RE:RE:RE:RE:Business Valuation - Some Other ConsiderationsHello stanley, quakes, + other gurus,
Do you know how they will project out exchange rates 5 years from now in the FCU PEA? For example, $70USD/lb is close to $89CDN/lb today. Considering the ease of mining associated with FCU, doesn't it seem reasonable that an FCU sale price should be much greater than $12CDN/lb in the ground?
Also, I realise that FCU is not currently interested in mining the U3O8. Do you think there is a break point where the amount of lbs in the ground combined with the contract price for U3O8 would cause this decision to be reversed? Mining expertise can be bought or hired for much much less than the billions lost in a triple R property sale.at $12 (or less) per lb.
I realise that the standard response will be that FCU will be bought before any decision like this comes to fruition. However, I am not certain. RIO is having trouble with most of its business units. Areva has some problems due to its Uramin acquisition. Cameco has tax problems and may not be a big enough fish to swallow it right now. I read your other post about the reasons why CCO would like to purchase FCU. However, I'm not so sure they can. So - who does that leave? The chinese? Assuming such a deal were to be approved by the Canadian government, they could only own part of the property. I guess that's why a JV is more likely. Anyways, despite how great this find is, perhaps FCU should consider the mining option just in case. It'll send some shockwaves in the market anyways.