Midnight Sun

No change here either. MMA is just kind of in "drift" mode as assays take longer than expected and the market gets bored with the story. That doesn't change anything about the fundamental outlook here, but it does leave the market in need of a "catalyst" to reignite interest. That could be either a set of particularly strong drill results, an initial resource calculation at Dumbwa, a deal with First Quantum on the Kazhiba oxides, or even a takeout. I continue to ride a reduced position, which I could easily add to on the right news.

MMA, which used to be so exciting, is now starting to bore people to death. They are tired of hearing about how mineralization in drill core correlates with copper in soils. They are tired of hearing about a 15-kilometre-long soil anomaly in one of the most prolific regions in the world for copper makes Dumbwa one of the best exploration targets out there. They are tired of hearing about how the oxides represent a real cash value backstop given FM's need/desire for the Kazhiba copper oxide ore. They don't know what Mitu is, or why it might matter. What people want are more assays and a deposit that looks like something that is undeniably mineable. I think they'll get that eventually, but they are going to have to wait through the boredom. Judging by share price action around the time of the Indaba Mining conference, I'm guessing the story is resonating with more sophisticated investors while retail is starting to think, "Next..." Remember that just a fraction of the holes that have been drilled at Dumbwa have been assayed and reported, so I'm still giving Kevin Bonnell the benefit of the doubt when he says that this is the second coming of Lumwana. Like TLO, I have cut my MMA position in half as part of my cash raising sweep, but I've done it gradually and methodically and it's not because I don't like the project. MMA is loaded with cash and if its share price continues to lag, I could see a situation whereby First Quantum just buys the whole company and pays for it with stock. FM is a huge company and could easily absorb MMA and its exploration upside optionality at virtually no cost given the value of the 72 million pounds of oxide copper at Kazhiba. Time will tell, but – barring a takeout – MMA will continue its Dumbwa drill program and will eventually announce a deal with FM on the Kazhiba oxides. The more I think about it though, if I were FM, I'd just make a bid for all of MMA. Hmmmmm.

I would have similar comments here as those as I had for TLO in terms of just letting them drill out the Dumbwa mega-target. MMA has 5 rigs running and loads of cash on hand, so my plan is not to react to any individual batch of drill results.

There is potentially 11 kilometres of strike length in play in a corridor that may be on the order of 300 metres wide. This is a massive copper trend. What may be most interesting is the excellent correlation that the company sees between surface soil geochemistry (copper in soils) and the underlying mineralization. MMA is methodically drilling out a huge, near vertically oriented, mineralized shear-zone corridor that contains multiple mineralized parallel shear zones within it.

As a whole, the corridor may be some 300 metres wide — perhaps wider in parts and narrower in others. Mineralized shear zones near the core of the trend typically exhibit higher grades and contain copper-bearing sulphide minerals like bornite, cuprite, and chalcocite, while the shears further from the core are chalcopyrite-dominant. Reducing it to its most basic form, think of it as a meandering river of copper-mineralized material.

MMA hosted an investor call on Wednesday to run through what they're seeing thus far, and probably the key takeaways for me were that: 1) mineralization at Dumbwa is very predictable, and 2) the mineralization starts just 3 metres below a thin soil cover. This explains the good correlation they are seeing between mineralized intercepts and soil geochemistry.

It also has significant implications for just how low-cost mining this deposit could be. A mine here would look like a big channel cut perhaps only 200-300m deep, with steep walls and a very low strip ratio (i.e., you're just scraping off a veneer of dirt, and then mining out the top 200-300m of the "river" of mineralized material within the shear corridor). With a strip ratio this low, even a bulk grade 0.2% Cu would be economic – and MMA thinks the bulk grade could be 0.3-0.5%.

There will be hotter areas and less hot areas, but overall I believe that a coherent bulk tonnage target will emerge here. The company laid out potential tonnage scenarios and every one of them was impressive – with some approaching 2 billion tonnes. In due course, I think this will attract interest from the real miners out there.

They have drilled 88 holes thus far and will be up to 6 rigs in January. The assay labs are backed up – as MMA is making sure that the results they are getting are accurate through a thorough quality control protocol – but visual mineralization is consistent and predictable. It's important to remember that only a handful of holes have been released, but with this kind of deposit, visually, the company can already see what is unfolding at Dumbwa, which is what makes MMA so interesting to me.

The correlation between drilling intercepts and the copper-in-soil anomaly means that MMA has a somewhat mechanical task of just drilling out an absolutely massive trend. Based on what we know today, this trend isn't going to be hard to follow… and in mining predictability is good.

So when will the market really take notice? Hard to say. It seems unimpressed, but I think that the reality of Dumbwa still requires a leap of faith for some, but I don't think it's a huge leap. All you have to do is listen to what the copper-in-soil anomaly is saying in conjunction with the visuals in the drill core.

The model makes sense… a large-scale shear zone with mineralization that is zoned across its width. Eventually, I think the company will cut a deal with First Quantum for the oxides at Kazhiba and that will be the day that a whole new raft of investors will discover MMA for the first time. Meanwhile, Dumbwa has all the ingredients needed to be a monster deposit – so time (i.e., drilling) will tell.

My takeaway is that there is nothing to do but wait and let them drill it out. Tick tock.

MMA released some assays from areas that were previously considered barren at the Kazhiba oxide project due to a driller error in the last program. There are still a lot of assays to come there, but there's no change in my view there. Meanwhile Dumbwa assays must be coming soon and as long as I see decent widths in the 0.50% Cu range, I'm a happy camper. Dumbwa represents a giant corridor of mineralized shear zones and its tonnage could be substantial… as in, billion-tonne-plus range. MMA is hitting Dumbwa hard with multiple drills and a methodical pattern-based definition drilling program that would make any major proud. As long as MMA keeps hitting mineralized shear zones as they progress from south to north (and east to west within the corridor), it's game on. The blue sky case for me here has this entering the billion-dollar-plus market cap club, so fingers crossed.

This is a copper story in Zambia, which is in one of the world's premier copper provinces. There are three legs to the story. The first one is MMA's near-surface copper oxide deposit (Kazhiba) that is a short haul away (~7 km) from First Quantum's copper mining operation at Kansanshi. First Quantum has been mining at Kansanshi for years and has largely depleted the oxide layer on top of that deposit. This is important because First Quantum generates sulphuric acid as a byproduct of its sulphide mining and processing operations at Kansanshi. Historically, the sulphuric acid was sprayed on oxide-copper ore on Kansanshi's heap-leach pads, which neutralized the acid and recovered copper at the same time. An exercise in efficient operations. Now, First Quantum is hungry for more oxide copper ore, and Midnight Sun is drilling out a copper oxide resource on First Quantum's doorstep which, if run through the existing infrastructure at Kansanshi, would dovetail with the existing operation. An oxide resource estimate is expected for MMA's Kazhiba oxide-copper this quarter and a contained resource of even 100 million pounds of copper would represent around half of a billion dollars of near-term revenue, with very little associated capital cost.

The second leg of the MMA story is named Dumbwa, which is one of the most attractive exploration targets in the "Domes Region" of the Zambian Copper Belt. With a surface copper anomaly traced over some 20 kilometres of strike length, Dumbwa is a world-class exploration target and MMA is in the process of methodically testing Dumbwa's potential with multiple drill rigs in real time. Early results have been very encouraging, returning copper grades and widths that are comparable to those found to the west at Barrick's giant Lumwana project. The Dumbwa drill program is being overseen by Dr. Kevin Bonnell, who was responsible for drilling out the expansion of Barrick's Lumwana deposit. Dr. Bonnell is ideally suited for the task, and his endorsement of the Dumbwa project should carry weight with investors given his expertise in the region. Results from this program will roll in on a continuous basis through the end of the year and into 2026. This project represents what people in the industry refer to as a "company maker" and, on success, it represents long-tail upside potential that could take the stock to multiples of current levels. MMA is fully cashed up for the task at hand, with nearly $40 million in its treasury, so stay tuned for updates in the near term as the program progresses.

The third leg of the MMA story is composed of exploration and delineation targets on MMA's lands that are at variable stages of delineation/definition. One of those is called Mitu, where significant mineralization has already been discovered and others are being advanced in parallel. While the story is complete with just the first two legs of the story, this third leg could provide further upside in due course. For a small cap company that most people have never heard of, MMA is very well positioned to make the transition from obscurity to the mainstream, so it's a quality speculation in my books.