CDU - Cudeco Limited

[vegemite]

Anyone subscribe to HighGrade or willing to sign up for a trial subscription (free)? The article below is available on their website but my trial subscription has expired so would appreciate it if anyone could post the full article,

Cheers V

EXPLORATION
You don't suppose ...
May 5 - 11, 2008
STORING too much faith in a report by Martin Place Securities (MPS) on CuDeco Ltd and its Rocklands copper project might be a tad risky judging by some of the queries being flagged by outsiders familiar with affairs in north Queensland.
Read the full article

 

[vegemite]

Now have the HighGrade report as below, Cheers V

You don't suppose ...
By Staff reporter, 5 May 2008
STORING too much faith in a report by Martin Place Securities (MPS) on CuDeco Ltd and its Rocklands copper project might be a tad risky judging by some of the queries being flagged by outsiders familiar with affairs in north Queensland.

The bullish MPS report, which among other things claims Rocklands as “one of the most important base metal mineral discoveries of the past 20 years”, estimates a two-million-tonnes-per-annum mining and processing operation would have a “relatively low” capital cost of about $A100 million.

“Access to main grid power, having established major highways within 5km and close mining site infrastructure will minimise capital costs,” the MPS report said, as will “low overburden and stripping ratios.”

According to an independent source – who not surprisingly didn’t want to be named – the estimate of $A100 million seems inordinately low for such an operation, with double that price tag considered more realistic. Operating costs of below A50c per pound were also queried as being someway south of what is likely to be the mark, though if CuDeco’s copper grades are indeed as MPS is estimating, then Rocklands would certainly be a low-cost operation.

MPS has modelled the copper ore to be processed as grading 3% copper for the first six years of the operation, with some 54,000t of contained copper to be produced in 2010 and 2011, and some 81,000t in the following four years when throughput is increased to 3Mtpa. About one-third of the copper produced in each of those six years will come from native copper, with Rocklands estimated by MPS to contain some 7Mt grading 5% copper – as part of a total MPS estimate of 111Mt at 1.83% copper, 0.05% cobalt and 0.23gpt gold.

Should MPS’s grade estimate prove accurate – an official JORC resource continues to be long awaited and is said to be due early in the second half of 2008 – Rocklands would have the key ingredient for it to be an outstanding project. A simple comparison highlighting just how outstanding can be seen by the project’s capital intensity per annual tonne of production.

While the rest of the copper world was told at a major industry event in Chile last month that this measure was heading on average to about $US10,500/t – with projects that averaged $US7000-8000/t were said to be doing very well – Rocklands’ $US100 million capital cost and 54,000t of copper production means a capital intensity of just $US1800/t. In other words, a little over one-tenth of the global average.

With the MPS-forecasted grade of 3% being about five-times the global average, part of that notional difference is explained. So again, the official Rocklands resource will be telling.

Another question mark placed on the MPS report relates to the production start-up date.

“MPS expects CuDeco to finalise its definitive feasibility study by June this year which includes completion of a native title agreement, approval of a mining lease after the environmental impact assessment and completion of the project engineering design,” the broker said. “Earthworks and pre-stripping of the mine pit will be required and this can commence early third quarter this year until completion close to February 2009 when open pit mining will commence.”

That MPS timeline is fanciful according to a third party familiar with the regulatory and operating environment in Queensland.

Time, as they say, will reveal all.

 

[Gundini]

This is my first stock purchase since Oct 2007.

If this company has half the copper that the pictures in the latest presentation suggest, it will surely live up to its slogan, "The new force in copper".

Still has plenty of cash left, and appears to have found a base.

Lots of pretty pictures, well worth a look!

http://www.cudeco.com.au/pdf/Cudeco_Presentation_2008AGM.pdf

 

[Gundini]

This stock did ok today after a nice confirmation of Copper.

Could it be a breakout?

I don't have then correct tools to draw a TA, but starting to look ok over a beer!

 

[Gundini]

Could this stock be a leader in this country?

Are there any copper bugs that can see the upside in this guy?

 

[Sean K]

Surprised there's no long termers still about sprewking this stock. When (if) Cu recovers this could be anything. Wonder if they'll get anywhere near the ramp they put out as their initial inferred estimate.

Some amazing grades still being produced. Worth keeping an eye on perhaps for when (if) things turn around.

Up 100% from the low, which is standard for the sector at the moment.

Any holders out there?

 

[stix1771]

Director sinks in $170K more, SP spikes on Friday, Qtrly out, more good intersects out.........waiting!

 

[turboprop]

hello all . i rarely post as i seem to get banned from stockmarket sites for outing obvious downrampers with skullduggery in there hearts .as for cdu the resource has only gotten bigger with ceo buying , i only ever accumulate this stock as imo it has the potential to be the biggest find in many a year and once mining begins dividens should follow i notice a certain last alphabet man still downramping on another site .me thinks he is a paid personality for the dark side , i sadly i cant post there

 

[Sean K]

Broken through $3.00 by the seems which looks extremely important long term. Check out that previous support, now massive resistance. A little pennant on the short term chart that looks like it might be about to brak up too. Copper recovery obviously the catalyst.

 

[stix1771]

Broken through $3.00 by the seems which looks extremely important long term. Check out that previous support, now massive resistance. A little pennant on the short term chart that looks like it might be about to brak up too. Copper recovery obviously the catalyst.

I think the pending announcement might be the catalyst......won't know until it comes out of suspension....

 

[Sean K]

I think the pending announcement might be the catalyst......won't know until it comes out of suspension....

It's a capital raising, so might depend on the numbers. Capital raisings have be welcomed by the market lately.

 

[stix1771]

It's a capital raising, so might depend on the numbers. Capital raisings have be welcomed by the market lately.

Agree, the Cap raising have been well accepted of late, and it's encouraging to see CDU (and JML) use the improving SP to good effect. Some canned the Buy Back as a cash burn exercise, but looks as though it will pay dividends in this exercise, as well as make cash fro CDU. think the av buy back price was below $2.00, so even at the mooted $2.50 by the AFR it's a money spinner....but it's not the main game!

 

[Sean K]

Cripes! They've had to settle for $2.50.

That doesn't look so hot to me.

At least they've got some cash.




Equity Raising of $52.5 Million

Highlights
• CuDeco has arranged a comprehensive equity funding package of $52.5m at $2.50 a share, comprising:
a placement to institutional investors in Australia and overseas for up to
A$42.5m; and
an underwritten share purchase plan (“SPP”) offer for $10m.
• The Lead Manager of the placement is Azure Capital Pty Ltd. Subject to finalisation of documentation, Azure will underwrite the SPP offer.
• The funds raised will place the Company in a strong position to achieve significant milestones for the development of the Rocklands Project, including giving it better leverage for negotiation of project finance.

 

[doogie_goes_off]

More than happy to be offered a few more at $2.50. Expecting there is enough to start feasability for Rocklands now.

 

[giasing]

There is 3 resistance lines at $2,$2.5,$3. what i though is if CDU maintain at $3 level a few days more, it could be a hot stock for me.

 

[Sean K]

There is 3 resistance lines at $2,$2.5,$3. what i though is if CDU maintain at $3 level a few days more, it could be a hot stock for me.

Wow, a 'hot stock'! Best on get on board then!

Yes, holding above $3.00 is very important if the long term breakout is to be confirmed. Going under again, and she's just tracking sideways, and it'll be a lukewarm stock only.

 

[S73417H]

I was recently steered in the direction of CuDeco by a stockbroker. They look to be in quite a strong position regarding assets held and current position within the market.

Their company slogan may very well prove to be an accurate assessment if the price of copper continues growing.

The fact they have Cobalt and a potential store of Uranium is a pretty nice sweetener also.

One to watch...

 

[JnrTrader]

very interesting stock, been following this of late. rocklands is apparently, from what i gather an 85mt cu resource however the asx would only allow them to inform the market of 25mt...Wayne McCrae has told shareholders about this and still they are not allowed to publish what they believe they have...another thing to note is that xstata hold a heavy presence in the area in queensland where rocklands is situated, and one of their major copper mines 40km east is due to run dry soon. While the deposit at las minerale is not the biggest, McCrae has said it is possibly the highest cu content deposit in the world so def one to watch

 

[DVEOUS]

I see that earlier this week, the CDU Chairman/CEO, Wayne McCrae, obtained another 6,000 shares @$2.50.
(I'm not sure if this is from the capital raising allotted on July 3)

If a company director is accumulating more shares, they obviously know something, and that the company is moving forward?
Should the rest of us treat this a no-brainer, and get on board too?

Is the 285.39 P/E ratio given by Commsec right?
This is well above the sector, and possibly erroneous.

 

[Sean K]

I see that earlier this week, one of the CDU Directors, Wayne Michael McCrae, picked up another 6,000 shares @$2.50.

If a company director is accumulating more shares, they obviously know something, and that the company is moving forward?
Should the rest of us treat this a no-brainer, and get on board too?

Is the 285.39 P/E ratio given by Commsec right?
This is well above the sector, and possibly erroneous.

Directors buying shares can be positive, but not $15k, or whatever. Pittance.

Overall management ownership is very important to explorers/developers imo. If they own quite a substantial part of the company then great! Not so great if they have gazillions of options at a really low strike for no incentive to grow the comany. Watch out for that one!

Directors selling shares is ALWAYS bad imo. Even if it is to pay off a loan or buy a new yacht. No excuses!!!!!!

They don't necesarrily know anything more than they did a few days ago, and there are rules regarding when Directors can buy and sell around announcements to reduce the risk of insider trading.

Not that that means a whole lot....

A PE is only relevant if the company has an E. How much did they earn last year apart from interest in the bank?