nickbillfish wrote: edmed wrote: how can you call this an over reaction
the whole company is shutting down operations and letting the workers go
no money coming in
warning about not being able to pay creditors??
what future does this company have??
thoughts?
I guess I'm the lone contrarian here. There is value here, I upped my stake, this CEO always seems to panick and appears nervous. Likeable guy but he folds like a house of cards. I'm holding hope the Board and larger shareholders salvage this because:
1. They had completed the block cave construction. Supposedly there are 101 Million pounds at 85% proven, not probable reserves, a grade of 1.51%. In block caving all the Capex is in construction which is done. Projected cost was $1.66/lb, so at todays copper price that's $2.80/lb but unlikely we will get that but Papomono can pay off the $70 Million debt.
2. The block caving will ramp up to 2,000 tons per day of ore to go into a working 7,000 ton per day crusher, then onto an upgraded cathode plant with newly installed salt leaching that can produce annually 18,000 tones of copper cathode.
3. They have 46,000 hectares of land with numerous targets and a newly identified prophery which hopefully was true. Also pretty much the entire profit from Papomono will be shielded by the $270M+ in tax loss carryforwards.
4. This mine is very important to the local town, the large debt holders Anglo and Kimura terrified to go into a Chile bankruptcy court in this political climate. Hence I believe a quick solution will be found.
5. Again the capex to operate Papomono is maybe 5-10 M more on top of the $7M they have. Don Gabriel was to wind down anyways.
6. This is a working mine, with a freshly constructed block caving project and over $300 Million in todays dollars have been spent. Plus the block caving is environmentally friendly.
Guess I'll fall on my sword, but the majority of shareholders folded like a house of cards too. Nearly 40 Million shares have traded the past 3 days. Sure some flipping for the .005 gain between .035 and .04. Unless this is some fabulous con job, there is value here. Just hope the Board and largest shareholders who are really smart people create the value.