RE:RE:Short term revenueHi guys, Probably none of you know me here, I've never posted on FCC board before... in fact I haven't posted on stockhouse in years, but I've been compelled to come out of hiding for this one. Apparently my reputation is back at 0 cause it's been so long. Anyways... I work in the mining engineering industry, trade-off studies, economical assessments, feasibility studies, etc. I came across FCC a few years ago when I was working on a study for another cobalt miner in the Idaho cobalt belt, and FCC's name came up a number of times as they were competitors. Investigating them and their fundamentals I thought they would be a good investment. Investing the other one would be insider trading for me, so FCC was a good way for me to get into a cobalt play legally. That was when they were 94 cents, I bought, I've bought a few times on the way down, and have now averaged out at 22 cents, and hope to do one more purchase in the next week or so to bring it to about 16 cents.
This is my take on the matter of feedstock from the Cobalt mines in Ontario. It's not a good idea at this time, FCC is doing the right thing right now, and this is why:
- Glencore wants an off-take agreement in exchange for their funding of the restart and their providing the feedstock. If FCC were to use their own feedstock Glencore wouldn't be receiving royalties for providing feed, and in turn, may not provide funding. Having Glencore on board is super important, so do the re-start according to their terms. I work on a lot of studies for juniors over the years, and a key to their success is validation from majors. If they have backing or % ownership from majors the project usually progresses pretty steady. If they are funding themselves, and have to do PP's and generate new enthusuasm, every milestone takes time, and the thing gets shelved for a year at a time, all the while the share price erodes. Big money behind FCC can keep it moving steadily and the share price won't have time to lose 80% in limbo periods.
- The other study I was on in the Idaho cobalt belt- the client eventually ended up deciding a Roasting process was best suited to the high arsenic ore that is common with cobalt bearing ore in North America. It's likely true of FCC's assets in Idaho, possibly of their tailings piles in Ontario. If they're high in arsenic there is stringent environmental guidelines for processing, and based on that last study perhaps a roasting circuit is the best way to treat the ore. FCC's refinery doesn't have a roaster, it's a pretty major piece of equipment and ancillary support equipment. They are taking feedstock that can actually be successfully processed by their existing plant, using it to generate cash flow. Perhaps with that cash in the future they build a circuit on the mill that can process arsenic ores and then they turn to their own, almost infinite feed source.
- Just my thoughts, I may be totally wrong on the reasons.
- Just offering my thoughts, not looking to be a constant feature on this board, just a cheerleader from the sidelines.
Thanks all, and all the best. This is a keeper.