Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
Keeping to the subject of Cobalt, here’s what our 23rd January 2018 RNS stated, concerning samples taken on the Cobalt belt properties:
“Highlights
• 46 surface grab samples were collected at the Company's Redcastle iron-rich copper/cobalt and Bighorn copper/cobalt properties in Idaho, USA - 20 samples are representative of the Redcastle (SCOB) project and 26 of the Bighorn (NCOB) project
• All of the sample results showed cobalt mineralisation above detection limits and ranged from 2.0 ppm to 3120 ppm, or 0.31% Co
• The sample results showing cobalt values greater than 100 ppm and copper values greater than 0.5% Cu are considered significant for the purposes of future exploration and targeting”
Those are pretty good grades. As our CEO wrote at the time “I believe that Phoenix is at the right time, and at the right place, to deliver a successful cobalt exploration programme …”
Below the radar, or what?
Hush. Hush. Be quiet everyone. Listen, and don’t let this out. This is top secret. I say this, as I don’t know why this has been kept quiet. But maybe it’s just been missed? But I’ll let you into this.
Cobalt price 1st January $33,000/ton. Cobalt price, 1st February $41,240/ton. That’s a 25% increase in price this year so far!! And PXC have a large Cobalt patch, over in the Idaho Cobalt Belt, at Redcastle and Bighorn.
And we’re on the strike line with the Iron Creek Mine being developed by First Cobalt who purchased the property for $149 million in June 2018.
Plus this is the only Cobalt region in USA, and it’s a strategic material. What more needs to be said?
Another and perhaps more reliable way of looking at this question for Red Star (ie PXC silver) was suggested by Hardman in their research, who wrote, “Our DCF valuation is 31p/share, based solely on the silver mine (at Red Star), a cautious (for now) 15% discount rate and a long-term silver price of $19.00/oz. PXC’s share price is highly geared to the upside thesis for silver, with each $1.00/oz adding an estimated 6.2p-6.3p/share.” If we input the present price of silver, that would suggest that the Phoenix share price should today be 99.2p, I repeat based solely on the Red Star mine, which in any case is now determined to be much, much larger than when this valuation was first made.
It is worth noting that the BoD consider Red Star to be so interesting and have such potential that they have already announced that they will be restarting drilling just as soon as conditions allow. For those interested, the Hardman and WH Ireland Researches can be accessed from the PXC web site under “Investors”.
So, to summarise, in their research Hardman suggested our fair value share price based ONLY on the silver mine at Red Star should be 99.2p (on a silver price of 30p), a valuation which excludes the extension of Red Star, the Empire Open Pit mine, the Carlin deposit at Navarre Creek, the Cobalt at Redcastle and Bighorn, or the extensions of Empire through Windy Devil, Horseshoe and White Knob. Now I hope you can see why I’m so enthusiastic for this share and this great opportunity. I myself cannot understand why the sp is not already way above 100p. But it does represent a fantastic opportunity.
A poster on Telegram wanted to know about our silver assets, so I posted the following:
You asked Markymark about the silver potential. I think this could be my most important post of the last week, even more important than Navarre Creek, and I therefore thank you Marky for the question. This subject is worth a more detailed explore, as it reveals, in my opinion, some of the hidden potential from Phoenix. The silver resources have been formally determined to date for just 2 mines. Empire and Red Star. Looking at Empire, this is the open pit gold mine, and the subject of the present investigations, namely metallurgical studies looking at the recoveries of gold and silver with environmentally friendly ammonium thiosulphate, and presently plugging this data into the economic models to work out the profitability, which should be presented to us in a few weeks. The resource data for this mine was presented in an RNS dated 9th December and shows Measured + Indicated for silver as 7,595,198 ozs. Inputting a price of $30/oz, we come to a value of $228 million. That’s M&I. If we include inferred (2,538,574 ozs), that makes a total of 10,133,000 ozs or $304 million at $30/oz. Of course not all the metal can be recovered, but this sets the scene.
But the real silver mine is Red Star, which has fallen from attention a little in recent times. This is a silver/lead seam located a short distance from the Empire Open pit. An exploration programme was part completed in 2020, but was held back as it was discovered that the seam twisted and buckled, making drilling difficult (the seam was also covered on the surface), but they identified that it was hosted in magnetite, which should make future drilling programmes much easier, as the magnetite is magnetic and can be traced. They also identified that this seam almost certainly carries up beyond the previous determined 320 metres through to the historically mined high-grade Horseshoe and White Knob claim blocks 5 kms away, which would make Red Star a giant. We only have the data from the first 320 metres at the present time, and if my information is correct (taken from the WHIrelend Research), we have 6.8 million ozs of silver, which at $30/oz would value this at $205 million. So add together silver from Empire and Open pit and we have $525 million for silver alone, as silver in the ground.
“As the world electrifies, the mining industry will strike gold, Robert Friedland predicts”
A nice read from Robert Friedland, the legendary mining financier. His comments on the USA are particularly relevant to PXC, in particular his view that pricing differentials in metals will develop, depending on the “greenness” of their production. Since much of the electricity in Idaho is hydro-produced, PXC is well placed.
He talks of this age as being the “revenge of the miners” ”People are waking up to the fact that certain elements in the periodic table are going to be huge winners” and “The world is screaming for copper to electrify the world economy”. “The whole system has to be rebuilt, top to bottom, and that is what is bringing the onset of the revenge of the miners.”
hTTps://www.bcbusiness.ca/As-the-world-electrifies-the-mining-industry-will-strike-gold-Robert-Friedland-predicts
Just posted on Telegram by Richard Wilkins, PXC CFO
Dear All. Thanks for your patience. It has been frustrating for all of us waiting for results. Hopefully the Navarre Creek results were worth waiting for. We certainly believe so.
As for Empire we will publishing the economic analysis shortly, as Ryan says. Once the optimisation work is completed. We hope that will be worth waiting for too.
But we must keep the bigger picture in mind. We intend to build a billion dollar company, and keep the issued share capital as small as possible. The open pit mine on its own won’t achieve this. But the cash flow from the OP mine, much of which will be ploughed back into very exciting exploration (Navarre Creek, Red Star and of course the underground elephant in the system), thus avoiding the need to finance exploration entirely through equity issues, will, we hope, achieve this. Production and cash flow, plus exploration on serious potentially high value targets, is a great and valuable story.
Stay well everyone
I sense the excitement here, which is based around the Empire mine and its gold, plus more than anything today the gold play at Navarre Creek. But please do not forget that the Empire Open Pit Mine does not include any economic assessment of the deeper Empire Sulphides, the Red Star silver mine, the continuation of the Empire pit north (Windy Devil, Horseshoe, White Knob and Blue Bird Mines), or the Idaho Cobalt belt properties (Redcastle and Bighorn), or other projects within the Phoenix portfolio. You buy into the Empire Open Pit project, and you get all the rest for free. And what a bargain at today’s price!
Have you seen that PXC have posted over on LinkedIn the reason for their confidence in Navarre Creek results creating a money making mine. See this on
hTTps://www.linkedin.com/posts/phoenix-copper_pxc-pxclf-activity-6760531514473119745-DyzZ/
Here's the text: We have today announced the results of our sampling at the Carlin-style Navarre Creek gold play.
Surface grades of gold at Navarre Creek are consistent with historical early-stage exploration grades reported from Carlin-type projects in Nevada. Here’s the data, and there’s no better way to compare than to see announcements from other companies, going back to the pre-drill stages in their history, trying to ascertain what levels of ppb made them continue exploring and then able to fund their projects. Looking at those companies who are today active in mining the Carlin Trend in Nevada, all data from open sources, showed Gold Standard had initial findings of “1 to 325 ppb Au”, Crestview “240 to 400 ppb Au”, Dynasty Gold “as high as 100ppb Au”, whilst Kinross’s Bald Mountain mine uses a cut off of 140 ppb Au. For Phoenix, in all samples where we found gold, we had above 100ppb, with one sample up at 569ppb. We can therefore say with a degree of confidence, based on regional experience, that surface grades of gold are consistent with historical early-stage exploration grades reported from Carlin-type projects in Nevada.
Let me write a little more concerning today’s RNS. I’ll address the 2 topics separately, Empire and Navarre Creek.
First, Empire. This is the near surface oxide pit, always the easiest and lowest cost to mine. The company have explained the delay in producing the report, blaming it on COVID and the complexity of the pilot plant work. Although this delay is frustrating, it does sound reasonable to me.
It looks like they are now in the final stages optimising all the scenarios, including the size of the operation, of the recovery of cathode copper manufacture from either heap leach or agitation leach, plus recovering in a second stage the gold and silver using Ammonium Thiosulphate in place of cyanide. That sounds like they are getting very close to their preferred optimised solution. This will allow them to produce an optimisation of the Empire Mine open pit economic model. I would expect this to be in weeks. I also note that the PEA has disappeared, and it is now a PFS, which can explain the delay as well. Moving to a PFS represents a major step forward as it has much more credibility with financiers. Maybe they should have gone this way earlier would be Sparkey's question.
Now on to Navarre Creek. The key information is there in the title “Navarre Creek surface sampling results confirm presence of volcanic hosted, Carlin-type gold mineralisation”. Carlin deposits are named after the little settlement of Carlin in Northeastern Nevada, and Carlin deposits can be very big gold strikes indeed. The Barrick gold mine on the Carlin Trend which started this off is the world’s 8th largest gold mine, which is a relatively short hop and a jump away.
The shallow ore in Carlin Trend type deposit is usually oxidised, which is relatively simple and cheap to extract since it can often be mined by open pit which costs a fraction of underground mining. I wrote last week that we are expecting the assay results back from surface samples, and should not expect high levels of gold. This is because the gold should be present in very fine particles, generally too small for the human eye. Over time, the gold near the surface is leached out, so there should be just minute traces near the surface. Levels in the parts per billion level would be very positive. Now just look at the results. They’ve gone and found gold. Not just gold, but lots of it, in levels equivalent or better than those found over in the original Carlin Trend. This confirms that the Navarre Creek deposit probably has immense value.
That’s the smoke showing there is fire below, in other words below the leached top layers, we have a gold mine. I wrote last week, that if we have higher than parts per billion, we can expect the champagne corks to start popping. My friends, we have many times parts per billion! Look at the results, we have several samples with hundreds of parts per billion.
Sparkey, you got your wish, but a day early!
My quick takeaways from the RNS (I’ll post later with a more detailed analysis):
# This is a CRACKING RNS. It may not have the results of the PEA, but it’s made up for it in many other ways, maybe even surpassing it
# The PFS should be delivered very shortly, but the optimisations continue, hampered by COVID in the laboratories. Note it’s now a PFS, not a PEA (which takes more time, but has better acceptance). That’s much better!
# Navarre Creek looks remarkable, genuinely remarkable, with many conclusions:
> They were expecting gold in the ppb, but found it in ppm. That’s amazing !!
> The results on the samples to date appear at worst equal, and maybe even better than the initial samples found on the Carlin Trend in Nevada. That’s GIANT!!!
> The southern end sample (32519) has a similar metallurgy to the Empire pit some 5kms away. That says that the Empire pit may be larger, much larger than initially thought
Twitter.com/Phoenix_Copper/status/1353632132074246145
Have you seen today's Tweet about Navarre Creek? It's enticing and teasing.
The Navarre Creek formal announcement when it arrives could be game changing. The company have mapped out the route to opening up our potentially enormous deep resources by throwing off cash from the Empire open pit mine, but for Navarre they have speculated on a different route, maybe through a JV. The perfect example of this is from Carlin itself, which gave its name to the trend. Let’s dream a little by reading the opening words on the Nevada Gold Mines page on the Barrick site:
“Nevada Gold Mines is a joint venture between Barrick (61.5%) and Newmont (38.5%) that combined our significant assets across Nevada in 2019 to create the single largest gold-producing complex in the world.”
That’s the Carlin Trend for you…. Let’s dream
Hi Harry,
Good question. As I understood it, the relationship was for EAS to identify companies prepared to finance PXC, once the PEA was issued. I know that they have been busy talking, but guess that it is premature for any arrangement to have been reached before the PEA. I am also aware that the company intend to plan some webinars and other forums once the PEA is out, when they will obviously have quite a lot to talk about, and I know they want to broadcast this business. Discussion concerning finance will be on the agenda. That's not too long to wait now.
Over on the Telegram Group, Richard Wilkins (PXC CFO) posted the following, which offers an explanation for the recent silence:
"We will update the market next week. Our hands are somewhat tied due to close periods which AIM and the Nomad monitor closely. Once we are out of the close period and can talk about things we are eager to get onto some podcasts, webinars or whatever. PEA is progressing well under very difficult circumstances. Covid has badly hit the laboratories - staff shortages, difficulty in timely sourcing of reagents, chemicals, etc, plus increased demand from mining companies due to rising metal prices. It is important however that we optimise the open pit project for all our benefits, also taking advantage of the clean energy, green economy world that we are clearly moving into. On another front, we finally have the Navarre Creek gold assays back. Only 4 months or so late. Enough said for now! Patience is a virtue".
So, whilst not the final news, it announces that news is imminent. The words on the Navarre Creek gold assays are enticing.....
Guys, everyone wonders about their investments. However, the facts are there for Phoenix, particularly with the accession of a President who is supportive of this industry and in particular the metals we will be producing. If you doubt that, then please post some facts which suggest that Phoenix has changed in any way. If you are after short term gains, as traders, short term profit takers, that's fine, but please come clean and admit it. I repeat a message I have said several times before. This is a share to hold for the long term, one which may quite well give you your pension. Put it away and forget about it.
The company promised the PEA in weeks back in December, and we are surely still within that period. What has changed except perhaps impatience? May I suggest that those impatient come clean for their reasons, and use facts, not emotions. I doubt that there are many companies out there who could compete with the opportunity for growth in Phoenix looking forward the next years!
Whilst we are waiting for the PEA, let me remind everyone that we are still waiting for the long overdue results from the gold play at Navarre Creek.
The surface geology at Navarre Creek looks compelling for this to be a Carlin style deposit (look this up if you do not know), which could be massive (or nothing). Carlin deposits are named after the little settlement of Carlin in Northeastern Nevada, and Carlin deposits can be very big gold strikes indeed. The Barrick gold mine on the Carlin Trend which started this off is the world’s 8th largest gold mine, which is a relatively short hop and a jump away.
The shallow ore is usually oxidised, which is relatively simple and cheap to extract since it can often be mined by open pit which costs a fraction of underground mining. We are expecting the assay results back from surface samples, and should not expect high levels of gold. This is because the gold should be present in very fine particles, generally too small for the human eye. Over time, the gold near the surface is leached out (prospectors used to pan for it in the rivers), so there should be just minute traces near the surface. Levels in the parts per billion level would be very positive. That’s the smoke showing there is fire below. Our geologists are optimistic that this has potential. Again, the results could come any day now. If we have higher than parts per billion, we can expect the champagne corks to start popping.
First for Dan. I'm glad you raise what you call the similar situation of “BP, Lloyds or HSBC, and that you do not have to call them to find out why they have not released key financial information to their own timescales”. The difference is first that these are all very mature companies, with a steady flow of news, large resources, and a large PR department. Meanwhile PXC is reliant today on a one-off event (the laboratory results), which at the moment are not late in any case by most people's understanding. Also, please note laboratory testwork cannot be predicted, for if you could, you would not bother doing it. You therefore cannot compare those companies with PXC. We have a binary situation, the results are declared, or work is progressing. Simple.
For Stanley, let me say that I do not consider myself a cheerleader. I am posting on a purely voluntary basis, and have never been asked to do this by the company. Anyone can call to the company. That I do it, is neither here nor there, and I can stop if my posts are not appreciated. I therefore found your statement “Feeding info to one person is amateurish” was both inaccurate and inappropriate.
But let me come back to the issue of announcements. This is a start-up company which by design will not have a continuous news flow. We have not yet built our plant, nor started production. There will be announcements made when there is news to release. If the results from the laboratory are delayed a few weeks (of which I have no knowledge) so what, for this is a share to hold long term, for years not weeks, and which could generate a return beyond your dreams. What difference can a few weeks make? If you feel differently, then either call to the company, to find out more (and how many times have I suggested this?), or go elsewhere, for you are free to do that as well, for I believe that you do not understand this company and this opportunity. And I emphasise, I am speaking in a personal capacity and have not consulted with the company over my post.
I'm going to raise a philosophical question here. Why are you buying PXC shares?
Let me state here my opinion for why you should buy PXC. This company is going to have massive long term success. We see it in the resources, and we see it in the first Empire open pit mine, and the Resource data we've seen to date, combined with the laboratory recoveries of gold and copper. This company will make a lot of money for all those who invest in her, AND HOLD. On the way to that, there will be long periods when there will not be any news, when we are building our plant, when we are waiting for start-up. In these periods the share price will probably fluctuate. But you will never know when good news will be delivered, and if you are out, then you may miss the boat. When the results from Navarre Creek appear, when the silver mine is explored and results delivered, when the finance arrives, when we hit on another rich seam. My strong advice is to place your share certificates in the bottom drawer, and forget them, and to come back in 5 years time for your pension. If you are interested in short term profit taking, without real concern for the long term business, then this company may not be for you, since the price may pass through periods of stagnation, rather like now. Plus it's rather frustrating to those long term holders, with interest in the long term of this company, who are prepared to accept those periods, knowing that the building work is still going on, even if not shown in the share price.
So, I would encourage all to buy, and to hold on. and to put away for some years.
Guys, I sense your frustration, and I share that. First, some personal comments, to reinforce my position. I am a chemical engineer, a Fellow of my Institution. I am a professional, and try to post professionally. I have no connection to the company aside being a shareholder, and a friend, and most certainly do not consider myself a spin doctor. I do like the BoD, and find them also to be professional, and often post because I know that they cannot do that, under the rules. I post what I learn from research and from calls with the directors, but it is all public information.
One of the lessons I have learned in life is that it is far easier to criticise people, than it is to actually ask them directly "what's up". Could I ask why none of the recent posters have called to members of the BoD? If you won't do that, then please could I ask that you refrain from criticism of others that do.
I really don't want to get into a ****ing contest, so believe it won't serve any point in me providing a point by point response. I have also given an explanation of the technical complexity, and if you do not want to believe that, then I’m sorry, that’s your issue, not mine.
I have spoken with several directors the last week. From what I've learned, there’s certainly no cover-up, simply a going through stages and phases of testwork that must run their course to give the PEA its best/optimal outcome for all stakeholders, despite the vicissitudes of the pandemic. One director used the specific words "we will do the best professional job possible for all". I ask, can you posters never say you have never regretted taking a decision in a hurry (when some extra time would have delivered a better result)? I also noted the following from one director "Quite frankly, I see all around me, not only in mining but internationally in construction, in pharmaceuticals, and purchasing/supplies, companies struggling to get orders filled and to deliver services – it’s not a happy world out there for the large part! I can’t blame people for moaning but patience will, I hope, be rewarded!". And yes, they are still hoping to produce the PEA outcome for January.
At the moment I think we can all agree, the company is within the time schedule. Could I suggest, if you have concerns that you do call to the board, and do post what you learn.
Hold on Sparky. Let me suggest your first point of call if you are close to panic (as it sounded from the tone of your post) should be to communicate with the company. The BoD are extremely open, they publish their contact details on all RNS's, and would welcome calls to explain the issues. That’s a far more positive solution, particularly if you post what you learn.
Personally, I have read through the detail from Ryan, and find that we are still well in line with the timing Ryan states in the RNS. Additionally, I would state that they cannot work out the PEA without knowing the configuration, and it would be foolish to suggest otherwise. The recoveries of gold and copper would differ according to which recovery stage came first in the process, and similarly the operating economics. All of these are needed for the PEA. I know this from having called to the company, and I did post that here.
My suggestion, sit back and relax, and wait for the PEA to emerge in its own time.