What is BKM worth?There is a "Working Model" used by Pacific Booker, in which one can plug in mineral prices, ore recovery %, rate of return, cost to build the mine, fuel costs etc.
The expense estimates are 10 years old and so will probably be a bit higher, even though fuel and energy prices maybe lower than when they put this cash flow model together.
I get a near zero present value of only $2 million when I use the following ore prices, discount rate of return and ore recovery.
Copper... $1.60 USD ... recovery 90%
Gold........ $600 USD ... recovery 74%
Moly....... $12 USD .... recovery 50%
Silver .... $7 USD .... recovery 74%
Canadian dollar 80 cents to the US dollar
Discount rate of return 5%
I do not expect to ever see mineral prices this low again. This is especially true for copper, as current projections seem to indicate a potentially severe shortage of copper.
Anything above the prices above should be profit.
I understand that we expect to recover approx 1.4 billion pounds of copper.
Today's prices are:
copper $4.23 USD
gold $1733 USD
moly $12 ?
silver $26.85
Using today's ore prices the working model gives a value of:
$3.459 Billion = $170 per share with only 20 million shares fully diluted.
This makes sense if we understand the extra money just from copper:
$2.63 USD ($4.23 today's price- $1.60 breakeven price) x 1.4 billion pounds of copper = $3.682 Billion USD
This is equal to an extra $4.655 Billion Canadian
Thus, at todays prices, just on copper alone, we will receive $4.655 Billion more Canadian over the life of the mine.
Of course $4.655 billion over the 20+ year life of the mine, means that this number needs to be discounted to determine today's value. Still, it is easy to see why the shares are potentially worth so much more. Of course we need to receive the provincial permit before we can even consider such a value. That said, it is nice to know what the potential is.