...and let's not forget my favourite (I have been holding for 2 years), Equinox Minerals (EQN.TO), also in Zambia.
Plus points:
* They have begun commissioning their giant Lumwana copper mine, should be fully running by July.
* Mine life is 37 (!) years. Annual production will average 122,000 tonnes (269 million lbs=cashflow $1 billion/year) of copper metal, with over 169,000 tonnes (373 million lbs) being produced per year during the initial 6 year period.
* Will be Africa's biggest copper mine.
* Total Operating Cash Costs expected to be US$0.78 per pound during the initial 6 year period.
* Also, covering this Lumwana pit is some other stuff: uranium. Resource is calculated as ca. 22 million pounds of U3O8. The Uranium Feasibility Study is due THIS MONTH.
* Take-over likely (though the boss doesn't want to sell) by Antofagasta, First Quantum, Zinifex/Oxiana (those 2 are merging now).
* EQN.TO holds 2 other major copper prospects, Malundwe and Chimiwungo, and 25 exploration prospects.
* 564 m shares out. Not a junior anymore but still growing.
Minus points (I can think of only 2...):
* Zambia is about to introduce a new tax regime. Government is pro mining but they know they deserve a more equitable share in their own treasures. After all, this ain't the 1980s anymore. Until the new tax rates are decided & agreed upon, some sense of uncertainty remains (and is exploited by certain parties).
* March/April: Recently, like many other wealthy Australians, Boss Craig Williams got caught up in the crash of Lift, an Australian margin-lending firm. The ANZ bank (which had been providing the cash for Lift's activities) thinks they "own" Lift's clients' securities as collateral -- and since Lift went broke a few weeks ago, ANZ has been selling millions of shares of many Australian securities held by Lift clients. Legal dispute over ownership of these shares is running hot; lawyers in clover. EQN's boss had some 6 million EQN shares as collateral in his Lift account, and although he had not received any margin calls, ANZ decided to cash in their chips and sold, so far, 5 of his 6 million shares. Which, I imagine, put a bit of pressure on the stock price these weeks.
Annual meeting coming up in 2 weeks. By then, the Uranium Feasability Study should be out. And an enormous stream of copper is about to flow.
Disclaimer: EQN remains my largest position. I like it. |
