Monday, October 29, 2012

Happy Creek Moving Up

What people don't understand about Happy Creek yet.

There are about 500 thousand pp shares going through right now. That represents the last of them and the only thing holding up the sp show. Us smart guys won't give a premium for them. 18 cents or perhaps 20 cents but that's it. Once those are gone you can expect the sp to double in short order. There are not enough shares in the float to make everyone happy so some people will pay more.

How big is their copper deposit?  In a word, huge. With sparse drilling I can calculate an easy 1/2 billion pounds. Compared to GRV or CUU this may seem like small potatoes for now. GRV has a lot of overburden and CUU is fighting an uphill battle with the sp. What people don't know is the scope of HPY. I suspect that between the 2 zones they will churn up 5 billion pounds. The grades are good and getting better. On piece of land has hardly any work done and has room for a major to partner up. The recon is showing a massive couple of deposits. CUU people have seen this signature before! Here's zone 1: 
Here's Zone 2:

See the Property description:
Then look at the NR from January:

Remember those huge Rhenium hits? They look like the calculate out to be 5 kilos a tone in some spots.  Rhenium only really counts when it's economical to process it. A 1/2 kilo is worth money. Over that is a big payday. Now, I know for sure this did not escape the guys in Pensilvania. You can bet they saw this and called. I hope we get more info soon about it. This is a very big find for Canada.  
And then there's the tungsten open pit possibility. Currently, there are not a lot of open pit options out there. I discuss Blackheath because they know there's still value in reactivating those old mines. But here is a fresh untouched open pit mine. For just 35 million this can be up and operating. FYI, I bet that's exactly what HPY will do. We should keep an eye out for money talks. I also would listen for partnership rumors. Here's why. There is currently about 60 to 80 million worth by extropolation. I bet that with a bit more drilling they will prove up to 90 million worth and I calculate the potential to be 300 million. This latter estimate will take about 1 full year of drilling. I think that in less than a year someone will make an offer they can live with. So a $2-$3 spinout is completely in line. If for some strange reason no deal can be reached then I give them 3 years to go for production. Fortunately there are examples so we can safely say the IRR will be outstanding. Factor in the cost of money (dilution and equity) and this is easily $7 before the first shipment. If the full potential is reached with an estimated IRR of 52% you'd be looking somewhere over $16. Obviously I'm not going to bother with the multiples some would expect for a company with earnings. You should also read this:  Remember that this is under ground.

The Hawk property as you've seen is ripe for a JV? Perhaps Henning Mining, a private company, might want to bring European money in and claim a share. This is right up their alley. I could see an even bigger group coming in because the results just keep getting better and better. Go here and look at the table of samples: 

And then there's the free Silver Dollar property. SD looks promising. There are a lot of historical around that area. The are doing some airbourne work and I'm gonna bet they find something worth looking at. When was the last time you came across a company with this many promising properties? In August the studied the West Valley property and came up with some geology that shows some very high potential targets. It's like they can't throw a stone without hitting something. I challenge you to find a better set of properties anywhere.

 So here's a little project generator that's completing it's mandate to become a producer. It's going to take a very serious offer to get them to allow someone in.

Water issues - No. Has permit. Unfounded.

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