''Elmer - If he were a betting man he would say that they would back in. He also said that if they did not have any interest they let companies know fairly quickly''
Since we're all betting men and women here, let's look at the odds.
First of all, I don't know where this idea of Teck walking became a bad thing....We're in the same position they're in.
If Teck bought us out, they would get 100% for 25%. They would then be able to take their time and sell various % blocks to others. Capex would pay for itself.
Now if Teck walked, Copper Fox would keep 100% and just do the same thing.
You really think Ernesto and the other insiders that own 65% of the float are just going to say ''ok, Teck is out we lost our money, oh well'' ? LOL
Seriously, they'll have 4x more to sell to others who see how Highland Valley is profitable, that's the only difference.
Waiting to sell 25% (if Teck just backed in) vs waiting to sell 100%...All I know is that 100% is better than 25%.
You have companies out there / Mitsubishi, willing to pay 900 million for 18% of Peruvian deposits with water issues and no Feasibility study.
So let's look at the odds
Teck backing out:
The odds of that happening are very low but some seem to think we would go down...maybe a knee jerk ''follow the herd mentality'' reaction.
Ok..but how long would that last before the smart money starts buying. The downside seems pretty limited from our current 70 cent share price.
The wake up call is we would own 100% instead of 25%.
The current Feasibility with waste rock included says this mine pit is worth $1.26 and btw that's using 50% of the May 2012 reesource estimate. So please give us some credit for the other Billion tonnes.
Then the EA comes along (imo already a given in our case a given) and we can use 5%. base case NPV = 1.694 Billion. = $4 a share. (again with waste rock and using 50% of the resource estimate.
From this point the potential is massive...
So is that what everybody seems to fear ?
Now that we would officialy own 100%, would Ernesto and David start buying every share ?
Ernesto was already willing to pay 1.35, 1.22, 1.10, 1.12, 1.15, 0.85, 0.79 for the expected 25%...
How about the other interested groups, the ones that are waiting on the side line for Teck to decide (India, Korea, Chia, Japan, etc..)
Or other mining giants that are willing to just dump their projects and leave a country because of teh No 1 issue today , Nationalisation.
Now....
Let's look at the odds of Teck backing in 75% or buying us out.
The odds are high and the upside (from 70 cents) is high.
First I'd like to say that I think buying us out is cheaper than backing in 75%. If they take it all, they can sit on it as long as they want and improve the economics, they aren't force to move it into production, they can slowly improve the economics as they look to sell portions of the mine and stay the operator. Eventually Capex is costing them nothing.
That's what they did with Antamina, they took as much of it as they could and sold 33.75% to BHP, 33.75% to Xstrata and 10% to Mitsubishi. Keeping 22.5% and being the operator.
Back to the odds of backing in. What has Teck done that tells me the odds are high.
Teck has staked 73k hectares last year and renewed teh claims last week (April 2013 was the deadline)
Teck stakes more land 2 weeks ago
Teck asked Xstrata for teh Liard shares..If Teck wasn't interested why would they want them ? Xstrata refused...again why ?
Teck has worked with CUU on Feasibility since 2010
Teck received the Feasibility appendices in Dec 2012, still 4 months later, they have not backed out. Per Elmer, Teck doesn't waste time when they are not interested.
Not only have they not backed out, they're in discussions
Per Teck at the PDAC, they have a long term plan for Northwest BC
The main voting man at Teck, Norman B.Keevil, has said:
''The richness of Schaft Creek's copper grade is ''pretty dramatic'' Dr.Keevil Jr says. Despite the high cost, the development date probably would be earlier if there were power in the area, he adds. However hopes for a new BC Hydro plant near the site so far are just that - hopes''
Well Mr. Keevil can stop hoping now...We're in the queue.
Copper Fox Enters Into Facilities Study Agreement with BC Hydro for Schaft Creek Project
