FCC Business PlanAs FCC continues to drill and determine what it has at Iron Creek and at the Cobalt Camp, it is increasing its value as the results to date have been good. However, to get a significant increase in SP it needs a favourable off-take agreement.
To get the off-take agreement it needs to have the ability to produce saleable Cobalt commencing within 2-3 years. To do that it needs a mill. It has one, but it is not operational and it is too small. To get operational and expanded it needs $70-80 M per an earlier Trent interview. Where will FCC find the $70-80 M.
Bank financing? If Iron Creek mine production is 3-4 years out, how can FCC get bank financing to get the mill running? It can only do so if it is able to get ore to process shortly after the mill is operational by processing its Cobalt Camp much piles, but is that enough. if not, are there other Cobalt Camp properties with muck piles or operating mines with sufficient Cobalt concentration, and if so, can FCC make favorable deals on a timely basis so that FCC can become profitable. It will need profits to be able to make loan payments.
Would a merger help? Maybe. Another company could provide the cash infusion needed. eCobalt would be a reasonable merger partner since it is close and fits the North American conflict free Cobalt approach, but it has limited cash and what it has is being used to build its own mill and mine. It needs a cash infusion too.
Could an FCC + eCobalt merger create the needed mass to get an off-take agreement? If not, FCC is probale looking at a merger with a larger out-of-the-area merger.
An off-take deal could provide FCC with up-front cash to be used to repair and expand the mill to get production going, but again, how much Cobalt is in the muck piles and how much money will First Cobalt need to get the an Iron Creek mine operational to feed the expanded mill once the muck piles are used up.
An offtake agreement with a merger of FCC and eCobalt may be more feasible in that there would be onsiderably more future production so that a buyer of North American, conflict -free cobalt, would be interested.
Whatis the business plan?