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Gold/Mining/Energy : Copper Fox

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To: ElephantAnalytics who wrote (9063)

1/5/2015 10:03:53 PM

From: explorationguy

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I hadn't realized the op costs would produce such a difference but it demonstrates you have to do the math. I took the metal amounts and the metal costs used in the economic analysis for 2008 and 2012. Once again the number is surprising when you do the calculations. Here's the results in a table:

	2008			2012
	metal	price	value	metal	price	value
cu(lbs)	4760000000	3.12	14851200000	4875000000	3.25	15843750000
mo(lbs)	255200000	33	8421600000	214900000	14.64	3146136000
au(oz)	4500000	692.85	3117825000	4210000	1445	6083450000
ag(oz)	32500000	13.09	425425000	25100000	27.74	696274000
			26816050000			25769610000
			26.81605			25.76961
				-1.04644

It wasn't obvious to me that there was $1 billion less metal value in 2012 compared to 2008. The significantly higher op costs and less metal value in 2012 would drive CUU to select a bigger project to try to offset this problem. Economies of scale could help with the op costs but not nearly enough in this case. Teck has signalled they are examining a smaller size project so we'll see what information is released in the next JV meeting later this month. Thanks for your contribution.

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