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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers -- Ignore unavailable to you. Want to Upgrade?

To: marcos who wrote (55973)	1/25/2008 6:09:31 PM
From: tyc:>	Read Replies (1) \| Respond to of 78426

>>what do you think the chances are of Metallica doing like Inmet, just trying to get the best possible value out of it in cash while letting it go to Xstrata? That is very possible, and makes for interesting speculation of value. Perhaps that is what Claude had in mind when he spoke the other day about "strategic decisions". For those interested, here's what happened to Inmet at Antamina. Inmet had spent $50 million on Antamina when it had to drop out because it couldn't finance its 50% interest. It sold out to Noranda and Teck, recovering its $50Million sunk cost and an extra $7M in profit. In addition it retained a 3.3% net profits royalty, payable (of course) after owners had recovered their capital (bear in mind IMN had aleady recovered its capital. Several years later it sold that 3.3% Net profits interest to Noranda for >US$20 million. REPEAT US$20M for its 3.3% Net profit interest. Not bad. The other day I compared El Morro to Antamina in apparent value. How much would Metallica's 30% interest be worth? Surely a lot more than the US$20M Imn got for its 3.3% interest in Antamina Incidentally, Metallica carries its interest in El Morro on its books for ZILCH. Like IMN it has already made a profit on its ownership from the US$10 Million cash payment its senior partner has already made to it.