copley sa (mt coffin) and lee creek copper, page-16

Seeing as we talking about this subject.

http://www.adelaidenow.com.au/business/phoenix-copper-buys-copper-mine-at-leigh-creek-in-south-australia-to-turn-producer/story-e6frede3-1225874976377

Phoenix Copper buys copper mine at Leigh Creek in South Australia to turn producer

PHOENIX Copper has bought a copper mine near Leigh Creek, transforming the company from explorer to producer.

The Adelaide company will pay $1.25 million in cash and 6.25 million shares for Leigh Creek Copper Mining, including its Mountain of Light copper operation.

The mine has been on care and maintenance for about 18 months, and Phoenix hopes to have the heap leach operation up and running again in three months.

The acquisition is forecast to turn Phoenix into a profitable company next year.

Forecast consolidated revenue for 2011 is $4.45 million increasing to $11.2 million in 2012.

"The consolidated profit forecast for 2011 is $270,000, increasing to $2.4 million in 2012. This compares with a projected loss of $430,000 this year.

The valuation of LCCM is based on the Mountain of Light operation, and does not take into account the two other mining leases of Lorna Doone and Lynda.

Phoenix managing director Paul Dowd said the current mine had an expected life of three and a half years, but the company would naturally be looking for more resources in the area.

"What we really want to do is recommence operations at Mountain of Light, start the receipts rolling through there, consolidate, then ... move up to Lorna Doone and then hopefully we'd then be blending two cash streams together, which we're not reporting on at this stage, but that's the ultimate aim," Mr Dowd said.

"There's been virtually no modern exploration for extension of the resources in that area and that's one of the first things that we want to do when we get a regular cashflow, is to look around the current deposits to see if we can increase that.

"I don't have any information that would make me confident or otherwise at this stage."

Phoenix will fund the acquisition through a share purchase plan under which shareholders can buy up to $15,000 worth of new shares at 16c per share.

The deal is expected to be finalised by early August, following shareholder approval.

Phoenix's other assets include a series of exploration leases surrounding the historic Burra copper mining region, where the company expects to publish a resource by the end of the year.