Afternoon Guys,In regards to volley17's comments above, I have...

Afternoon Guys,

In regards to volley17's comments above, I have just completed an exercise with Sprott where we were looking for (more) investment opportunities within the Cu sector.

For anyone who has watched a presentation by Kolanovic (Copperbank Resources) you'll know that there are only c. 12 Cu mines that are producing the majority of the World's copper. These are all grand old girls with various issues such as deteriorating grades and increased costs due to depth, etc. (soon to be joined by Ivanhoe's DRC Kamoa Kakula).

Whilst we will all have different investment rules, the outcome for me was that there wasn't a single porphyry project that I would invest in. Most have some form of compromised status, most of which surrounded some type of jurisdictional risk but also, in some cases, included suboptimal deposit characteristics.

The conclusion we came up with is that the best opportunities in the sector come from the VMS deposits and whilst these won't produce the same 100+ year mines, given the market we are now in (again we all have different opinions on this) these will produce the best returns for investors in terms of IRRs, capex, time to production, etc.

These are often smaller companies however which won't attract a TO from a major but could readily attract a mid tier predator. However, these also have all the issues of smaller, single mine / project companies too. Thus, my approach is to have a stable of these VMS deposits that have all passed the Sprott screen, each with a smaller position size but in aggregate provide a decent portfolio allocation to the sector.

NWC is one of the larger stable mates.

These two pieces from Mark Thompson (well worth following) are interesting:





Cheers
John