Katanga Mining Ltd Ord KATFF

Copper and Cobalt Reserve and resource of KCC mine

[Sogosohubidu201]

KCC mine has 4.85 million tonnes of copper reserve, but KCC has 16.57 million tonnes of copper resource and 2.27 million tonnes of cobalt resource per KAT March 2018 technical report as listed below:

(1) Measured and Indicated Resource: 283.5 Million Tonnes x 3.6% copper = 10.21 Million Tonnes of Copper.
(2) Inferred Resource: 167.8 Million Tonnes x 3.79% copper = 6.36 Million Tonnes of Copper.

Total Copper Resources of 10.21 + 6.36 = 16.57 Millions Tonnes of Copper

KCC has 2.27 million tonnes of cobalt resource:

(1) Measured and Indicated Resource: 283.5 Million Tonnes x 0.54% cobalt = 1.53 Million Tonnes of Cobalt.
(2) Inferred Resource: 167.8 Million Tonnes x 0.44% cobalt = 0.74 Million Tonne of Cobalt.

Total Cobalt Resources of 1.53 + 0.74 = 2.27 Million Tonnes of Cobalt.

Based on the copper and cobalt total resources and 300K tonnes of copper and 40K tonnes of cobalt annual production, KCC mine will last for 45-50 years.  Based on the copper reserve, yes, it is about 18 years of production.  The copper reserve number should be moving higher with the future update together with the increase in copper and cobalt prices.

This is one of the best copper and cobalt mines on this planet in terms of grade and resource.

[topdop]

... a timely reminder for those that didn't know already. Thanks @Sogosohubidu201 Actually, I believe KOV to be the best producing Cu & Co mine ANYWHERE currently ramping up to full production. Care to calculate cashflows? Account for credits? And to apply a conservative P:E? 300kt Cu/y @ $6,400/t and 40kt Co/y @ $55k/t? As others have stated - and I agree - these are the metrices that

[Sogosohubidu201]

Thanks topdop. Sure, I will do a simple and short piece per your suggestions next week when I find some time.

[topdop]

Good one Nelson. I think we timed discussing then you publishing your "back of napkin valuation noodling" with very good timing. I prodded you with good reason. I wanted folks to be reminded of the hidden value here again as I determined, frankly, that most would have been scared witless over the past 3 months, particularly and all the while, we were still buying - me at 46c, then 44c

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[Sogosohubidu201]

Thanks topdop.  We are entering the process of EV revolution, which is 100 years' event. This is followed by green energy revolution. All will require a large amount of copper short, medium and long terms as well as cobalt short and medium terms at least. The growth of EV is very impressive. China sold 1.26 million new energy cars with close to 1 million pure EV, 4.4% of the market share

[Lech1988]

What credits does KAT currently have? And they are able to apply them only to a certain % of taxable profits on any given year right?

[Sogosohubidu201]

There are over $4 billions USD of tax loss credits carry forward for Katanga Mining.  The tax credits can be applied to 60% of taxable income per year until the credits are used up if I remember it correctly.  It is in the 2017 annual report.

[Lech1988]

And the new tax code doesn't impact the size/value of the credit or how it can be used?

[Sogosohubidu201]

New mining code does not eliminate the tax credits.  60% income per year does not need to pay tax, which is still applied until over $4 billion dollars of credits are used up.

[Lech1988]

Ok that is good to know, thank you. 

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