Food for thought, and an opportunity for reflection on the last 12-15 months and to reiterate why Cyprium is a screaming buy amongst economic pressures of the world.
Cyprium raised $90m in the past when it's market cap was less than 20m if you consider it had $5.4m in cash. Can't think of many companies that have completed such a significant raise with a market cap that small.
It also meant we haven't had to raise money again from ownership, up until now, where we are financing the build - which is mostly a refurb of existing infrastructure.
This was an equity component that was multi faceted with convertible notes etc which minimalized dilution at the time of the raise and was in the best interest of shareholders...
Although we don't have an idea of terms yet, we can atleast go by past experiences. We have all seen those companies that tirelessly raise and don't get the work done, whether it's not on time or not at all. I wouldn't underestimate the ability of Cyprium to raise funds via debt. The initial raise was essential for the sale and purchase of the MLX copper assets, working out to be only 60c per lb.
Looking ahead Cyprium is a 90m market cap company and has made significant progress. They have completed a restart study to a BFS standard in less than 12months of owning the project. Also containing a huge resource of another tenement, Maroochydore. As well as a JV with IGO.
"IGO is to sole fund A$32 million of exploration activities over 6.5 years to earn a 70% interest in the Paterson Exploration Project, including a minimum expenditure of A$11 million over the first 3.5 years. Upon earning a 70% interest, the Joint Venture will form and IGO will free-carry Paterson Copper to the completion of a Pre-feasibility Study (PFS) on a new mineral discovery."This works out to be 0.03c per lb for 32 million dollars of exploration expenditure!
I see no reason why an equity raise at these prices should happen when the value is so clearly laid out.
Cyprium will be mining in 2023 making over $110 million dollars per annum of free cash flow at a copper price of $10,000 per tonne. For one of its 3 projects that are shaping up to be economically viable - With an added bonus if IGO find a huge orebody in the meantime.
Over the last 12 or so months have a look at how the strategy has been executed - this does not include producing a resource estimate followed by another coming shortly, not including over 13,000m of exploration drilling sp does not include sonic drilling and sterilization drilling, metallurgical test work.
Peer ComparisonI watched the recent small caps interview of
Stavely Minerals for a comparison.
Stavely has a market cap of 100m and shares on issue are only 260m so they have run themselves on an oily rag since they IPOs'd in 2014.
Cyprium 90m market cap. But fully diluted they have a market cap of 104.67M.
Take away the cash that the remaing options would bring in $7,206,500
and
Cyprium has a market cap as of today, 97.4 MillionThis includes 6 million options,
57M in performance shares
the remaining 20.3M options exercised at $0.355 and at the highest bracket (1.3 shares for every option if the copper price is over $9000t)
They are nowhere development and are commanding a very similar market cap.
After 8 years since IPO, Stavely doesn't have an inital resource estimate - due this June quarter. They don't even have a scoping study also due this quarter but as scoping studies it will be missing a lot of the robust information/factors included in the CYM restart study.
Some are estimating the intial resource estimate will come in at 200kt of copper (bearish) to 400kt (bullish). The scoping study to be released will be concentrator operation
Stavely is a regional play they have good prospects but the timeframe for development is a long way away. However, the resource is fantastic at Cayley lode with multiple long high grade intersections.
To give you an example of the timeline comparison though. They expect
permitting at their Victoria tenement to take
2.5 to 4 YEARS. They have a tailings dam to design and construct (CYM has one but don't need it unless they cannot leach the sulphide). energy concerns (cyprium has a gas power plant) They also need a processing plant as their deposit has gold and also silver. Not to mention the upfront cost of a concentrator.
Not to mention a DFS which may take one year. The time it would take to construct for Stavely would be significant probably adding another 2 years.
Both are developing a phase one operation. The MD of stavely has hinted at a capex of 200-300m which I think is off the mark and unrealistic, i think the scoping study will show it's closer to 350-450m. Cyprium's capex is 149m and has a lot of existing infrastructure.
Stavely looking to develop a phase 2 underground after phase one is in production. The underground that they will mine down the track, will need the resource better defined..
It is deep so will require expensive drilling to depth. They also have problems drilling through the saline water table as they drill down which I think is at open pit depth and has been a problem for them to constrain as they have to remove it off site.
Both deposits will have a significant mine life.
Stavely in my opinion from that recent video is hoping for a takeover. CYM on the other hand has dreams of becoming a mid-tier copper producer.
Stavely's value comes from it being a regional play. it has a large land holding and is continuing geophysics then field work, auger and aircore drilling over the 19 regional prospects found from the last program.
Stavely has another VMS resource which contains a small amount of copper and is high grade and open at depth with a tiny bit of gold, currently drilled to 250m and open at depth. It has a resource of 1.3mt at 2.0% copper for 26,000t of Cu.
Cyprium's Hollandaire on the other hand is far superior Total 2.7mt at 1.90% Cu for 51,500 contained copper 28,800oz's of gold and 574,000ozs of silver.
The regional play and it's high grade copper carry a lot of weight. But, I see the market cap of Stavely going no where fast over the next couple of years while CYM will start to make significant cash. Some poster's on their thread are spruiking it will go to $2 a share. the share price as of now is 39c.
The MD of Stavely gave some thoughts on copper price. Suggesting that from now until 2050, the world will need 10 Escondida's mines, which is by far the biggest in the world, just to satisfy copper demand.
He also states that a copper price of $25,000 per ton is not out of the question but doesn't say when, so let's assume it's by 2050. Huge. Keep in mind that lower grade deposits will come online, and cut-offs will be lower. They development process is very long winded for a copper mine and Cyprium own the 2 of the top 30 copper deposits in the world.
I'm not sure why the market is valuing a less risky (numbers are out and are great) Cyprium at 90 million market cap, who will producing a premium grade copper cathode in an environmentally friendly way. Who would also save an insane amount on diesel costs, smelters and shipping... Compared to a company without an inital resource estimate, no studies, not enough resource definition for the phase 2 and a project that I can't see in production before 2028!
CYM yet to see any value for its additional 2 mines that will go in development and it's regional patterson JV with IGO..
We are continually mispriced by the market. Everyone is saying there is no copper plays coming online in the near term. Well hello, here we are, and one day we will get noticed.
The pricing of this stock assumes a low capital raise and no debt funding and even then we wouldn't be overvalued but that I'm very optimistic would never occur.
My sentiment remains as Buy and I bought more at 16c. Incredible value.
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