Wednesday, December 11, 2013

Here's the I told You So - HPY proves the Tungsten Value

Happy Creek's Fox Tungsten Returns 70% W03 in Premium Gravity Concentrate

(via Thenewswire.ca)
December 11, 2013 - Vancouver, British Columbia - Happy Creek Minerals Ltd. (TSX-V:HPY, the "Company") announces results from preliminary metallurgical work conducted on its 100% owned Fox tungsten property.
The Fox property is located approximately 75 kilometres northeast of 100 Mile House in the south central Cariboo region of British Columbia, Canada. Trenching and/or drilling in three areas that span a distance of three kilometres have discovered high tungsten grades over considerable thickness that are at or near surface. Drill highlights from this new discovery include 7.35 metres of 1.22% tungsten (W03), 19.4 metres of 0.82% tungsten, 11.0 metres of 0.80% tungsten, 20.0 metres of 0.63% tungsten, 24.7 metres of 0.68% tungsten and 22.0 metres of 0.76% tungsten at the RC zone. One kilometer to the south at the BN prospect, F12-27 returned three intervals: 4.1 metres of 1.78% tungsten, 14.8 metres of 4.0% tungsten and 24.0 metres of 0.79% tungsten including 5.8 metres of 2.01% tungsten (Refer to Press Release dated November 19, 2012 and September 9, 2013). Looking selectively at very high grades, to date 28 drill intervals have returned a weighted average of 3.0 metres grading 2.33% tungsten.
During 2012, 816 kg of rock was collected from the trenches at the BN, RC and BK zones. The samples were submitted to Met-Solve Laboratories Inc. of Langley, B.C., for initial mineralogy and metallurgical investigation. The composite sample used for the test work graded 0.95% tungsten and 0.26% zinc.
The test sample was processed first by removing zinc using flotation, and followed by gravity concentration of tungsten using spirals and tables. The first pass gravity circuit recovered an average 59.3% of the tungsten into a concentrate with 43.3% W03. Importantly, this simple first stage testing does not include the up-grading and recovery benefits of subsequent cleaning, recycling and tungsten flotation that is done in locked cycle testing. The results include a 70% W03 product from the coarse cleaner concentrate that exceeds published commercially viable grades. For reference, 70.0% W03 contains 700 kg W03 per tonne of concentrate and tungsten prices for concentrate are currently around CAN$35.0/kg W03.
In addition, a primary zinc cleaner concentrate yielded 18.4% zinc, 4.04 g/t gold, 156.0 g/t silver and 66.0 g/t indium, recovering 68.9% of the zinc in less than1% mass yield. These preliminary results indicate that the zinc and associated gold, silver and indium values could potentially be recovered and upgraded in subsequent cleaning stages.
Met Solve Laboratories reports "The results indicate that excellent upgradeability as a high grade tungsten product can be obtained" and "The next phase of test work should be done to determine attainable grade and recoveries with recycle streams via locked cycle testing".
David Blann, P.Eng, President and CEO of Happy Creek states "We are pleased to see this very positive response from an initial, simple gravity concentration circuit and the opportunity for a by-product with zinc, precious metals and indium. With these tests being successful, we can look forward to continue advancing this new, top tier tungsten discovery."
Sample Details
Collection of the test sample was performed by drilling and non-ex blasting of trenches from the BN, RC and BK zones. Twenty six samples were collected into large rice bags that totaled 816 kg, or roughly 31kg per sample. All samples were fully crushed and a sample analyzed. The metallurgical sample was selected from variable weight splits of 15 of the samples totaling 255 kg .This sample returned characteristics including a target grind size of 91 micron particle size, a Bond work index of 12.7 KWhr/tonne, and a process approach to employ flotation of zinc first, then concentrate the tungsten in the remainder using Falcon spiral and MAT (Met-Solve Analytical Table) to concentrate tungsten (scheelite mineral) by gravity. At the current stage of the Fox property, the metallurgical sample is not meant to be a final or representative sample of the entire project, but to provide preliminary mineral and metallurgical data to support further economic consideration and direct future exploration strategies on the property. Analytical results from the twenty six samples obtained from the surface trenches are presented below.
Fox Trench Samples
W03
W03
W03
Sample
%
Sample
%
Sample
%
93272
1.001
93282
6.508
93292
11.527
93273
1.246
93283
6.710
93293
5.928
93274
0.256
93284
3.645
93294
4.364
93275
0.499
93285
5.675
93295
0.623
93276
0.145
93286
1.753
93296
11.389
93277
0.029
93287
3.922
93297
2.535
93278
0.291
93288
4.641
93279
0.812
93289
5.562
93280
0.463
93290
3.380
93281
8.009
93291
1.196
A locked cycle test is a series of repetitive batch tests (cycles) to simulate the operations of a continuous process in which intermediate-grade materials are recycled upstream. Depending on the sensitivity of the separation, when equilibrium is reached in two or more cycles the test is said to be 'locked' or 'balanced.' Cleaning of an initial concentrate product means removing unwanted material to effect an increase in grade of the concentrate. For tungsten particles too small to be captured by a gravity circuit, flotation is commonly used to increase recovery and produces an additional concentrate product. These tests are normally involved in design of a final mill flow sheet. Work done to date on the Fox has allowed a locked cycle flow sheet to be developed for the next testing stage. The Company plans to perform these additional tests once the Fox tungsten deposits are more completely drilled off and more knowledge is obtained on the grade distribution, mineralogy and geology.

Thursday, October 24, 2013

Only1Word

If you get it share it:
http://www.youtube.com/watch?feature=player_embedded&v=WPkByAkAdZs
Nostalgia :)

Friday, September 27, 2013

Happy Creek drilling proves it

For those of you wondering what I see in Happy Creek, this is more of it. Their tungsten property just keeps growing. David Blann, CEO, does not seem in any hurry to develop it for a quick sale. He just keeps expanding and filling it in. They are well on their timeline (I gave two years last summer for them to take the first steps) towards achieving an operating mine.

Happy Creek drills 8.2 metres of 0.86% tungsten trioxide (W03) near surface in southward step out hole at Fox property

(via Thenewswire.ca)
September 25, 2013 - Vancouver, British Columbia. Happy Creek Minerals Ltd. (TSXV: HPY) (the "Company") is pleased to announce results from an additional four drill holes on its 100% owned, 165 square kilometre Fox tungsten property. The property is well situated approximately 25 km east of the past producing Boss Mountain molybdenum mine, and 75 km northeast of the town of 100 Mile House in the south-central Cariboo region of British Columbia, Canada.
The Company has explored the Fox property from an early stage returning positive values of tungsten in rock, stream sediment, soil and drill core in a 10 km by 3 km area. Positive to potentially economic values of tungsten occur in two areas located on the south and north sides of an granitic intrusive rock that is similar in age to the Boss Mountain mine.
In the northern area on the east side of Deception Mountain, four outcropping mineralized zones occur over a three kilometre distance: from south to north, the 708, BN, RC (Ridley Creek), and BK prospects. These prospects span a distance of three kilometres and have a lateral extent thought to be greater than one kilometre. Since the first drilling discovery in 2011, the Company has tested three of the prospects with encouraging results. The main focus of the 2011-2013 drilling was the RC zone.
Results
At the RC prospect, drilling continues to define and expand a new tungsten deposit that occurs at surface and dips shallowly westward. Drill holes F13-04 (vertical) and F13-05 (-50 degrees to the west) are located approximately 40.0 metres southwest of F13-3 (22 metres of 0.76% tungsten trioxide (W03). Refer to News Release dated September 9, 2013). F13-04 and 05 encountered the favorable geology from surface, with values of 0.01 to 0.03% tungsten trioxide starting at 6.0 metres. F13-04 ended at 50.9 metres, with the final 0.5 metres containing moderately strong pyroxene calc silicate thought to indicate potential for additional tungsten mineralized zone to occur at depth.
F13-06 (-55 degrees west) is located approximately 40 metres south east of F13-04/05, and starting from 14.0 metres returned 16.0 metres of 0.23% tungsten trioxide including 6.2 metres of 0.55% tungsten trioxide and 0.25% zinc.
F13-07 is located approximately 60 metres east of F13-04/05, and 35 metres south of F12-17 (20 metres of 0.63% tungsten trioxide). F13-07 (vertical) returned 22.0 metres of 0.36% tungsten trioxide starting at 12.0 metres below surface, including 8.2 metres of 0.86% tungsten trioxide.
David Blann, President and CEO of Happy Creek states: "F13-06 and 07 have expanded the near-surface zone southward with positive grades and it remains open in extent. The results fit within our target range for potentially economic near-surface mineralization, and compare favorably to other known tungsten mines. The RC prospect is just one of four prospects containing high tungsten grades at and near-surface and we continue to see tremendous potential in this new discovery over the three kilometre long target area."
Due to the flat-lying mineralized horizons, vertical drill hole intersections are very near true thickness, while angle drill hole intercepts are approximately 130-135% of true thickness. Drill highlights from discovery in 2011 and follow up in 2012 at the RC prospect include 7.35 metres of 1.22% tungsten trioxide, 19.4 metres of 0.82% tungsten trioxide, 11.0 metres of 0.80% tungsten trioxide, 20.0 metres of 0.63% tungsten trioxide and 24.7 metres of 0.68% tungsten trioxide. One kilometer south of the RC prospect, the BN prospect returned three intervals in hole F12-27: 4.1 metres of 1.78% tungsten trioxide at surface, 14.8 metres of 4.0% tungsten trioxide and 24.0 metres of 0.79% tungsten trioxide including 5.8 metres of 2.01% tungsten trioxide. One kilometre north of the RC prospect, drilling at the BK prospect returned 5.0 metres of 0.68% tungsten trioxide. (Refer to Press Release dated November 19, 2012). A review of drill results from the Fox property to date identified 25 intervals averaging 3.2 metres and 2.36% tungsten trioxide that comprise a portion of the favourable horizon thickness.
A grade of 2.4% tungsten trioxide contains 24.0 kg W03 per tonne of rock, and recent tungsten prices are around US$34.0/kg W03 in concentrates and US$42.0/kg W03 as APT (ammonium paratungstate) (1).
Tungsten is regarded by the British Geological Survey as a strategic and critical metal essential for industrialized countries. Over 50% is used in cemented tungsten carbide to make cutting tools for the construction, metalworking, mining, oil and gas drilling industries. The balance is used in applications requiring high temperature stability and density in electronic components, super-alloys, wear-resistant alloys and chemicals. Values of zinc, gold, silver and indium also occur with tungsten at the Fox property. Indium is a rare metal used in liquid crystal applications such as touch screens.
The proximity to infrastructure, near surface setting, large scale and presence of high grade tungsten are thought to make the Fox property a unique and attractive new exploration discovery in the global tungsten sector.

Friday, September 6, 2013

The Carnage continues at the TSX

Here's an example of a great mine bending over just to keep the forward momentum going.

VANCOUVERSept. 5, 2013 /CNW/ - Spanish Mountain Gold Ltd. ("Spanish Mountain" or the "Company") (TSX-V: SPA) is pleased to announce that it has engaged Secutor Capital Management Corporation to act as lead agent (the "Agent") on a commercially reasonable basis for a proposed private placement (the "Offering") to raise up to $3,000,000 through the issuance of up to $1,500,000 of common share units (the "Units") and of up to $1,500,000 of flow-through units (the "FT Units").
Each Unit will be sold at a price of $0.10 per Unit and will consist of one common share of the Company and one common share purchase warrant (a "Warrant"). Each FT Unit will be sold at a price of $0.12 per FT Unit and will consist of one common share of the Company which will be designated as a flow-through share (the "FT Shares") for the purposes of the Income Tax Act (Canada) (the "Tax Act") and one-half of a Warrant. Each full Warrant will entitle its holder to purchase one common share at a price of $0.15 per share for a period of two years following the closing of the Offering. The Company has also granted the Agent an over-allotment option, exercisable at any time prior to the closing of the Offering, to purchase an additional 15% of the total number of Units and FT Units sold pursuant to the Offering.

SPA is creeping up very slowly. Often during this month you see the bigger stocks showing volatility as people hunt for deals in the JR market. So far, no sign this is happening. I still expect movement in the bigger stocks but I don't expect to see anything spectacular in the JR market primarily because of the horrendous damage the TSX has done to it.

I won't be selling any dividends. Instead, I'll bargain hunt there. Until the new exchange shows life I suspect my predictions from the past will hold true. Cash will be king and the decimation will ramp up. You may still see a false euphoria designed to trick people into thinking a stock is taking off but it will be followed by a harsh decline. There are still a lot of people holding the TSX bag.

I still expect to see more development in the real deposits of Canada. The safe haven idea is becoming a fact. I plan to hold developing mines like Schaft Creek but I'm expanding the timelines. Previously I said 2 years but now I'm going to invest on a 5 year plan. Take HPY. They just got a former Teck geologist on board. Given the slowdown at Teck I expect David Blann will be doing a lot more infill this year and next. The idea behind obtaining the new face is to customize the plan to Teck's needs.

HPY still has that lovely tungsten deposit that's shaping up rather nicely. The last round of drilling was proof of the value. I find it funny the market has not caught on. Are the investors waiting for it to become more advanced? Watch as many get left out in the cold. They will be scrambling to determine fair market value and a deal will side swipe them. I'm expecting this one to come in out of the blue and you can't say I didn't warn you. At 15-16 cents it's an absurd bargain. The new results suggest a real value well over a buck. In this market, it might jump 60 cents. as it changes the nature of its development.

If I get time I'm going to delve in deeper on the market movements. I'm expecting to see some action in the bond market that might shake things up as the realization of shortages sets in and managers try to find a buck.

Friday, August 30, 2013

Summer is almost over

So what's really happened while I was gone. I see HPY uncorked another stellar hit in their tungsten property! Copper Fox spun off into Desert Fox. Drills are rolling at Schaft Creek under Teck and we may finally see som forward movement in Arizona. SPA is gaining traction despite the TSX. Pilot and Probe have restored close to former value. ALS didn't pancake as many called for. BXX has survived and it's still a fat little piggy that needs a major hit in some way. I see GRV still holding value and I expect the next results to show this is a mine able property. Hellooo neighbour, need some copper?

Now, the one to watch this year:
Colorado Resources Announces 402m of 0.28 % Cu and 0.27 g/t Au in Step-Out Hole 400m Southeast of North ROK Discovery Hole 1

WEST KELOWNA, BRITISH COLUMBIA--(Marketwired - Aug. 28, 2013) - COLORADO RESOURCES LTD. (TSX VENTURE:CXO) ("Colorado" or the "Company") is pleased to announce the results of nine additional drill holes (3,148 metres) from the ongoing drill program at its 100% owned North ROK property (the "Property"), located 15 kms northwest of Imperial Metals' Red Chris mine in NW British Columbia. In addition, the Company announces that it has received approval from the Ministry of Energy, Mines and Natural Gas ("MEMNG") to drill an additional 40 holes on the Property.
Drill holes NR13-005 through NR13-009, NR13-012 and NR13-013 were drilled on 100-200 metre step-outs along strike to the southeast of discovery hole NR13-001, while drill hole NR 13-011 was drilled 100m to the northwest of the discovery hole. Drill holes NR13-006, NR13-007 and NR13-013, which stepped back to the southwest, have also returned mineralization 150m off the main trend and may indicate the presence of a second, parallel zone developing in this area.
The Company is very pleased with the progress it has made in defining the size of the North ROK porphyry body, and demonstrating the continuity of mineralization on multiple sections over a 500m strike length. NR13-013 in particular, drilled over 400 metres along strike SE from the initial discovery drill hole, has returned an impressive 402.2 metre interval grading 0.28% copper and 0.27 g/t gold (0.45% Cu Eq*), including 160.9m of 0.41% copper and 0.28 g/t gold (0.58% Cu Eq*). With NR13-009 failing to achieve planned depth, the mineralized zone remains open to the southeast of this important intersection. The Company has now completed first-pass drilling on 500 metres of the 1,200 metre long magnetic high trend, giving the technical team a good understanding of this significant mineralized system, which continues to remain open along strike in both directions, and at depth.
Adam Travis, President and CEO of Colorado Resources commented, "In a mere 4 months since our initial discovery hole was announced, we have completed nearly 6,000m of drilling, enlarged the North ROK porphyry body to over 500m in strike length, maintained average grades of over 0.50% copper equivalent* ("Cu Eq") (0.30% copper and 0.37 g/t gold) in a total of over 1,800m of mineralized intersections, and returned significant porphyry mineralization from 10 of 12 holes. I am particularly encouraged by hole NR13-013 - our farthest mineralized intersection from the discovery hole - which had to be terminated at the drill's maximum capacity (565m depth), but was still returning mineralized material grading 0.24% copper and 0.11 g/t gold (0.31% Cu Eq*) from the bottom of the hole."

Wednesday, July 31, 2013

Equedia Exposes Warehousing Scams

I wrote a comment in response to the Equedia article, see below.

http://www.equedia.com/get-out-before-its-too-late-commodities-manipulation-revealed/#comment-4522

Oil-igopoly!
Most of our investments are being manipulated. It should come as no surprise that warehousing was a three card monty game. A shell game. An outright deception.
It’s up to us to guess where the manipulations will come in next. We can profit by contrarian investing against just about anything GS says.
It’s true that all of this is done under the watchful eye of the regulators and governments and this is why nothing is done until after the fact. They are allowed to do this because it is propping up a broke government.
There would be more reaction if more of the public invested. More people would be tuned into the realities and governments would be held accountable. This is why there are rules like “accredited investors”.
We the people are directly responsible for the behavior of the governments. Nothing was done about the police killing a Polish visitor on camera at the Vancouver International Air Port. Nothing will be done about the 9 bullets in the guy plus tasering the corpse in Toronto. There will be a bit of feet stamping but the din will subside and the government will get back to business as usual.
This list of wrong doing in North America is staggering when presented in totality and yet it can be passed under the noses of the people when presented one item at a time. I do not expect this nature to change. All we, the real investors, can do is wait for the next snafu.
The guy who wrote the book about how the barbarians eventually take down the elite in a repeated cycle was correct in his ideology. I wrote about how science has advanced so fast that to many it seems like magic. We all know what happened to witches in the dark ages. Are we their yet? For now it seems the armies of the elite have the upper hand. But, for how long.
It is becoming common knowledge that our politicos run a revolving door system. Just look at our own Senate. Google BC’s political scandals and read the wikki page. That’s always good for a laugh. Yet, has there been a change? Nope. They keep voting the same clowns in over and over. I guess they just like it that way.
The new trend that’s emerging is the remake of the people in the image of the corporations. I believe firmly that the destruction of our way of life is to make way for this rebirth. The politicos through big business and with them intend to remake our lives into a ultra fascism dream world. If it fails the politicos will blame the corporations and they in turn will point fingers at the governments. We will be holding the empty bag yet again.

Wednesday, July 17, 2013

Big news Coming for Happy Creek -HPY.v

Drilling has begun! Mark the calender if you're a trader. Given the shallow deposit occurrence the results will come faster. Many of us have waited patiently for some time for this program. In my last report I detailed some of the cost cutting measures but now we have it. 1200 meters gives us a lot of holes. With 12-15 holes we are going to get a very clear idea of the economics.

When the data infills the deposit we may very likely see the Koreans come back to the table with a real offer in hand. I calculate an IRR at 55%. Any IRR over 15% is good. But a small fast operation at @55 or better is outstanding.

For Comparison:
Tungsten Mining NL, (ASX:TGN) a company exploring for tungsten in Western Australia, on Thursday released the results of a scoping study showing the economic viability of its Kilba project. 
The study values the project, an open-cut mine slated to produce 154,000 MTU of WO3 a year for 7 years, with a net present value of $36 million with an internal rate of return of 34 percent. The $56 million capital expenditures outlay is expected to be paid back within the first year of operation.
Happy Creek:
Drilling on the Fox property is planned to consist of approximately 1,200 metres in 12 to 15 holes. Most holes are planned to be relatively short in length due to the near-surface position and near-horizontal orientation of the main mineralized zone, however a number of holes will test for additional mineralized horizons. Mapping between and beyond the known zones will be performed to provide a wider geological perspective of the area.

Drill highlights from 2011 and 2012 at the RC prospect include 7.35 metres of 1.22% tungsten (W03), 19.4 metres of 0.82% tungsten, 11.0 metres of 0.80% tungsten, 20.0 metres of 0.63% tungsten and 24.7 metres of 0.68% tungsten. One kilometer to the south at the BN prospect, F12-27 returned three intervals: 4.1 metres of 1.78% tungsten, 14.8 metres of 4.0% tungsten and 24.0 metres of 0.79% tungsten including 5.8 metres of 2.01% tungsten (Refer to Press Release dated November 19, 2012). Geological mapping and results from drilling in three areas indicate the main calc silicate/skarn unit hosting variable concentrations of tungsten is around 25-40 metres in thickness and approximately two kilometres by over one km in dimension. Results from F12-27 suggest multiple (stacked) mineralized zones occur.

In case you forgot or missed this:

A positive feature of the mineralized skarn zone is its potential to host very high grades: results include 0.40 metres of 9.60% tungsten, 3.64% zinc and 19.20 g/t indium (DDH F11-07). A grade of 0.7% tungsten contains 7.0 kg W03 per tonne of rock, and tungsten APT prices have recently risen to around $40/kg W03. Indium is a rare metal used in liquid crystal and touch screens and prices have also risen to over US$550/kg ($5.50/gram).

Happy Creek is bigger. The known mineralization confined to just the drill holes is $66M. If you expand this out on the asumption that all the data is correct it balloons to over $300M. I'm taking some liberties here but I'm confident about F12-27. Put a 50m by 50m square around it and go a bit deeper...

Highlights of Fox Property Tungsten Drill Results
  HoleFromToIntervalW03W03
ProspectHoleAngle(m)(m)(m)%kg/tonne
RCF11-02-905.710.855.150.919.1
RCF11-07-5514.319.04.71.0210.0
RCF11-08-908.2520.6512.40.747.4
RCF12-01-8514.032.419.40.828.2
RCF12-02-5513.025.012.00.212.1
RCF12-07-9013.016.03.01.1811.8
RCF12-09-9015.026.011.00.808.0
RCF12-10-5517.019.08.00.464.6
RCF12-11-9027.041.014.00.686.8
RCF12-13-9019.022.43.40.646.4
RCF12-17-9020.040.020.00.636.3
RCF12-18-5518.042.724.70.686.8
RCF12-19-5535.040.05.00.323.2
BKF12-20-9028.033.05.00.686.8
BNF12-25-5579.082.03.10.343.4
BNF12-26-483.06.03.01.9319.3
BNF12-27-801.96.04.101.7817.8
BNF12-27-8083.298.014.84.0440.4
BNF12-27-80136.0160.024.00.797.9
BNincludes-80138.0143.85.82.0120.1
BNF12-28-9083.186.02.91.2012.0
BNF12-29-6056.058.12.100.525.2

Copper Fox - Teck

The very long awaited answer is finally here. The question seems to have changed a bit. No, no buyout. Instead, we got a JV that seemed to take way too long. I think there were a few things that held it up. Voting rights for the Liard shares for one. The other biggie, how much was CUU going to give up to get a deal? You can't put $400 million into drilling! So this was going to be one of the big questions that had to be answered.

In past talks with Elmer he said they could build a road or use it for other developments etc. What appears to have been decided was to give it to Teck no strings attached. Well, perhaps one small string, a free ride to production. But wait, didn't they already have that? Well, no, not exactly.
From the Sedar filing:

4. ACQUISITION OF INTEREST, FORMATION OF A JOINT VENTURE 
4.1 Acquisition of Interest. 

(a) Teck hereby covenants to Copper Fox that: 
  (i) concurrently with the entering into of this Agreement by the Parties, 
Teck will make a cash payment of $20 million to Copper Fox; 
  (ii) subject to §4.2(b), Teck will make a cash payment of $20 million to 
Copper Fox within three Business Days of the Production Decision; 
and 
  (iii) subject to §4.2(b), Teck will make a cash payment of $20 million to Copper Fox within three Business Days of the Completion Date. 

(b) Teck hereby acquires, in consideration of its commitment to make 
payments as set out in §4.1(a), an unconditional 75% Direct Holding in the Property which, together with the share of the Indirect Holding it will retain under this Agreement, comprise an unconditional 75% Interest. 

4.2 Further Payments. 

(a) Teck hereby further covenants to Copper Fox that Teck will:
  (i) be responsible for and contribute 100% of Pre-Production Costs, 
without dilution to Copper Fox, until Teck has paid an aggregate of 
$60 million of Pre-Production Costs; and 
  (ii) contribute further funds, by way of loan to Copper Fox, as provided 
in §10.4(b). 

(b) In the event that Pre-Production Costs exceed $60 million, Teck will fund Copper Fox’s pro rata share, in accordance with its Interest, of such PreProduction Costs with such funding: 
  (i) firstly, applied to reduce the amount required to be paid under 
§4.1(a)(iii), and the amount of the reduction shall be deemed paid 
by Copper Fox; 
  (ii) secondly, if the amount of the payment under §4.1(a)(iii) is reduced 
to zero, applied to reduce the amount of the payment required 
under §4.1(a)(ii), and the amount of the reduction shall be deemed 
paid by Copper Fox; and (iii) thirdly, if the amounts of the payments under §4.1(a) (iii) and §4.1(a)(ii) are reduced to zero, paid by loan as provided in §10.4(b).

You can see some differences. For one, there's no claw back until $60 million is spent and that's going to be pretty hard to do. A revised Resource Estimate is coming and an updated FS is in order but the bulk of these two items are already done so they are just in need of updates. Between Teck and the CUU money it total $120 million.
In addition, there's further protection that any over runs would be credited to Copper Fox by way of loan. NO DILUTION!
Unincorporated JVs are, relatively speaking, the easiest to set up.  They are creatures of common law and equity and the rights of the JV parties will be wholly housed within the JV agreement (as opposed to some reliance on corporate law under an incorporated JV).  An unincorporated JV structure is generally also an effective flow-through vehicle for tax losses and revenues.
 Another thing that didn't quit go unnoticed... If the project economics don't look so goo then why did Teck form the JV and why are they now the explorer? The drill program is going to extend the North and the geo drilling will improve our understanding of what's under the mountain. Elmer, in the conference call said, should our understanding of the deposit bear out the extra width will allow the pit to go deeper. Yes, simple geometry. The drills ended in improving copper grades. We need to go deeper.
Does the new deal improve the odds of a buyer? Yes. From FRoR to RoFO. A right of first offer is related to a right of first refusal, but the former is considered to favor the seller while the latter is considered to favor the rights holder. Assets that have a right of first refusal attached to them can be more difficult to sell because potential buyers may not want to go to the trouble of negotiating a deal that must be offered to another party first.  
Overall, the path is becoming clear. CUU has the best operator money can buy ($360M worth). Teck will focus on their prime agenda and that's the main deposit and the economics. They have the CUU EBI money and can go nuts. CUU has a no obligation agreement and royalties that under the worst case per the FS comes in around $100M or so. 
Highlights from the conference call:
We'll be trying to move the project forward no matter what. The 2013 drilling should generate a 2014 drilling plan. 
CUU hasn't thought out in detail they're going to do with that money. We will be spending some money on AZ. 
No offer was made under the First Right to Offer clause. Given the climate today, it's not in the best interests of shareholders to make an offer. My own prediction is that 2015 will be the return to normal. The new exchange is going to help that in a big way.
Drilling will take about four months this summer. We have drilled into Dec. in the past.
Are lots of people showing interest? I think there is a distinct possibility that now we can be approached by companies. The way we're set up now with the interest in the JV solidified we would be of interest to other parties. Just watch and see as the USD changes. Just that alone is enough to spark interest.
All future expenditures of Schaft Creek will be paid by Teck.
Liard shares translate to about $100M per year. We also hold 2% Liard interest outside the JV. Our portion is not subject to the voting clause!
The FS has three very significant upside components to it. 1. considerable amount of inferred resources that is currently treated as waste. 2. Can we expand the paramount to the east, would probably result in pit change that allows greater depth  3. We have other remaining resources that could be upgraded to a resource that would add considerable value to SC.
My conclusions. This will become a mine. It's true that the whole world is suffering because of what a handful of bankers did. It's true that economics will have to improve before many mines turn dirt. I have given Spring 2014 as a date for real meaningful turn around. By 2015 the sp should be really performing. This gives less than 2 years to buy cheap. I'm still going to be wary of a snafu caused by hfts before the new exchange comes online. But, I think this deposit is safe because of the results obtained over the last 3 years in particular.
  
Vancouver, British Columbia -- July 16, 2013 -- Copper Fox Metals Inc. ("Copper Fox") (TSX-V: CUU) today announced the formation of a joint venture (the "Schaft Creek Joint Venture") with Teck Resources Limited ("Teck") to further explore and develop the Schaft Creek project located in northwestern British Columbia, Canada. 

"This partnership is a key milestone for Copper Fox Metals and reflects the spirit of the 2002 Option Agreement with Teck," says Elmer Stewart, President and CEO of Copper Fox. "We are pleased to have Teck as our partner and look forward to the next phase of our relationship. The terms of the Schaft Creek Joint Venture Agreement reflect the advanced stage of the project, and with Teck's expertise in the development and operation of large mining projects and strong commitment to responsible mining we are confident the Schaft Creek project will continue to benefit the Tahltan people, local communities and shareholders.

This agreement gives Copper Fox immediate access to funds and a viable partner to continue the work we have done on the Schaft Creek property without diluting Copper Fox's 25% interest in the Schaft Creek Joint Venture. With Teck's agreement to fund future costs, we have reduced the uncertainty around Copper Fox's future expenditures for the project."

Dale Andres, Senior Vice President, Copper for Teck, commented "This agreement represents an important milestone for our relationship with Copper Fox. We are pleased with the progress they have made and believe they will continue to be a valuable partner going forward."

Terms of the Agreement
  • The agreement replaces and supersedes the 2002 option and joint venture agreement between Teck and Copper Fox in connection with Schaft Creek.
  • Teck will hold a 75% interest and Copper Fox will hold 25% in the Schaft Creek Joint Venture.
  • Teck will be the operator of the Schaft Creek Joint Venture.
  • Teck will pay a total of $60 million in three direct cash payments to Copper Fox: $20 million upon signing the Schaft Creek Joint Venture Agreement, $20 million upon a Production Decision, and $20 million upon the completion of the mine facility.
  • In addition, Teck will fund 100% of costs incurred prior to a production decision up to $60 million; Copper Fox's pro rata share of any pre-production costs in excess of $60 million will be funded by Teck and the direct cash payments payable to Copper Fox will be reduced by an equivalent amount, and Teck will fund any additional costs incurred prior to a production decision, if required, by way of loan to Copper Fox to the extent of its pro rata share, without dilution to Copper Fox's 25% joint venture interest.
  • On signing Teck will reimburse $3.93 million for Schaft Creek mineral tenure acquisition costs and costs related to Stewart Bulk Terminal land reservation agreement incurred by Copper Fox.
  • Management of the Joint Venture will be made up of two representatives from Teck and Copper Fox with voting proportional to equity interests.
  • Teck has agreed to use all reasonable commercial efforts to arrange project equity and debt financing for project capital costs of constructing a mining operation upon a production decision being made; Teck has agreed to fund Copper Fox's pro rata share of project capital costs by way of loan, if requested by Copper Fox, without dilution to Copper Fox's 25% joint venture interest.
Teck and Copper Fox's Interest in the Liard Shares

The shares representing the 78% interest in Liard Copper Mines Limited ("Liard") that are included in the Schaft Creek Joint Venture will be held in the name of Teck for the benefit of Copper Fox (25%) and Teck (75%). Liard holds a 30% net profits interest in the Schaft Creek property.

Summer 2013 Exploration Program

The Schaft Creek Joint Venture intends to approve a Phase I, 2013 summer program aimed at increasing the value of the Schaft Creek project. The program will consist of approximately 10,000 metres of diamond drilling and geotechnical studies. The objective of the drill program is to test the extension to the east of the mineralization in the Paramount Zone and to collect additional geotechnical information for ongoing pit slope stability studies. Drilling is expected to begin before the end of July 2013.

BC Hydro Agreement

In March 2013, Copper Fox entered into a Facilities Study Agreement with the British Columbia Hydro and Power Authority ("BC Hydro") to assess the electrical and equipment requirements to connect the Schaft Creek project to the forthcoming BC Hydro Bob Quinn electrical substation.

Wednesday, July 3, 2013

Has The TSX Gone Crazy?

Oh regulators - - - EXPLAIN THIS!

Notice the price drop on a cross trade of ZERO shares??????
0.55 0  TSXV13:43:52
Macquarie Private Wealth Inc.
P.O. Box 779
Suite 3200,
181 Bay Street,
Toronto, ON M5J 2T3
(416) 864-3600
046

Macquarie Private Wealth Inc.
P.O. Box 779
Suite 3200,
181 Bay Street,
Toronto, ON M5J 2T3
(416) 864-3600
046
0.57500TSXV13:38:27


TD Securities Inc.
P.O. Box 1, TD Tower
12th Floor,
66 Wellington Street West
Toronto, ON
M5K 1A2
(416) 982-8222
007

Merrill Lynch Canada Inc.
Suite 400
181 Bay Street
Toronto, ON
M5J 2V8
(416) 369-7400
039