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RESERVOIR MINERALS INC V.RMC

"Reservoir Minerals Inc is engaged in the acquisition, exploration and development of mineral properties in Serbia, Cameroon, Gabon, Macedonia and Romania."


TSXV:RMC - Post by User

Post by psj567on Jul 26, 2015 5:06pm
195 Views
Post# 23961306

Freeport's Drastic Loss of Market Cap Is RMC's Gain

Freeport's Drastic Loss of Market Cap Is RMC's GainFreeport now has a market cap of about $13 billion and net debt of about $20 billion (both in US$). There has to be several mid- and large producers who would love to own RMC's Timok JV interest, and then negotiate with Freeport in its weakened financial position to acquire the majority interest in the project and become the operator. The Freeport/RMC Timok Project is the only viable development project in the copper space currently. Because the mine's capex would be paid in full by mine operations, and at a later date when copper prices have recovered, this is a very attractive opportunity for any seasoned production team in the copper space. It all depends on how badly Freeport wants to keep Timok as a future producing mine. Freeport is certainly going to have to shed more assets in the near term. This is especially so as its planned IPO for its oil and gas business likely will never get off the ground in this market. While I would love to see RMC acquire Freeport's entire interest in the Timok JV, I just think it is more likely that a third party will acquire RMC and then leverage Freeport's weakened financial position to its benefit. It tells you how much Freeport values Timok when it continues to develop the project--- the only greenfield development funds it is expending in the world this year.
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