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Regarding switching Gunnison to open pit, if that was to occur, that would push Gunnison out at least another five to ten years, IMO. Although Robert seemed to allude that permits were in place to do that (an assertion I question) what will delay an open pit is not only a mine design plan and financing, but having to deal with environmental lawsuits which will surely follow. I hate to say it, but I think EXMGF is dead money, possibly for quite some time. An operating JCM will buy some time and keep the lights on, so to speak, but it's not really a catalyst to drive the stock price higher.
I've been an investor for close to nine years now in EXMGF. Unfortunately, this stock is going nowhere until Gunnison proves out. And that is still years away, in my opinion. The activities at JCM will have no positive effect on the stock price as any meaningful results from the Nuton application is also at least a year or two out. The only real positives are first, establishing the relationship with Rio Tinto and second, the coming worldwide shortage of copper. We are faced with a decision: either get out or load up and hope for the best.
JCM, in my view, is just a side story to Excelsior. It's great that they have this relationship with Rio Tinto which, hopefully, will grow over time and result in Rio taking a JV interest in Gunnison.
I have a feeling something is going to happen soon.
EXMGF showing signs of life. Good news coming?
In case you haven't noticed, there is a new investor presentation on the Excelsior website.
I began accumulating EXMGF in 2015. I'm no geologist, but the geologists at Greenstone, Triple Flag, and Nuton all seem to like Gunnison and JCM. Once the Gunnison well stimulation process proves successful, this is going to rocket in my opinion. The success of reopening JCM hinges on the price of copper. The Excelsior story has always been about whether the in-situ process will work for copper. I think everyone is waiting for the well stimulation to begin. Hopefully Q1 2024.
What is good about the Nuton news is not so much how it relates to JCM although that is good, but having the relationship with Rio Tinto. I have a feeling that Rio is going to be closely watching the results of the well stimulation later this year. If all goes well, I wouldn't be surprised if Rio steps up their participation in the whole district
Rubberworm, can you elaborate on what you know about Friedland's property aquisitions?
From the Dow Jones Newswire: Excelsior Mining could unlock value at its historic Johnson Camp copper mine in Arizona with an agreement to use Rio Tinto's Nuton copper heap-leaching technologies, a positive for its share price, Scotia Capital says. Test work is expected to begin this quarter, and if successful the companies will work toward negotiating commercial terms for full-scale deployment of the technologies at the mine restart. The tech has the potential to produce additional copper more cost effectively, and could reduce waste from new and continuing operations, Scotia notes. It has a C$0.30 target on Excelsior shares, which are now up 13% at C$0.23. (robb.stewart@wsj.com)
Regarding the AMRC comments they are opinion. No real facts presented. It is my understanding that the EPA assigns no weight to opinion without facts backing it up.
You are not alone.
From Triple Flag's Quarterly Report: Gunnison (16.5% copper stream): Excelsior Mining Corp. has reduced operations at the Gunnison Copper
Project wellfield to conserve liquidity and prioritize work on the Johnson Camp Mine restart, planning for
well stimulation trials aimed at improving flow rates and sweep efficiency of the wellfield, and working
through the recommendations of the Gunnison pre-feasibility study of March 2022 aimed at overcoming
the wellfield CO2 generation and flowrate limitations that have been encountered. Acid injection has been
temporarily suspended whilst continuing copper recovery and compliance to ensure underground
solutions are managed and controlled. At the Johnson Camp Mine, infill drill results from the Burro pit
were better than anticipated, with the intersection of zones of significant thickness and good grades. The
encouraging results are the focal point of a new Johnson Camp mine plan which, along with permitting of
a new leach pad and ongoing metallurgical testing and drilling, could see a Johnson Camp restart decision
being taken in 2023 if an economic case can be made.
Rubberworm, thanks for the heads up. Here's the full Northern Miner text for people who don't subscribe.
9 EXCELSIOR MINING
Market cap: $58.5 million (US$45.4 million)
Arizona-based Excelsior Mining (TSX: MIN; US-OTC: EXMGF) has a portfolio of assets including the Gunnison copper project, the past-producing Johnson Camp copper mine, and the Peabody Sill and Strong and Harris copper-zinc-silver deposit, all located in the state’s Cochise County.
In June, Excelsior reported assays from a recently completed 43-hole infill drill program at Johnson Camp. Drilled in the northeast corner of the Burro pit, highlights include holes EBD-21, which intersected 5.2 metres grading 2.05% copper starting from 51.8 metres downhole, and EBD-26, which returned 1.7 metres grading 4.03% copper from 53.8 metres. Assays from six holes are pending.
The company said the results will allow it to develop a mine plan on this new, higher-grade, mineralized zone.
In March, Excelsior released a PEA on the Johnson Camp heap leach operation. The study outlined an operation producing 65.9 million lb. copper over an approximate five-year period.
Using a 7.5% discount rate, the PEA estimated the operation would have an after-tax net present value of US$7.8 million and after-tax internal rate of return of 13.4%. Initial capital for the new heap leach pad was pegged at US$26.5 million, while the initial mine capital was set at US$14.3 million.
That same month, the company released an updated prefeasibility study on the North Star deposit on Gunnison that envisioned a mining operation producing a total of 2.2 billion lb. of copper over a 24-year mine life. Using a 7.5% discount rate and US$3.93 per lb. of copper, the study estimated an after-tax net present value and internal rate of return of US$1.4 billion and 44.9%, respectively. Preproduction capital stands at US$45.1 million and would be paid back in 4.8 years.
First quarter financials and MD&A have been posted on Sedar.
Random thoughts: End of year cash $21 million. Undrawn Nebari line of $15 million. The question is whether $36 million is enough to pay monthly operating costs (about $1.5 million), restart JCM and build the raffinate plant. $36 million would be supplemented by copper sales from JCM. No need for raffinate plant if well stimulation works.
There is speculation that they’re talking to bigger players not necessarily to take them out but to JV. A big player could fund everything for a piece of the action. At $4.40 copper the Gunnison NPV is about $1.5 billion. That’s a lot of value for a stock trading at a $56 million (USD) market cap (less than 4% of NPV). Even if a JV partner funds all capex, (and possibly buys out the stream and royalties) to earn say 50% that’s still a $750 million NPV for Excelsior shareholders. Value that at 60% of net NPV and the stock is worth around $1.65 a share. (274 million shares)
There is simply too much copper in the ground at Gunnison to let go. Someone will want it.
Regarding the "Class Action". A mutual fund that participated in the February 2021 offering is suing Excelsior saying that the problem with the CO2 wasn't fully disclosed in the prospectus. I thought the CO2 issue was pretty common knowledge at the time and you would think a sophisticated investor like a mutual fund would have done its due diligence.
https://biv.com/article/2021/11/mutual-funds-class-action-alleges-bc-mining-firm-issued-misleading-prospectus
Year-end financials and MD&A are now on the Excelsior website.
Thanks rubberworm.
This is from Triple Flag's quarterly report dated November 10, 2021. It will be interesting to see what they report for year end.
"Gunnison (16.5% copper stream): Sales from Gunnison in Q3 2021 were 130 GEOs, based on 54,035
pounds of copper sold. Ramp-up at Gunnison has experienced delays due to carbon dioxide gas bubbles
reducing injection flows and preventing timely ramp-up to nameplate production. The gas bubbles are
the result of the interaction of the weak acid injection with finite amounts of calcite within the permeable
fracture system. Excelsior Mining Corp. (“Excelsior”) believes that this is a temporary phenomenon, as the
calcite dissolves and leaves the system with increased water flushing. Excelsior announced in Q3 2021
that it will be building additional solution treatment infrastructure to flush the wells with a neutralized
raffinate solution instead of water, which will reduce cycle times needed to achieve targeted operational
flow rates. Also during the quarter, Excelsior announced that it will be restarting the past-producing
Johnson Camp Mine copper oxide open pits to supplement copper production as Gunnison continues its
ramp-up to full production levels. A new leach pad and minor piping and pumping facilities will need to
be built for the restart, which Excelsior believes could provide up to 5 years of copper production at a rate
of 25 million pounds per year beginning in the second half of 2022. Any cathode production from the
Johnson Camp Mine is covered under Triple Flag’s stream on Gunnison.
New Excelsior video.
It's my understanding that they need EPA approval for the "other" CO2 solution. It didn't work out because they haven't implemented it yet.
Year-end tax selling I imagine is the primary cause for recent price action. The Nebari announcement is good news for the company and investors as it is not dilutive, provides additional cash to the company, and extends the maturity date.
We're in the beginning of a classic head and shoulders technical pattern which is bullish, so I'm anticipating upward movement soon once the tax selling is cleared out.
EXMGF tested the 29 cent (USD) low back on March 30, 2020. I'm seeing a classic head and shoulders pattern measured from that date to today. A Head and Shoulders pattern typically indicates a trend reversal. For those of you who are into technical analysis, now might be the time to begin or add to a position in Excelsior.
Scotiabank initiates coverage of Excelsior today with a sector perform rating. Price target of 65 cents CDN.
Their loss is unrealized if they still have the shares four months later.
I have to wonder if EXMGF is the only position they have showing an unrealized loss.
Based on the percentages you mentioned and if my math is correct, this MM Fund has in excess of $59 million CAD in NAV.
Their lawsuit, in my opinion, doesn't stand a chance. By any definition, money managers are "sophisticated" investors. They should have known what they were getting into.
Maybe they should have read all the risk factors in the prospectus before they invested. Someone lost money on a penny stock -- imagine that.
Resolution is on National Forest Land. The project still needs to be fully permitted on the both the state and federal level.
Gunnison and JCM are on private land. The BLM, Forest Service, nor any tribal authority is involved.
I think you're right. Dab that lipstick on and see who comes calling.
Quick random calculations: A $1.25 USD purchase price would equate to about a $412 million take-out, or about 25% of NPV at $4 copper. Too low in my opinion. At 40% of NPV $630 million, or about $1.90 a share. Still low but more likely. NPV includes both Gunnison and JCM.
Keep in mind that once Excelsior trades above $1.25, $37 million will come in from exercise of the warrants. Free money to any buyer above $1.25.
And don't forget any valuation added for the former Anglo-American property recently staked.
Go back and research Nord's SEDAR filings. They went bankrupt because copper was $1.50 at the time and they were loaded down with debt.
There's nothing mediocre or bad about today's news. With copper north of $4.30 why not take advantage of this asset.
BTW, three years ago, when I toured the mine, the mineralization north of JCM was pretty well known. Including Strong-Harris.
Excelsior's after-tax NPV is $1.575 billion at $4 copper. It's trading at less than 9% of NPV. That's a screaming deal in my book.
In case you haven't noticed, there's an updated Investor Presentation on Excelsior's website.
I'm very encouraged that even with modest copper sales, the operational cash burn rate is approaching breakeven. Only $651,000 consumed in the last three months. With $27 million in the bank, Excelsior just might make it to nameplate production with cash to spare.
@douginil Nice overall summary of today's call. Please note that it was always assumed that only 50% of copper would be recovered. That is built into the original financial estimates.
An article about Excelsior was posted on Seeking Alpha yesterday. $3.09 valuation.
1st Quarter financials were posted to website. $31 million USD cash in bank. Only 185,000 pounds produced through March 31. MD&A discusses production issues.
Three more reasons to own MIN:
1) The JCM open pit still contains a lot of copper (40 million pounds annually). Economically feasible to mine at $4 copper. Leach pad permit required.
2) Substantial high grade zinc deposits on the north end of the property.
3) South Star property.
The value of these assets are not reflected in MIN's market valuation in my opinion.
I noticed on SH that PI Financial just put a C$2.35 price target on Excelsior.
I'm a buyer and here's why:
Based on the latest financial statements available (September 30, 2020) Excelsior had 239,630,082 shares outstanding and another 20,965,000 shares under warrant exercisable at various prices for a total of 260,595,082 shares.
The offering has been upsized to 29,000,000 shares with warrants for another 29,000,000 shares and the over-allotment of 4,350,000 will result in approximately 323 million shares outstanding assuming all warrants are exercised. Or an increase in the number of shares outstanding of 23.9%.
As a result of all that happening the company will receive new capital of approximately $50 million (USD) based on the current exchange rate.
As I type this, copper is at $3.76. Excelsior's financial models are based on copper at $2.75. That's an increase of 36.7%. That would boost the NPV from $730 million to north of $1 billion. Not to mention that many are projecting copper going to $4 and even $5.
At an NPV of $1 billion and a conservative take-out value of approximately 65% - 70% of NPV, Excelsior could have a purchase value of approximately $2.15 USD a share, maybe higher. I think we'll see the company bought out prior to Stage 3 and quite possibly shortly after nameplate. It's 73 cents USD as I write this. Do your own due diligence but I'm staying in and will be buying more.