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Gold/Mining/Energy : Mining News of Note -- Ignore unavailable to you. Want to Upgrade?

To: LoneClone who wrote (20700)	6/2/2008 10:52:09 AM
From: LoneClone	Read Replies (1) \| Respond to of 194794

Adanac Completes Bridge Financing on Ruby Creek Moly Project By Jane Perry 30 May 2008 at 03:10 PM GMT-04:00 resourceinvestor.com VANCOUVER (ResourceInvestor.com) -- Adanac Moly [TSX:AUA] has turned an important corner in its path toward production, having completed its bridge financing to the tune of $68.5 million - as per the company’s May 27 news release. Proceeds from the private placement, first announced on April 16, will go towards ongoing development of the company’s proposed Ruby Creek molybdenum project. The funds will cover detailed engineering, construction planning, and administration. It will also enable the company to take possession of the processing equipment on order for the Ruby Creek project. The financing came through the company’s U.S. investment banker, with support from global institutional investors. Adanac will grant warrants for common shares equal to 21.4% of the fully-diluted outstanding shares of common stock. Ruby Creek Ruby Creek is a low-grade bulk molybdenum (porphyry molybdenite) deposit located in the northwest corner of British Columbia, about 22 kilometres northeast of Atlin, British Columbia and 124 kilometres southeast of Whitehorse, Yukon. The production schedule provides for 16 years of mining and 21 years of processing, based on a mining cutoff set at 0.04% Mo. Ruby Creek boasts a open pit mineral reserve of 157.7 million tonnes grading 0.058% Mo using this cutoff grade. This essentially works out to a pound of moly per tonne of rock- making it $30 rock. The company should be able to mine it profitably for $20 a tonne. This allows for a wide enough margin of error to allow for price fluctuations and unforeseen events (weather/labour issues, etc.). Valuation Ruby Creek is a project of critical importance in reviving the B.C. mining scene. It will be the province’s first new mine of any significance to come on stream in over a decade- since Royal Oak’s Kemess Mine (now owned by Northgate Minerals) started producing copper and gold in the early 90s; and since Al Gore killed Windy Craggy. This play deserves a closer look right now for several reasons: * Adanac is using the very best engineering consultants: Wardrop did the feasibility, and Golder did the mining feasibility (incl. mineral reserve estimates), other reports (tailings); * Easy location: 1/2 hour drive to Atlin, 1.5 hours from Whitehorse; * Road access to Skagway, Alaska’s deep water port; * 60 miles from the Whitepass & Yukon railway; * 100%-owned, no royalties on the property; * Timing is everything: the company has secured bridge financing, and is at the final stage of the permitting process. This creates a window for investors before construction starts. It’s also the time of year when mining stocks typically pick up and dust themselves off in anticipation of the summer season. * Accessible price point; * Molybdenum is currently trading at $32.90/lb. According to Wardrop’s net present value and IRR summary, “In this base case the project has an IRR of 24.42% and an NPV of C$222 million at an 8% discount rate. Payback is 3.1 years.” With the bankable feasibility done, interim financing now in place, and remaining permits expected shortly- the market could well see liftoff in this case. AUA traded at C$0.73 Friday, up C$0.01.