Incredible to think that copper is circa 4.60 and we are yet to...

Incredible to think that copper is circa 4.60 and we are yet to go on a decent share price run here. I have noticed the supply side starting to dry up though so buyers will have to start paying up if they want stock here. Given that we have had multiple approaches to sell the oracle ridge project and where copper prices sit at the moment, I am surprised anyone is selling but each to their own. I am a patient value investor and don’t mind sitting on my hands and feet when I have found a good stock with someone like Charlie steering our destiny.

I am glad I got my fill in the low to mid 4 cent range. I am pretty happy that I have an average cost base of 5.2 cents but it has taken some hard work averaging down to get to that position. I now have a lot more capital tied up here at 1.8 million shares but definitely comfortable with my position.

I am comfortable because I know Charlie isn’t going to give this project away, he has close to 20% stake here which is what you call a blocking stake, we can’t be cheaply taken over. If you want the whole show you have to go through him, which means pay up or piss off. I will share in a separate post the money that he has tipped in over the last few years to demonstrate why he isn’t giving this project away cheaply.

I conservatively think we are worth between the range of 15-25 cents per share. I come up with this pricing observation based on a couple of different ways. I compare us with Carnaby resources (a similar sized deposit in a similar jurisdiction from a mining perspective - infrastructure and risk appetite etc) is currently being valued at about 73 million by the market which includes circa 10 mil cash so call it 60 million for the deposit itself - effectively 3 x more than our enterprise value give or take, obviously using round numbers here for illustration and hence how I come up with 15 cents per share at the lower end of the pricing point. You could argue that someone would have to pay more than 73 million to secure that deposit as well but it just shows you the upside here even at the lower end of the scale.

A yard stick that I have seen other mining companies sell their entire deposit for is $3.00/$4.00 per million tonne, a respected mining guru/billionaire Mark Creasy parted ways with his company CZR (Iron Ore deposit) for around this valuation range. We have 100% ownership here and 28mt so call it 30 so 90 million should be a reasonable ask price which is 4 to 5 times more than what our share price is today 20-25 cents. Call me crazy but this is just my opinion and why I continue to buy. It will be a cold winter if I am wrong so let’s hope I am not. Cheers, CP.