.
Looks like the Zijin Mining acquisition price of the Shapinggou Molybdenum Mine works out
to roughly US$0.60 / lb ..... or CDN$0.79 / lb
USD rmb exchange rate roughly 7.1 rmb : 1 usd
xe.com
5.91 billion rmb / 7.1 = roughly US$830 million or CDN$1.1 Billion at $1.33 exchange rate
As stated in the news article cited below:
2,337,800 tonnes of ore grading 0.143% average or a 630,000 tonne moly resource
US$830,000,000 / 630,000 tonnes = $1317 / tonne / 2200 lb = US$0.60 / lb purchase price
US$0.60 x $1.33 exchange rate = CDN$0.79 / lb
Stuhini's Ruby Creek molybdenum deposit has a lower average grade of 0.053 % but would
also be a lower cost open pit mining operation. The Ruby Creek moly deposit holds about
1/3 the resources of Zijin MIning's recently acquired Shapinggou underground mIne.
Ruby Creek has a current pit constrained 43-101 compliant resource of 476 million lbs of
molybdenum in the measured, indicated and inferred categories, is road accessible and
has a mining permit in place.
March 2022 Ruby Creek Project Mineral Resource Estimate
static1.squarespace.com
The Ruby Creek moly deposit is in all likelihood much larger, as the pit constrained resource
estimate does not include some drill holes that returned the highest grades and ended in
mineralization
ie. See page 14 of the November 2022 Corporate presentation.
"(The deposit is still open to depth and to the southwest : hole AD-417 bottomed out in
45 meters of 0.23% Mo) "
static1.squarespace.com
Based on the acquisition price paid by Zijin Mining for the Shapinggou Mine, it is not
unreasonable to conclude that Stuhini Exploration is severely undervalued with a current
market cap of only CDN$11 million.
GLTA !
________________________________________________________________
Zijin Mining to Acquire World’s Largest Molybdenum-only Mine
By NS Energy Staff Writer 27 Oct 2022
The Shapinggou Molybdenum Mine is situated in Jinzhai County, an old revolutionary base
deep in the Dabie Mountains. The deposit was discovered only at the beginning of this century.
Zijin Mining to acquire Shapinggou Molybdenum Mine. (Credit: Zijin Mining Group)
Zijin Mining entered into an agreement with Anhui Jinsha Molybdenum Co., Ltd. to acquire an
84% interest in the company for RMB 5.91 billion, which will see Zijin control the world’s
largest molybdenum-only deposit.
The deal was secured through public tendering at the Anhui Assets and Equity Exchange.
Located in Jinzhai County, Anhui, China, the Shapinggou Molybdenum Mine is a world-class,
ultra-large porphyry molybdenum deposit with 2,337,800 tonnes of resources within the area
covered by the exploration license.
The project is designed to mill 10 million tonnes of ore and produce 27,200 tonnes of
molybdenum per annum. Completion of the transaction is subject to the ongoing conversion
of the exploration license into a mining license.
Following the completion of the acquisition, Zijin Mining’s attributable molybdenum resources
will surge from 920,000 tonnes to 2.9 million tonnes, accounting for approximately one-third
of China’s total. And the company will be on track to become one of the world’s largest
molybdenum producers.
The Shapinggou Molybdenum Mine is situated in Jinzhai County, an old revolutionary base
deep in the Dabie Mountains. The deposit was discovered only at the beginning of this
century.
It has 2,337,800 tonnes of resources and is the world’s largest molybdenum-only mine.
With an average grade of 0.143%, the mine has about 630,000 tonnes of resources
grading as high as over 0.3%, while 65% of molybdenum resources in China have
a grade of less than 0.1%.
The deposit has only one main orebody that is 660 meters thick on average.
The apple-shaped, thick orebody hosts 99.9% of the mine’s resources and is thus
suitable for large-scale underground mining.
Such resource endowment will enable Shapinggou to achieve low-cost development
and fast returns, making it a highly competitive project in the market.
According to the design of China ENFI Engineering Co., Ltd., the project will be built
with a throughput of 10 million tonnes and produce 27,200 tonnes of molybdenum per
annum after reaching its designed capacity.
Construction will be completed in 4.5 years and the project will have an initial mine
life of 57 years.
Based on a price of RMB 150,000 per tonne of molybdenum concentrate, it is estimated
the project will generate approximately RMB 1 billion in earnings per annum, creating
brand new scope for Zijin’s growth.
Doubling down on a strategic mineral that represents the future
Molybdenum is a strategic, minor metal that is scarce in the world. There are few
molybdenum-only deposits in the world as molybdenum often occurs as an associated
mineral in copper and other metallic mines.
In recent years, there has been only a slow increase in the supply of the metal as it is
subject to the development of copper mines.
China is one of the major molybdenum-rich countries in the world, and the largest
producer and consumer of the metal. The country has a molybdenum resource of
about 8.3 million tonnes and an annual production capacity of about 100,000 tonnes,
accounting for 46% and 38% of the global total, respectively.
Molybdenum is in strong demand in both traditional industries and the renewable
energy industry. Molybdenum and its alloys provide good thermal and electrical
conductivity, high-temperature performance, and strong resistance to wear and
corrosion.
They are widely used in such industries as steelmaking, chemicals, energy, and machinery
manufacturing, with great potential for even more applications.
Against the backdrop of carbon emission reduction, the use of molybdenum is also growing
rapidly in photovoltaic power, wind power, aerospace, arms production, etc.
The International Molybdenum Association predicts that by 2050, the wind power industry’s
cumulative demand for molybdenum will reach 300,000 tonnes, topping the metal’s total
annual supply. Some institutions even view molybdenum as the “mineral of the future”.
In recent years, Zijin Mining’s molybdenum resources have been growing rapidly. The company
has copper-molybdenum mines such as the Julong Copper Mine in Tibet and the Duobaoshan
Copper Mine, and its total associated molybdenum resources amount to approximately
920,000 tonnes.
By 2025, the annual production of associated molybdenum will be nearly 10,000 tonnes.
Upon commissioning of the Shapinggou Molybdenum Mine, Zijin Mining’s molybdenum
production capacity is expected to exceed 40,000 tonnes, making it the largest molybdenum
producer in China.
According to data published by CRU, the global supply of molybdenum in 2021 was
about 264,000 tonnes, while the demand was about 266,100 tonnes.
At present, there are only seven molybdenum mines in the world that produce more
than 10,000 tonnes of the metal per annum, among which only two produce over
20,000 tonnes per annum. Upon commissioning, Shapinggou will likely become one
of the largest molybdenum operations in the world, producing 10% of its total
molybdenum supply.
Some S&P analysts believe that the global supply of molybdenum will remain tight over
the next five years. The price of molybdenum concentrate recently rose to RMB 300,000
per tonne again after 14 years.
nsenergybusiness.com
GLTA ! |
