RE:RE:RE:RE:RE:RE:Another Take on Copper"What is the potential risk?"
For me the risks is something like 2008 financial crisis that causes the price of copper to go down. If something like this does not happen, then I am not worried about any other risks.
Drilling risk? The deposit already has 100 holes that proved a lot of copper. The deposit already proved postiive NPV when copper prices were much lower. So infill drilling will confirm what we already know and better. This is not like we just have some land and we want to drill to find out what is there. We already have a monster deposit.
Funding risk? Oroco will raise money with no problem. Funds are too greedy not to want to make easy money on this one.
Buyout risk? Picture Pamela Anderson walking into a bar in her prime and not having even one man look at her. Not a chance. Now picture Santo Tomas with $2 to $4 billion NPV, 43-101, and feasibility study all up to date. No major will be interested? Not a chance. Santo Tomas WILL be bought out. The only unknown is when and for how much. Like I said before, the more the majors wait, the higher the price.
They could have tried to buy Santo Tomas before the legals for maybe $200 million. They didn't. Now, the price is higher.
They could have tried to buy Santo Tomas before the registration for maybe $300 million. They didn't. Now the price is higher.
They could try to buy Santo Tomas for $400 million right now, but they won't. Why buy it now if they can pay more later.
So when Oroco raises money and starts drilling and reporting good numbers, the price will go up again. If the majors allow Oroco to complete all the drilling which will lead to new 43-101 and feasibility study, then the price will reach $1 billion or more.
So as you can see, the buyout will depend how long the majors will keep sucking on their thumbs. For us, the longer they do the better.