Axo Metals, until recently named Axo Copper, holds two projects in Mexico. San Antonio, a past-producing, gold and silver focused project in Sonora, is the company’s main asset and the subject of almost this entire conversation. La Huerta, an earlier stage copper project in Jalisco, is the company’s original asset but is currently getting little capital or attention. In this interview, I asked CEO Jonathan Egilo about his background and ownership stake, the long history of San Antonio, current drilling, the company’s cash position, and what’s coming up over the next several months.

TL;DR

Axo has three rigs turning on a fully funded 30,000-metre drill program at San Antonio, with about 85 holes drilled and roughly 50 released at the time of the interview. The notable new development is gold mineralization showing up at Luz del Cobre, an area previously known only for a small, depleted copper mine, including 46.5 metres of 1.44 g/t gold from surface about 750 metres outside the current resource. Management believes this could eventually connect, across an 800-metre gap, with the Sapuchi deposit that already anchors the project, though that link is still being drilled out and isn’t proven yet. The company holds its main environmental permit (received in July) and had about C$23 million in cash at the time of the interview. The PEA, previously expected around the third quarter, has been pushed to early next year so it can incorporate the new drilling rather than come out with a smaller, immediately outdated resource.

What have they done for shareholders lately?

Since closing the all-share acquisition of San Antonio from Osisko Development in January, Axo obtained its main environmental permit (Mexico’s MIA) in July, about six months after applying versus the roughly 12-month timeline it originally gave investors. It has kept three rigs running on the 30,000-metre program, publishing step-out results such as 18 metres of 8 g/t gold in oxide at Sapuchi and 46.5 metres of 1.44 g/t gold from surface at Luz del Cobre, a zone it had not previously drilled for gold. It has also signed new 10-year surface rights agreements (renewable for another 10 years) with the local community and secured a water rights agreement for 350,000 cubic metres a year.

How much money do they have and what are they spending it on?

Axo had about C$23 million in cash at the time of the interview. Its last financing closed in February, a C$40 million bought deal at C$0.70 per share with a half warrant attached, exercisable at C$1.00 for 18 months. Roughly C$5 million of the current cash is earmarked to finish the present drill program, and the next drilling phase is already funded. General and administrative costs run about C$1.5 million a year, plus roughly C$200,000 to C$250,000 a year on institutional and retail investor marketing. Drilling costs about US$200 per metre all in, including assay lab costs. For construction, targeted for the first half of 2027 with production aimed at 2028, management said it plans to fund the relatively modest build mostly with tens of millions of dollars in debt rather than a large equity raise, pointing to the existing infrastructure and permit already in hand.

Upcoming catalysts

Technical: more step-out assay results from the gap zone between Luz del Cobre and Sapuchi, expected in batches of roughly 20 holes about once a month, with the current 30,000-metre program wrapping up around year end or into January or February. Continued infill drilling at Sapuchi is aimed at converting inferred ounces and testing more of the blocks the old resource model treated as waste.

Operational: Mexico’s “change of use of soils” approval, the administrative step still needed alongside the environmental permit already received, is expected before year end.

Corporate: an updated resource estimate and preliminary economic assessment covering the larger, drilled-out project, now targeted for early next year.

Risks

The main near-term risk is that step-out drilling in the Luz del Cobre to Sapuchi gap zone may not confirm the scale management hopes for, though the CEO said they don’t even need that outcome to build the existing oxide project. The outstanding change of use of soils permit still has to come through before year end, and Mexican permitting has previously stalled this same project for years under a different federal administration. Gold price assumptions will shape the cutoff grade and mine plan used in the upcoming PEA. The stock also has a fairly tight, institutionally concentrated share structure, with management estimating 60 to 65 percent held by a small number of funds, which the CEO described as both a tailwind and a headwind for liquidity. And as with any pre-revenue junior miner, the company will still need financing, including debt for the planned 2027 build, and those plans could shift with market conditions.

Axo Metals CEO Interview

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