Elysium Resources is about to turn trash into treasure to kickstart its flagship Burraga copper project in New South Wales.

The jewel in the crown at Burraga is the historic Lloyds copper mine and its copper-rich tailings and slag heaps, not to mention the high-grade copper ore near surface and gold, silver, lead and zinc credits.

A 2011 prefeasibility study concluded that reprocessing the tailings, slag and hard rock resources from the surface of the Lloyds mine would require start-up capital of about $A10 million and generate a net profit of $75 million over 4.4 years of operation.

Yet Elysium executive director Max Carling believes the project will become even more compelling as the company completes both a comprehensive NI 43-101 resource statement, due out next month, and an upcoming bankable feasibility study.

"We think we're massively undervalued and Elysium provides a highly-leveraged entry into the copper price," Carling said.

"We have a market cap of $5 million but our prefeasibility study has our NPV - at a 10% discount - around $30 million and importantly, we're revising this into a bankable feasibility study and feeding our drilling results into an upgraded resource estimate to the NI 43-101 standard.

"It's only going to be better, because the work we've been doing has been firming up a lot of those numbers."

Cleaning up the historic tailings and slag will provide a copper recovery greater than 70%, according to metallurgical testwork.

Elysium's initial circuit will process tailings only and include a ball mill, followed by rougher and cleaner flotation and dewatering of the flotation concentrate.

Once all the tailings are processed, the plant will be upgraded to include primary crushing and SAG milling so that the slag material can be processed.

Copper concentrate will be trucked to a nearby rail siding, part of the area's established infrastructure, including power and water that Elysium can tap into.

Elysium will complete its environmental requirements and mining licence application this year to be in production within 18 months, and the project is expected to be self-funding a year later.

The PFS used a copper price higher than the current, but as Carling points out, the drop in the Australian dollar and the anticipated increase in resource confidence will further bolster the project.

He also expects the capital cost of plant and equipment to be significantly lower than forecast, between $6 million to $8 million.

Using March copper prices, Carling said the project would have cash costs of $US1.60 per pound, and with a copper price around $2.67/lb, would generate an estimated profit of $A7 million a year.

Elysium's likelihood of a resource upgrade is strengthening as the latest drilling program at Lloyds continues at the time of going to press.

Drilling in March identified a new high-grade copper shoot under one of the historic slag dumps, with intercepts including 3m at 1.87% copper from 31m.

This is the second shoot of high-grade copper discovered north of the Lloyds deposit and although near-surface, it is below the historic shafts in the area.

Carling said it was an excellent result and gave Elysium a new area for resource definition drilling, of a scale and grade potentially comparable to Lloyds just 500m away.

The company was considering whether to drill the new area in context of the current development program of re-treating the two slag dumps, tailings and mining the Lloyds open pit.

Earlier drilling by Elysium identified a significant intercept of 16m at 1.5% copper from 8m, including 6m at 2.55% copper, and the RC program confirmed a halo of mineralisation remains around the historic workings beyond the area included in the PFS.

The results showed the halo included grades of up to 3% copper around the old underground workings and occasional higher grades in pillars that the previous miners were unable to access.

Lloyds was at one point the largest copper mine in New South Wales and was operated intermittently from 1878 to 1961 by different companies under various names.

While Lloyds is Elysium's key focus, the company has a number of assets waiting backstage, including significant gold potential at two separate projects within its Burraga tenements.

The Lucky Draw gold mine, which produced about 160,000 ounces of gold for Renison Goldfields Consolidated in the early 1990s, contains an inferred resource of 468,000t at 2.1gpt gold.

Nearby Hackney's Creek has an inferred resource of 2.2 million tonnes at 1.4gpt gold.

Elysium also has two low expenditure, high impact targets in Indonesia and Western Australia.

Overseas, Elysium has more gold potential at its Malang project in East Java, where the company is doing low-cost preliminary work with its joint venture partner Gata Sumbar Daya.

Elysium has further exposure to copper through its Horseshoe South project in WA, which is south of Horseshoe Metals' Horseshoe Lights VMS copper-gold project.

Horseshoe Metals is farming into Elysium's Horseshoe South project subject to a minimum exploration requirement.

"That keeps us on the main game, which is the Lloyds copper mine," Carling said.

"We bought the project over five years ago and have done everything we said we'd do in very tough times.

"Now we're on the cusp of development and it's time we started getting noticed as we will be a profitable little operation that will hopefully springboard onto bigger and better things."

Mining giant Anglo American surrounds Elysium's 183sq.km contiguous tenements at Burraga, and Carling thinks Elysium holds the best ground.

Board members have substantial skin in the game showing their faith in the project's merits.

"Unlike any other company on the stock exchange at this end of the spectrum, all the directors hold equity which we paid for, there were no free shares issued," Carling said.

"We think people should be looking at us because we have many points of difference - the directors have put in almost $2 million now and participated in every capital raising which is a vote of support for the company."

Investors have likewise shown support with the company successfully raising $2.7 million in the past 12 months in a tough equities market.

"The company is achieving and doing everything it set out to do," Carling said.

"We're proving up our project and we're progressing as planned. We could be in production within 18 months and that could coincide nicely with a predicted spike in the copper price.

"We could be one of the rare beasts in the junior end which has the cash to continue its development without going back to the market."

He said the company was significantly undervalued, had made a lot of progress with drilling and the resource and was about to become a production story.

*A version of this report, first published in the May-June 2015 edition of RESOURCESTOCKS magazine, was commissioned by Elysium Resources.