TKO building value (NGX going downhill)NGX, they don’t have a working mine with a 20 year plus mine life. That their major project that generates the majority of their cash flow has only one more decent year left in it. They have all kinds of reoccurring power problems, operational problems, they will have great cash flow projection for the fourth quarter however a lot of small projects.
TKO has a mine with a production capacity of 180 million lbs a year, and 4.5 million lbs of moly. This is open pit and not underground, mine operation costs continue to go down as they are making operational an asset with greater then a 20 year mine life. Look at Quadra, their mine life is a lot less than 10 years and they have a skarn deposit, one other small mine in Nevada, and no other project that will be brought into production in the for seeable future.
TKO
There are additional resources, high grade resources with the new property that they purchased adjacent to the current pit, significant upside and just can’t wait to see the drilling results, perhaps management will change the mine plan and show us the way to 250 million lbs of copper a year. Once they get all their plumbing issues addressed.
The prosperity project really needs the political will to move it forward, write you Member of Parliament I have and I did get a response which I posted here.
It is too bad if prosperity was in Ontario or Quebec we would be building the mine as we speak. The stock is currently trading at a value that would hardly replace the existing mine infrastructure never mind the resource.
This is a buying opportunity for TKO shareholders and the way I look at it is this, if they were building a mine that was to produce 180 million lbs of copper a year, it would take them a number of years and you would have no cash flow during the entire development process, however you may have the same share price because they don’t have to report regarding small operational setbacks while they are building the mine.
It seems to me that they are still having problems in their moly recovery, that a lot of modernization is still ongoing with new shovels and conveyor systems, these will take some time to optimize. The United States is slowing down however the rest of the world is not; don’t expect a total collapse in metal prices.
With TKO we have to look past single quarter results and recognize it as a mine in reconstruction and factor this progress into the quarterly results. Also recognize that they have 3 significant projects in the hopper that I know about that could be material to someone with the capital and time to wait them out in terms of development. If they can execute and significantly lower their cost of production they are definitely in play simply based on future project opportunities. How many companies with 12 million oz of gold projects exist? Some in the Yukon; however have they got any permit and where are they in the process?