RE:RE:RE:RE:RE:RE:RE:Cu and - Zn is the appeal -- for suitors thorgb1,
I do not have the details of the boardroom deals that are made, and I am sure you don't either. What I do know; however, is what is available to the public. Having said this, this is what I know...
Based on the original JV agreement (Freeport "Earn-in") "
No further funding was required by Reservoir until delivery of a Bankable Feasibility Study (BFS) by Freeport"...
Now this is the hard part, because unlike yourself and Rob926, I was not an shareholder of Reservoir and really did not know much about them until mid-2016....The Right of First Offer
ROFO changed the structure the Timok JV ownership where Reservoir gets 100% of the UZ and the Lower Zone is divided in ownership; where, Reservoir (now Nevsun) owns 60.4% with Freeport-McMoRan Exploration Corporation (Freeport) holding the remaining 39.6%. Upon completion of a feasibility study, Nevsun will indirectly own 46% of the Lower Zone and Freeport will indirectly own 54%...But here is the hook, Nevsun needs to fund $20M
before Freeport has to complete their "Earn-in" portion to bring their ownership to 64%. So please re-read my response...
"It costs them nothing and allows NSU to do some earn-in work." Freeport was in financial dissarray, so they somehow got a financial repreive and will have an opportunity to get a "free" look (or better look) at the LZ before deciding to
commit to this project further.
and meanwhile back at the ranch... My comment(s) "Althought the grade appear good; it
may be technically not feasible to mine via caving methods because of the depth of the deposit (>1000 meters below sea level
and >1400m below surface) due to excessive stress and the technical challenges caving at theses depths."
Did you review the caving information provided? I am trying to benchmark Timok against other caving operations around the world to compare their extraction level depths to the potential final depth of extraction at the Timok LZ.
Timok would be the deepest block caving operation (below sea level) and the deepest blind caving operation anywhere on this planet. With this information and with some personal information on mining I am suggesting that the Lower Zone is technically challenged below the stated depths of >1000 meters below sea level and >1400m below surface.
What have contributed to this discusson?
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Apologies for the delay, I've had 2 days of driving dropping kids off at camps around Ontario.
In regards to your first point, I'm sure what is different. There is still no earn-in for NSU on the LZ. Period. They only stand to lose a further 15% when further exploration occurs. 420M doesn't go very far when drilling deep holes, so I'm not sure they will learn very much more from the any further drilling NSU might do in the interim. I believe that FCX has a very good understanding of the porphyry, and structured the deal in a manner that allows them to remain in control of the LZ which will result in a long life, Freeport sized mine. The only question remaining is how big the porphyry is, as current drilling shows it to be open in 2 directions, and if any other high grade deposits exist on top of it. Timok is a discovery like none other in recent times, great grades, a massive deposit and infrastructure already in place. I can't believe anybody would suggest NSU overpaid for it. It is still my belief that LUN will end up with it, because anecdotally I've heard that Lukas still wants it.
In regards to depth, I've had dozens of discussions with the RMC geo's, and never once did they seem concerned by this. On the contrary, they seemed to believe that the fact that the LZ would be a sub level caving operation might make them more attractive to mid tier operators, as they would want to watch and learn from Freeport as to how to extract the ore. Grade was the only concern, but that went away when the assays were coming back at better then 0.5% CuAu equivalent. Though FCX keeps it close to the vest, it is my understanding that 0.4% is their cutoff for a profitable block cave operation, but even that might be reduced in Central Europe rather then the jungles of Indonesia or in the Congo.