Polymetallic...
In an earlier presentation to investors, Baldock said that TSX-V-listed Monument would pay consultancy Snowden $10-million to conduct a due diligence on Mengapur, which is set to be complete in early November.
The $10-million will also cover the updating of the project’s feasibility study, he said.
The Malaysian government sold it to a private company called Malaco in 1992, after the state decided to focus its resources on the oil and gas sector.
It did so after having spent $40-million on the feasibility study, and Baldock said the $50-million Monument will pay for a 70% stake in Mengapur was “very much a distressed sale price”.
While the mine will largely be a copper project, the historic feasibility study also envisaged production of sulphur, gold, silver, lead, zinc, as well as molybdenum.
According to Baldock, Monument will even consider either sourcing phosphates from another company or acquiring its own resource, with the view to process it with Mengapurs sulphur and manufacture fertilisers, which Malaysia’s world-leading palm oil industry could use.
“We’re out beating the bushes right now,” he commented.
Mengapur will be an openpit mine, with either a 3 000 t/d or 7 000 t/d mill.
“At the moment we’re leaning toward 7 000 t/d,” noted Baldock, who is also the CEO of TSX-listed Yukon-Nevada Gold.
At present prices, he said that there is about $7.5-billion worth of copper at Mengapur.
Based on the 1990 feasibility study’s anticipated 24-year mine life, this would generate yearly revenues of around $312-million at current copper prices, at a production rate of some 78-million pounds a year of the red metal.
Addressing potential investor concerns that a gold company was buying the polymetallic Mengapur project, Baldock said the objective was to diversify into different products, to protect sales in case the gold price declined.
He also said the project was a solid one that would likely deliver big profits, and that investors shouldn’t complain about that.
“I expect none of them will send their dividend cheques back,” Baldock quipped.