Wednesday, March 20, 2013

Teck the Polish and Copper Fox

From a discussion on Agoracom.
My follow up post:

Normally this is where instituions begin looking at buying. You'd expect to see them driving up the price. With the Polish buying Quadra there's obviously a track record here showing a rock solid major in action.
Still, no institutional buyers. AME has the money to develope and it appears the project is waiting for their enviro. This will signal institutions that it's buying time. The local opposition is a clean air group that popped up out of no where. Hmmm, might want to look into their funding. The other open pits have not caused a degradation to air quality to any extent. Go visit them. See for yourself. The worst air impact is the smelted just out of town. I lived in Kamloops I know. No, they are not building a smelter.
So 13.5 cents for 20% of 1/2 a SC? With cash and land this is below liquidation value. If the free markets set the price could this really happen? I say no and the regulators are not looking into any of this anywhere. Sure, Coffintrader got nailed but only because the regulators were pressured into acting. Again, this shows their complicity.
Do I expect the sp to run away? Nope. Even though the company has a track record of exceeding enviro standards there is no faith in the market and manipulation has destroyed what was left of support.
By comparison, CUU is in a very like position. Sure, we have a better deal and do not have to take a deal. More likely, Teck has to back in because we sit in the number 2 spot for a take out. Of all the mines in Canada this one has the least number of issues. The number one spot is taken by a better grade with the trade off of some enviro issues. Globally, without taking jurisdiction into account we would rank in the top ten. Size does matter. If the North West block continues to prove up we will catapult globally.
Given the high grade results from last year there has obviously been a change of heart and the company is no longer looking for a quick sale. As it should be! There could be a $15 payday if we went the whole course. It would be pure fantisy land to hope we'd retain our shares right to profitability because the time risk is still there. I'm convinced there's enough potential to warrant this. Even if a small extra deposit could be proved up this would be worth keeping. We could leverage it and develop Az without dilution.
Yes, you have to be corporate minded to see it this way. We are talking long spans of time. Elmer wants the security of a revenue stream to fuel other developments as any mid level developer would. Study the early days of HD. They had to painfully build that company one brick at a time. I can remember a couple bumpy patches from the past and there are some current ones.
Looking at the enviros. We'll beat them to the line up. The buzz is that we await comments only. A similar situation for AME. They however, need to plow in a lot more work. It is true that the arid nature of their location does make them more prone to dust. The are also located right by a major city. In terms of who is better, CUU wins that one hands down. I did speak to the Chiefs 2 years ago and there was a good feeling about it. The natives in our area have also set aside most of their differences. To probe these deeper we would need to look at strip ratios and pag. CUU has a small edge there but a dry location means less acid. Then we'd need to look into processes. But at this point we'd be splitting hairs. The other advantage is our ratios of bonus metals. Elmer is correct as you'd expect in this matter.
While we are at it. DCY.v is a fully modeled deposit. No one has bought it! I thought for sure they'd be bought last year at about 30 cents. Didn't happen. Interestingly, they survived chapter 11 by a hair and their sp rose and is holding. With 43M shares (need to varify this) they are not worth manipulating. There's simply not enough shares. So why have they not been bought out? Location location loc... They are a periphery so the major look at that and say "let them wait". They were one of the first guys to discover the higher grades that existed below the Cherry sheet. They demonstrated the glory hole concept from their sharply thrusted ground. They are probably worth a study but determining when they might have a liquidity event??? Perhaps selling price is an issue. Should this deposit quality be found on our property it would generate excitement.
Sometimes investing is like watching a teenage popularity contest. The money flits here and there until one area settles as the dominant one. There's often no rhyme or reason to it in the early stages. You can have the greatest project and get no respect. It's not until a group starts following you that the rest of the herd notices a crowd gathering. That catylist will be the $25B that's coming to roost in Northern BC. At that point even the not so pretty girls will be asked to dance. The boys will rationalize it as "she's sturdy and can work hard". I'm betting that I was right about the east west battle for attention. Right now they can manipulate us in the west but for how long. We need a major example set before the political winds change. After that the door to the dance hall may be closed for another 20 years.

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