jump or ride?, page-3

mncmeup,

Those are the comments of a bear on another forum:

http://www.lse.co.uk/SharePrice.asp?shareprice=MNC

It raises valid points: low grade and depth of the resource which have been raised here before.

In my opinion the key to unlocking the value at Los Calatos is developing a smaller, higher grade starter pit that would pay for the infrastructure. The company has certainly identified this and is focusing on the breccia zone and has stopped drilling those terribly deep and expensive holes.

A few exploration results to remember are:

CD-25: From 192m to 617m - 425m @ 0.52%Cu 1360ppm Mo
CD-31: From 125m to 262m - 137m @ 2.79%Cu 520ppm Mo
CD-64: From 245m to 391m - 46m @ 0.51%Cu 37ppm Mo
CD-64: From 494m to 557m - 63m @ 1.07%Cu 565ppm Mo
CD-83: From 171m to 353m - 182m @ 0.46%Cu 176ppm Mo
CD-85: From 295m to 366m - 71m @ 0.38%Cu 166ppm Mo

If we can define a resource of say 300MT @ 0.55%Cu and 250ppm Mo I reckon we can have a stage 1 operation running 20 MTpa through a concentrator (~55,000 tad capacity) and producing close to 400,000 tpa of concentrate at 25%Cu

With CAPEX for such infrastructure at $1billion and an profit margin of $2,500 per tonne of Contained copper, the NPV and IRR would be very healthy.

So, the next resource statement is one where I expect MNC to provide detail about size of each zone of the orebody (breccia, diatreme, porphyry) so that analysts (and large copper mining companies) can start getting their view on the profitability of a smaller stage 1 project.

With regards to share price catalysts other than the new resource statement we can probably expect news on either a sale of the Chilean projects, or an off take agreement with a smelter.

Anyway its good to have other views presented and discussed, good pickup.

Alejandro
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DYOR, this is not investment advice
STO, BDR, MNC, HCH