Elmer response: CEO's thoughts/opinions
posted on
Oct 29, 2013 12:36PM
CUU own 25% Schaft Creek: proven/probable min. reserves/940.8m tonnes = 0.27% copper, 0.19 g/t gold, 0.018% moly and 1.72 g/t silver containing: 5.6b lbs copper, 5.8m ounces gold, 363.5m lbs moly and 51.7m ounces silver; (Recoverable CuEq 0.46%)
Hello All,
I have pleasantly engaged in communication with Copper Fox's CEO: Elmer Stewart.
First, he is currently in Arizona on business. In respect to that, I presume we will hear news soon regarding the US properties.
Second, I had some important questions I personally wanted answers to so I emailed Greg VP from Teck Resources but he essentially said nothing but to ask your management team but he did say that "drilled is wrapping up". So I tried there and got little.....Next step: Get into Contact with our CEO of Copper Fox which I did.
Elmer's answers to my questions are below in blue writing, enjoy:
1) Is Teck committed to developing this project into production? (Any decision to place the project into production needs to be based on economics. The 2013 program was designed to provide additional information as to possible extensions of mineralization which may be classified as resource on independent review and additional data for pit slope stability studies, both of which would be needed to move the project toward a production decisions)
2) Does Schaft Creek take priority in regards to project development over QB2, Relincho? (That is a question you would need to ask Teck. I do not know much about these two projects but Q2 is the transition from processing oxide copper mineralization to processing sulphide mineralization. Teck recently announced their activities on both these projects)
3) In regards to reputation, what is being said from industrial professionals regarding the economics of Schaft Creek project or the overall conclusions? (Not many industry professionals comment on Schaft Creek. Lots of other people make their comments known. In my opinion the large producers such as Teck know these large projects better than anyone out there and Teck in 2013 is spending a considerable amount of money at Schaft Creek. Can the economics of Schaft Creek be improved that was shown in the FS and that possibility was drilled in 2013)
4) What is the status of the environmental permitting? (That is under the control of Teck. Teck will want to see the results of the 2013 drilling before they determine the size of the operation that would be contemplated in the Environmental Assessment Application and then use that in the permitting process)
5) What is your opinion regarding the evaluation of Schaft Creek in terms of monetary value? The improvement in NPV? Real options Case?Unfortunately I am not allowed to comment on these matters. If you look at comparable transactions for large copper projects (in the past) Schaft Creek is worth more. The current market is very slow which strongly suggests that now is not the time to think of selling our interest in Schaft Creek, after the 2013 results are known and if the valuations pick up, then would most likely be a better time to)
6) In regards to company objectives, will the Copper Fox-Teck joint venture update/revise the resource estimate and BFS to illustrate the improving economics and growing value of this property? (the joint venture would do these activities)
Lastly, Teck has recently completed a 2013 drill program on the deposit. (yes the program is being shut down with camp closure on or about the end of October)
6) How many metres did Teck drill this season in total on the property? ( I would need to get the final numbers from Teck as they are the Operator)
7) Where did Teck drill regarding the drill hole locations? (Paramount zone, Mike zone, Discovery zone) Other zones within the Schaft Creek mineral trend?
8) What are the next steps towards production? further drilling? EA permitting? etc. (2013 results would dictate the next activity to be completed. See comments above on EAA and permitting and pit slope stability studies)
9) What other corporate objectives were completed recently at the Schaft Creek project? (Not sure of the question?)
In conclusion, I now realize my investment is in safe hands with incredible upside potential that one day whether or not it takes months or another 2 years that this will be an explosive stock. I now believe based on my answers above that this should be at least a $2.75/share or more buyout in my opinion. Our management team has so much positive sentiment and confidence in this company's growth and potential that I am not worried about a low-ball offer. Elmer portrays this subjective perception as a reality. Vette was right and on the ball about the deposit being not just big but HUGE. Teck was not just expanding the Paramount East but exploring on multiple mineralized zones this summer! Thats amazing when realizing the potential of the overall picture and upcoming plans Teck/Copper Fox envision. This was the most important drilling season in the company's history and that is something to be proud about. I do not want to brag but I was right when I expressed a thought that management needs to update/revise the resource estimate and BFS: it is happening (so excited). The joint venture will undertake this objective in months to come and make all data/information more relevant and current. This means upkeeping all the documents like the BFS. Why wouldnt you? It is about maximizing your economics and profitability. If we all want top value for our 25% ownership this is the right decision and path to explore. Schaft Creek in my opinion will be one of the biggest mines in the world, and that deserves more than just a premium % buyout to a 50-day moving average stock.
Thank-you