A company we have spent the past months on put a copper deposit on its balance sheet for roughly $15 to $20 per tonne of contained metal, against a copper price of $14,300. Most of the work had already been done by Soviet geologists decades ago and left in an archive. The company then found it could not afford to build the mine, so it kept a slice of each project, contributed no capital at all, and got three separate partners to pay for everything.
Enterprise value of roughly $62m against cash flow of close to $38m a year once both mines are running, meaning three years of production pays for the whole company
Full copper resource acquired for around $15 to $20 per tonne of contained metal, against spot at $14,300
No debt, no dilution to get here, and no capital contribution required to reach production on either project
A gold exploration JV covering an area roughly the size of Italy
Zero equity raised to fund either mine to production, with both partners covering construction in full
One structural risk in the joint venture terms that nobody else has written about, confirmed to us in writing by the chief executive
The real ownership percentage on the second project, which is better than the figure everyone is quoting by around $20m over five years
and more in the 9,000+ word report below.
