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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers

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To: marcos who wrote (49526)	9/25/2007 5:28:10 PM
From: tyc:>	Read Replies (1) of 78409

>> for them to raise capex purely through equity would have been hugely dilutive ... Pumping Metallica. (a speculation ) There's one stock that is an exception; Metallica. That's because Xstrata is committed to providing 90% of of the capital that MR needs to finance its 30% interest in La Fortuna (to be repaid from MR's share of cash flow). Surely MR's interest will be debt free and unhedged. I have previously mentioned the similarities between Galore Creek and La Fortuna. At Galore Creek, Teck is building a coppermine that will produce 340,000 ounces of gold per annum. If Xstrata opts to build a copper mine with similar gold production, Metallica's share would be 102,000 ounces per annum. Add that to the 90,000 oz of gold expected from their Mexican silver/gold mine, for a total of 192,000 ounces of GOLD per annum.... ignoring silver and copper. Whether Xstrata will require all its capital back before Metallica gets any cash flow, I don't know. This is reminiscent of INMET's interest in Antamina eh ? But that was only a 3% interest.

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