 108.35m interval at 2.73% CuEq, with a standout 13.00m segment at 9.96% CuEq, demonstrating the deposit's bulk tonnage and high-grade potential across multiple zones.

These results confirm that Lunahuasi is part of a larger porphyry/high-sulphidation epithermal system, with mineralization remaining open in all directions. The project now spans 1.2 km north-south, 1.7 km east-west, and 1.2 km vertically, far exceeding earlier estimates. Such scale and grade are critical for open-pit mining economics, as thick, high-grade intervals reduce stripping ratios and enhance profitability.

Open-Pit Potential and the Case for Near-Term Valuation

The Lunahuasi system's structural controls—northeast-trending, steeply dipping corridors—suggest ideal conditions for open-pit development. At a $3/lb copper price, the current inferred resource of 1.4 billion tonnes grading 0.45% CuEq implies a resource value exceeding $18 billion, yet NGEx's market cap remains CAD 200 million (as of June 2025). This stark gap suggests significant undervaluation.

Crucially, the Phase 3 results have not yet been fully incorporated into resource estimates, as assays for the final eight holes (6,082m) are pending. Once complete, the inferred resource could expand further, bolstering the case for an indicated resource upgrade—a critical milestone for project financing.

Phase 4 Drilling: The Catalyst for Value Realization

The upcoming Phase 4 program, set to begin in October 2025, will target unexplored strike extensions and deeper zones, aiming to convert inferred resources into the higher-confidence indicated category. With the deposit still open in all directions, this drilling could unlock additional high-grade zones and refine the geological model's structural interpretations.

The program's success hinges on testing three key zones identified in Phase 3, as well as isolated intersections suggesting further potential. Positive results could attract joint venture partners or offtake agreements, de-risking the project and accelerating its path to production.

Risks and Considerations

• Commodity Price Volatility: Copper prices remain NGEx's single largest risk, though long-term demand for green energy infrastructure provides a tailwind.
• Permitting and Regulatory Hurdles: Argentina's mining-friendly policies are a plus, but delays could impact timelines.
• Exploration Uncertainty: While Phase 3 results are encouraging, drilling outcomes inherently carry risk.

Investment Thesis: A High-Impact Opportunity

Lunahuasi's 100% ownership and location in Argentina's prolific Vicuña District—a hub for major deposits like First Quantum's Caserones mine—reduce geopolitical and geological risks. For investors, the stock represents a high-risk, high-reward bet on a project with asymmetric upside.

Buy recommendation: Consider accumulating NGEX ahead of Phase 4 results, with a target price reflecting a 50% premium to current levels if the program meets expectations.

Conclusion

NGEx is at a critical inflection point. The Lunahuasi project's high-grade copper potential, open-pit feasibility, and advancing geological model could transform it from a pure exploration play into a resource-defined asset. With Phase 4 drilling imminent and a robust technical team steering the project, investors stand to benefit as NGEx's story transitions from “what if” to “what's next.”

Investors are advised to monitor assay releases from the final Phase 3 holes and Phase 4 drilling updates for further catalysts.