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clock Created with Sketch. 03/08/14
20:46
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Originally posted by BLOG
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Hi All, IMO! Looks like RXM might , at last, be on the move upwards. It's been a very frustrating time , Rex hasn't benefited from the absurdly overzealous bureaucracy, sometimes I wonder whether it's worth the angst? But now the portents look decidedly brighter. What is RXM worth ? Although RXM is no SRF, ( The absolute "gold standard" among the Oz copper deposits IMO) RXM should nevertheless be worth more than 42.5 cents per share. How much more? We await the critical BFS in order to make a more accurate appraisal. At present all estimates are nothing more than inspired guesses. I am assuming that Hillside will go ahead, which means the mine will be financed somehow. Still isn't a certainty but looking more promising now! I base my wild guesstimate on the following. SFR has a M.C.of $983m and RXM a M.C. of $94m. SFR is a VMS deposit ,grading 5.6% Cu and 1.8gAu/t ,has about 8years of resource remaining but is now an underground mine. The high grade open cut source has been mined out. Clearly with a 30km.long and 2km. wide prospective sequence of geologically similar rocks under shallow cover the chances of finding additional shallow De Grussa type bodies is good, particularly as the potential targets are responsive to airborne E.M.methods and VMS deposits often occur in clusters. The negatives are that De Grussa is isolated and therefore distant from market, suffers from high labour costs (FIFO) associated with underground mining, and is depleting its resource. RXM is not a VMS high grade deposit. The copper appears to be emplaced in faulted structures along the Ardrossan Fault line. The quoted mineral resource is 337mt.@ 0.9% Cu eq, the mineral resource is 180 mt @0.9% Cu eq. A largish low grade resource but amenable to open cut mining. RXM 's advantages are its proximity to cheaper labour (No FIFO nonsense) ,ideally located with all the advantages especially the short haul to the port. RXM is considered a long term open cut and maybe eventually an underground mine too. The exploration potential of Rex's Y.P. areas are dependent more on airborne mag. than airborne E.M. they are therefore more dependent on structural interpretation. I guesstimate (and it is a guesstimate only!) SFR is probably worth 3 times the value of RXM. If SRF is fair value then RXM should have a M.C. of $300+m. valuing RMX at $1.50+ Just an opinion! BOLTA!
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I'm only looking to make circa 50% so haven't gone to the trouble but while awaiting the feasability study, another simple valuation method is to simply compare Rex on an IGV basis. Not hard to compare to peers at similar stage and go back see what mc more progressed coys were trading at at Rex's current stage, taking into account respective copper prices.
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