Stuhini Exploration Ltd. V.STU

Re: Stuhini increase in private placement to $1.38 million

[Tad]

Not surprised that Stuhini has announced they're more than doubling the size of the private placement.

Molybdenum price has been rising steadily the past month.

As of Dec 15 the 2 to 15 month contracts are quoted at US$26.47 / lb and the 1 month contract is US$25.45 / lb.

https://www.lme.com/en/Metals/EV/LME-Molybdenum-Platts#Trading+day+summary



Reviewing some previous calculations  .....

The in situ value of Stuhini's Ruby Creek moly deposit is now worth :

US$26.47 / lb X $1.355 exchange rate X 478 million lbs MM&I resource = C$17,144,354,300


Before the credit crisis in 2008, the previous operator of Ruby Creek, Adanac Moly Corp, had a market cap in excess of $250 million dollars and had secured a $600 million credit facility for construction of a processing plant. After the credit crisis and collapse of moly prices, Adanac went into bankruptcy. One of the co-founders of Stuhini purchased the project and it was vended into Stuhini in 2019. There are two option payments remaining in Dec 2022 and Dec 2023.

As previously posted on this forum, there is a recent pure moly deposit acquisition that could be used as a good barometer for what a company may pay for a pure moly deposit :


Zijin MIning acquired the Shapinggou moly deposit in China, the world's largest pure molybdenum deposit, in October 2022.

https://www1.hkexnews.hk/listedco/listconews/sehk/2022/1023/2022102300035.pdf

See the chart on page 4 for a break down on the actual numbers of the Shapinggou moly deposit.

Shapinggou holds 1.63 billion tonnes of ore at an average grade of 0.143% for 2,338,000 tonnes of metal, which includes 165 million tonnes at an average grade of 0.38% for 630,000 tonnes with a cut off of 0.30%.

5.91 Billion rmb / 7.1 rmb: USD = US$832,394,366
US$832,394,366 X $1.33 = CDN$1.1 billion

US$832,394,366 / 2,338,000 tonnes = US$356/tonne / 2220 = $0.16/lb
CDN$1.1 Billion / 2,338,000 tonnes = CDN$473.5/tonne / 2200 = $0.215/lb

The overall price per pound for the Shapinggou acquisition of 2,338,000 tonnes of moly works out to around US$0.16/lb or roughly cdn$0.215/lb .


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CDN$0.215/lb would equate to just over CDN$102 million for the pit constrained estimated 478 million lb ruby creek moly deposit.


The Shapinggou moly deposit will be an underground operation, whereas, Ruby Creek is an open pittable deposit which would have lower mining costs.


Prior to the current private placement announcement Stuhini had 30,667,911 shares issued and outstanding, and 2,260,066 warrants exercisable at $0.60 with an expiry date of August 2024.


If the current financing is fully subscribed the share structure will look something like this :

30,667,911 + 6,000,000 shares @ $0.23 + 1,750,000 Dec 2022 option payment = 38,417,911 shares O/S


There is also one final option payment for the Ruby Creek project due in December 2023 for $600,000 and 1,750,000 shares which would bring the total shares issued to approx. 40,167,911 shares.


There would also be 2,260,066 warrants @ $0.60 and 3,000,000 shares @ $0.35.


Stuhini would still have under 50 million shares issued and outstanding, if all warrants were exercised for cash proceeds of approx $2,406,000.






GLTA !

[Notyoursheep]

Great summary, I can't wait to see what the next  year holds for this company. Hopefully the tight share structure will pay off for all the longs.