EXS - Exco Resources

[56gsa]

EXS was originally intending to have White Dam gold project up and running by now - but latest quarterly suggests it still could be 2-3 months away - which good be reason for recent fall above and beyond the broader market sentiment.

However once operational they think this will produce $10m free cash flow per annum for 3 years. With that, along with $12m cash in the bank, the Cu and U potential, their current market cap of about $75m is looking slim...

long-term bottom trend line could be around 29-30 mark so this may provide support but would like to see more volume on buy side

 

[56gsa]

caught up in general mood of market with a hint of disappointment at progress with White Dam perhaps... wonder if this will stoke interst in EXS - or will EXS shareholders get priority?

Kevin Andrusiak | August 08, 2007
MACQUARIE Bank is believed to be putting the finishing touches to a $90 million float of Australian assets of Ivanhoe Mines.

Details on the deal are sketchy, but Ivanhoe indicated that something was in the wind by saying "it's a definite possibility" and "we are keeping all our options open". The Australian understands that the float will kick off on September 3.

Ivanhoe, which is chaired by billionaire Canadian mining magnate Robert Friedland, has a suite of assets near Cloncurry in outback Queensland. Copper, gold and uranium mineralisation have been encountered over a number of prospects at Ivanhoe's Cloncurry Project which includes the historic Selwyn Mining District, covering 1450sqkm and producing close to 1 million ounces of gold and 175,000 tonnes of copper in the past.

Ivanhoe has ramped up the drilling at the project to define a copper/gold resource at Swan prospect and is working to better understand the mineralisation at Amethyst Castle and Metal Ridge. No doubt the uranium mineralisation will attract its fair share of interest by investors, but uranium mining in Queensland is still banned and there is no hint of an idea when it might one day be allowed.

30 cent level looks to be critical else could find support at 28 / 26?

 

[mack44]

Closed at 38c on Friday - any update to your charting??? Putting aside the turbulent times the market will see over the October month, would be interested in an update to this thread on EXS.....

 

[fonterra]

Anyone still following this little mining junior here?

Recently there was an article on it on FNarena, which is very postive on its outlook, and today the closing sp ends at 0.27 which might indicate a breakout on Monday? Well i am not a expert on charts but to me it looks that way.

what are some of ppls thoughts?

Sry dont really know how to insert the chart here...:

 

[56gsa]

yes - this getting some attention again - article from mineweb below..

Bullish broker study puts copper explorer in several plays
A profitable offtake agreement, deals on other properties and being in the gunsights for a planned Robert Friedland base metals float are key aspects of a positive evaluation of copper-gold explorer Exco Resources.

Author: Ross Louthean
Posted: Thursday , 14 Feb 2008

PERTH -

The positive exploration results being produced by Perth-based Exco Resources Ltd (ASX: EXS) in the Mount Isa-Cloncurry belt of north west Queensland has attracted a speculation buy tag from a global stockbroking house - with the assessments made themselves being speculative.

RBC Capital Markets, a broking division of Royal Bank of Canada, said that if an offtake agreement is struck between Exco and Xstrata plc on having Exco's E1 Camp copper-gold deposit treated at the nearby Ernest Henry mill it could bolster Exco's shares by $A1/share ($US0.90).

RBC says that with the mature Ernest Henry open cut and Xstrata having to move into underground development the spare capacity of its mill could be as much as 3 million tonnes per annum.

The E1 Camp deposit, 8 kilometres from the mill, has a resource of about 200,000 tonnes of contained copper and 200,000 ounces of gold - based on 26 Mt @ 0.85% Cu and 0.25 grams/tonne gold).

"We believe that Xstrata will sign an ore offtake agreement with Exco by mid 2009, and we understand the two companies are already in discussions," RBC Capital said.

The broking house modelled first E1 Camp production by mid 2010 at a rate of 3 Mtpa for 7-8 years.

RBC said E1 Camp was only part of an impressive package of properties in the Eastern Mt Isa Inlier that are in and around existing copper mines and deposits. Exco's resources total 345,000t of contained copper and 347,000 oz gold as well as an emerging 3,500t of uranium.

"Through deep drilling, we believe there is a high chance that Exco could discover large iron oxide copper-gold (IOCG) deposits within its tenement package. The company has five drill rigs and a $A5 M ($US4.5 M) annual exploration budget.

RBC said Robert Friedland's Ivanhoe company's Australian company - under consideration for an Australian IPO -- could increase its Exco shareholding from 12% to 18% by mid-2008 through exercising options.

"In our opinion, this is not only a blocking stake but a sizeable holding for a potential bid. We would not be surprised if Ivanhoe launch a takeover bid for Exco after the listing of its Queensland copper assets in 2008," RBC Capital said.

The recent expansion of Xstrata's Mt Isa copper smelter from 240,000t to 300,000t per annum of copper anode was designed to match increasing copper production from its Mt Isa and Ernest Henry copper mines.

"However, we believe that production at the Ernest Henry mine will reduce significantly from 2011 onwards as the operation switches from an open pit to underground operation.

"As a result, Xstrata faces the scenario of a large copper smelter running at 80% of design capacity. In fact, our analysis shows that there may be up to 60,000t of spare copper anode capacity as soon as 2010."

RBC Capital sees Exco as one of "the most impressive copper exploration tenement packages in all of Australia." It has over 4,700 km²

Exco acquired the majority of its land package from BHP Billiton in the late 1990s during the mining giant's sell down of its global exploration assets, and in 2006, it acquired further ground around the Cloncurry region from Haddington Resources.

chart shows volume coming in and could test upper band of downward trend which is also a resistence level @ 28.5c - if it breaks through this could see it run onto the 32c level...

 

[56gsa]

article above may have touched a nerve (or at least an investors hip pocket)up 12% today range 28.5-30.5 ...

the proximity to Xstrata's Ernest Henry's operation is a big positive - smelter could have spare capacity by 2010 - say 2 years to get EXS's mine up and running means they've got to think about gettting things moving this year ??

 

[56gsa]

things are happening at Exco - naturally enought cause I didn't have them in the competition this month!!

interesting that Ivanhoe exercised options - this is a big vote of confidence in the future of EXS given the pre-feas on Cloncurry is due in a couple of weeks - would suggests there's good news to come - hopefully Xstrata's watching

The Company is pleased to confirm that its largest shareholder, Ivanhoe Australia Limited (a wholly owned subsidiary of NYSE and TSX listed Ivanhoe Mines Ltd) has exercised their full option entitlement (21,120,000) raising A$7,392,000. As a result Exco currently has cash of approximately A$16 million and Ivanhoe Australia’s interest in the Company has risen to 19.6%. Exco previously completed a capital raising in May 2007 with participants at the time receiving 4 options for every 5 shares issued. The options are exercisable at A$0.35 on or before 1 June 2008.

 

[56gsa]

have posted this on eqn as well but thought worth highlighting the market is valuing EXS's Cu resource well at the bottom range - Xstrata is busy trying to takeover IRN at the moment so they can have 100% of Tampakan in the Philippines but they still need more feed for their EH plant and times running out....!!

or maybe they will sell EH off and focus on other Cu reserves? Who would buy?

Market valuation of in-situ metal
PanAust Cudeco CopperCo Zambezi Anvil Equinox Matrix EXCO Discovery Indophil
US$/lb Cu 0.54 0.48 0.46 0.31 0.27 0.22 0.11 0.11 0.1 0.04
kt Cu (attrib.) 1500 440 360 68 1769 6278 276 403 352 4800

 

[56gsa]

Continues to look a good prospect imo on three fronts:

Undervalued mkt cap
243m shares
+25m unlisted options

Aiming to have 50mt ore resource identified in 2009 (currently 42mt)
The goal is to process 2mtpa ore which would give:
20,000t Cu concentrate
14,000oz Au credits

Using current prices for Cu and Au, and assuming earnings is half of total revenue, EPS is 35 cps. Optimistic perhaps, but even at half that (17cps) you would still expect to see EXS up around $1.70 (mkt cap of $454m)

As comparison TMR has mkt cap of $135m and is producing 6,000t Cu with far less gold credits and less resource (10mt ore, similar grade)

Feasability progress:
The company is moving from a pre-feas to bankable feasability study in the next month. They will be evaluating finance options over the next few months - this typically makes the project news worthy and attracts attention. Currently $16m in the bank and $4m of options expire 1 June (ex price 35c - right on the money)

Takeover / tolling potential:
EXS are saying they will aim to start construction of the 2mtpa plant mid-2009 - this does not make sense given the proximity to Xstrata's Ernest Henry which will have spare capacity in 2010. Logical thing is for offtake agreement with Xstrata. Another option is Ivanhoe (which has 19% of EXS) will take it over. EXS has JVs with both Xstrata and Ivanhoe in the area...

All in all not sure how this will pan out but given EXS is one of the lowest valued Cu resources (as per numbers in previous message - cf CDU which has mkt cap over $400m with apparently similar Cu resource and further behind in development) and is making solid progress towards mining I can see this being re-rated in the second half of 2008.

Long term chart suggests pushing over 40 cents with volume could test high at 51 and then blue sky...

 

[56gsa]

strong day from exco with good volume building - not many days in its past when EXS has been over 2m shares traded...

price still hovering under 40 though and really needs to push above 42 imo to have a good run at the blue sky

for me, the fundamentals are lining up... and the timing is right for some action on this one way or the other... let's see how things transpire

anyone else on EXS?

 

[56gsa]

Extract from article for Ivanhoe float... I'm sure I read somewhere in the past that EXS shareholders would get a slice of the float action but no mention of this in recent announcements as far as I can see...

Ivanhoe will be keeping 80% of Ivanhoe Australia (IA), implying a market value for IA on listing at the issue price of $2 a share of $625 million. IA has an inter-company loan with Ivanhoe of $74.7 million, of which $30 million will be satisfied with proceeds from the float. The remainder is earmarked for a typically aggressive exploration and development program.

IA's focus is on the Cloncurry region in Queensland, where the hunt is on for iron oxide, copper-gold deposits such as Ernest Henry (Xstrata) in the same region, and Olympic Dam (BHP Billiton) and Prominent Hill (Oxiana) in South Australia.

IA's float is expected to lead to some aggressive wheeling and dealing by the group, using its scrip as currency. That should ring alarm bells for Xstrata, which needs to secure additional ore supplies for its Ernest Henry mill.

Exco Resources ”” owned 19.9% by IA ”” has a 31 million tonne resource containing 261,000 tonnes of copper and 241,000 ounces of gold just eight kilometres from the hungry Ernest Henry mill. Xstrata has been sniffing around Exco but now faces the prospect that IA could make a scrip bid that foils Xstrata's longer-term planning for the Ernest Henry mill. Alternatively, Xstrata could strike first. That was behind Exco's 3 ¢ gain to 38.5 ¢ yesterday.

Independently, Exco is studying the feasibility of a stand-alone development that would cost $187 million and produce 20,000 tonnes of copper in concentrates and 14,000 ounces of gold annually.

http://business.theage.com.au/ivanhoe-takes-second-go-at-float-20080619-2tmd.html

 

[g13b]

anyone hear the lastest?
looks like it will be finally on the upward trend.

Does anyone have any opinions?

 

[g13b]

175% increase in indicated resources at the E1 camp, sounds good but what does it mean for us share holders?

 

[g13b]

found 55% more at the same camp as the last 175% increase.. this is good right?

Is anyone following??

 

[quinn123]

Hi, I just thought I would share some information about EXCO for anyone who is unaware of this copper/gold play.

The basic story as I see it:

Exco’s main assets:
• White Dam Project
• Cloncurry Copper Project
• 4,100km² Exploration Permits in north‐west Queensland

They are soon to be a small scale gold producer at “White Dam” which contains 10.12Mt grading 1.04g/t of gold. This will produce ~A$41M in free cash‐flow for Exco to assist them in funding their main project; the “Cloncurry Copper Project” (CCP) which consists of the E1 Camp, Monakoff and Great Australia deposits just north-east of Cloncurry, Queensland. These deposits contain a total of 51Mt @ 0.83% Cu & 0.23 g/t Au. The main deposit is at E1 Camp which contains an indicated and inferred resource of 44.8Mt @ 0.75% Cu & 0.21 g/t Au (@ 0.3% Cu cut‐off). Importantly 24.6Mt @ 0.83% Cu & 0.24 g/t Au as indicated with the remainder as Inferred.
The proximity of the mineable resources at CCP to the Ernest Henry Operation (8km to the east) presents opportunities for the potential treatment through that facility, as an alternative to the development of a standalone concentrator operation. Discussions have already taken place with Xstrata but nothing has materialized thus far. Basically Ernest Henry is running out of ore and they are thinking about going underground and will be greatly underutilizing their mill. So EXCO’s E1 deposit could help in filling the production gap.

Take this information with a grain of salt and do your own research. IMO I think these guys are an interesting play with an improving copper price. I would appreciate any feedback or discussions on EXCO.

Here are some articles/announcements from the EXCO site and HighGrade’s .

3 Aug 2009 EXS Information Memorandum
http://www.excoresources.com.au/documents/090803_InformationMemorandum_FINAL.pdf

29 June 2009 BGF Equities - Company Update - "A deal with Xstrata on Cloncurry could make it a cash cow"
http://www.excoresources.com.au/documents/090629_BGFEquities.pdf

From HighGrade’s “Uncut” today – 31 July 2009

EXCO has strengthened its case for providing copper-gold ore to Xstrata’s declining Ernest Henry mine next door in the Cloncurry region of Queensland, and if one was a punter, what price something happening one way or the other before the year is out?
Exco added five million tonnes to the indicated resources at the E1 Camp that borders Ernest Henry, with E1 now containing 24.6Mt grading 0.83% copper and 0.24gpt gold, as well as a further 20.2Mt of inferred material.
Exco managing director Michael Anderson is currently travelling this week in China and Hong Kong (ahead of next week’s Diggers&Dealers in Kalgoorlie), and his only comment was that his travels were proving “very interesting”.
What can be said without speculating is that China has proved its interest does extend way beyond Tier 1 assets. It can also be seen that Exco’s Cloncurry project now contains more than 51Mt.
We’re also pretty sure that Xstrata is taking a very close look at the colourful Cloncurry copper caper CuDeco.
Meanwhile, Ernest Henry inexorably ticks down.

 

[56gsa]

I heard that Xstrata are going underground at Ernest Henry - which may dampen the takeover premium on EXS?

Back at 22c levels which it has bounced off 5 times in the last 6 months... so interesting to see if this holds?

 

[financial chat]

up 15% this morning - what is stirring the pot?

in the last 2 weeks the stock could not be given away at 18/19c, now look.

someone must know (or be expecting) something.

 

[financial chat]

I think this is what started to stir the pot a couple of days ago.

a further buy recommendation for Exco Resources in two European Market Letters: Austria Boersenbrief (no 1 in Austria - EXS see page 6) and in the Hanseatischer Boersendienst, Hamburg (in distribution for 48 years - EXS see page 7/8.--- Two different markets: Austria and Germany but the same publishing house and therefore the same text (different target group: Austria and Germany).

I just try to translate it into English literally.

Exco Resources - real bargain - BUY

(EXS) - ISIN: AU000000EXS9 - Shares outstanding: 326,1 million - Share price A$ 0.20 (Febr. 5th, 2010) - Market cap.: A$ 65,2 million - cash: A$ 19,9 million (31.12.2009)

Based on their assets, the White Dam Gold deposit and the Cloncurry Copper project can the company be considered as strongly undervalued. Shaw Research, Sydney gives EXS a fair value of A$ 0.45/share. FD Capital increased mid January 2010 the 12 month target price to A$ 0.65. And indeed the investors in general focuses too much of a possible off take ore agreement with the resource giant Xstrata and sold their shares nerve wracking, after the Xstrata annoncement in Dec. 09. The money manager don't believe on a JV agreement with Xstrata anymore. We had a similiar situation with Hillgrove (HGO) as the shares were quoted at A$ 0.14 and we considered that price a bargain. GOLD - The White Dam operation of Exco Resources in Southern Australia goes in production as of April 2010 with a forseen annual output of 50'000 ounces. The production costs are calculated with 570 A$ per ounce. The yearly cashflow will be round 20 million US$. COPPER - The Resources of Exco from the Cloncurry Copper project in Queensland are 51 million tons ore with grades of 0.83% copper = 425'000 tons copper and 0,23 g/t gold = 373'000 ounces. Beginning of December decided Xstrata with a capital injection of US$ 542 million to finance their underground operation in order to avoid the closure of the Ernst Herny Mine (8km away from Exco's Cloncurry Project). Is just a question of time until a JV with Exco became fact. Xstrata needs in principle the Exco copper for reaching an optimum capacity of their smelting works. The first talk were not successful. Exco has no interest to sell of cheaply their "silver". Rather builts Exco an own processing plant. Even a financial participation of a copper hungry Chinese commodity company is more as possible.


Exco Resources (EXS) ISIN: AU000000EXS9 zum Schnppchenpreis
Anzahl Aktien: 326,1 Mio. Kurs A$ 0.20 (5.02.2010) Brsenkapitalisierung: A$ 65,2 Mio.
Barvermgen: 19.9 Mio. A$ (31.12.09).
Die Exco Aktien notiert zur Zeit bei A$ 0.20 - ein wahres Schnppchen. Basierend auf deren Vermgenswerten,
dem White Dam Gold Deposit und dem Cloncurry Kupfer Projekt, kann die Gesellschaft als
stark unterbewertet eingestuft werden. Show Research, Sydney taxiert den fairen Wert von EXS
Risiko-Hinweis:
Jedes Investment in Aktien ist mit Risiken behaftet. Aufgrund von politischen, wirtschaftlichen
oder sonstigen Vernderungen kann es selbst bei Standardwerten zu erheblichen
Kursverlusten, im schlimmsten Fall sogar zum Totalverlust kommen. Engagements in die
vorgestellten Aktien bergen zudem teilweise Whrungsrisiken. Alle Angaben stammen
aus Quellen, die wir fr vertrauenswrdig halten. Eine Garantie fr die Richtigkeit kann
dennoch nicht bernommen werden. Um Risiken abzufedern, sollen Kapitalanleger ihr
Vermgen grundstzlich breit streuen. Einzelne Positionen sollten nicht mehr als 3 bis 5%
des Depots ausmachen.
Hanseatischer Wirtschaftsdienst AG, Langenstcken 36 a, 22393 Hamburg,
Tel.: 040-790 60 84, Fax: 040-790 94 68
pro Aktie mit A$ 0.45. FD Capital erhhte Mitte Jan. 2010 das 12 Monatsziel auf A$ 0.65. Und in der
Tat, die Investoren fokussieren sich zu stark auf den mglichen Abnahmevertrag mit dem Gebiets-
Nachbarn, dem Rohstoffgiganten Xstrata und verkaufen entnervt - da man nach dem Dez. 09
Announcement seitens Xstrata nicht mehr an ein JV Abkommen glaubt - die Exco Resources Aktien.
Eine hnliche Situation hatten wir mit Hillgrove Resources (HGO) als wir die Aktie beim Kurs von
A$ 0.14 als Schnppchen einstuften. Heute notiert der Wert bei A$ 0.20 (4.02.10).
GOLD Die White Dam Gold Mine von Exco Resources in Sd-Australien geht im April 2010 mit
einer vorgesehenen Jahresfrderung von 50000 Unzen per annum in Produktion. Die Frderkosten
wurden mit 570 A$ pro Feinunze berechnet. Der jhrliche cashflow wird ungefhr 20 Mio. US$ pro
Jahr generieren.
KUPFER Die Exco Ressourcen aus dem Cloncurry Kupfer Projekt in Queensland betragen
51 Millionen Tonnen Erz mit Gehalten von 0.83% Kupfer = 425000 Kupfer und 0,23 G/T Gold =
373000 Unzen. Nachdem Xstrata anfang Dezember entschied den Untertageabbau mittels einer
Kapitalaufnahme von US$ 542 Millionen zu finanzieren um eine Schlieung der Ernst Henry Mine (8
km vom Exco Cloncurry Projekt entfernt) zu vermeiden, ist es nur eine Frage der Zeit bis ein JV mit
Exco Resources Tatsache wird. Xstrata bentigt im Prinzip das Exco Kupfer zur besseren Auslastung
ihrer Kupfer Schmelzanlangen. Die ersten Gesprche waren noch nicht von Erfolg gekrnt.
Denn Exco wird das Tafelsilber nicht verschleudern. Eher geht man mit einer eigenen Anlage in
Produktion. Auch eine finanzielle Beteiligung eines kupferhungrigen chinesischen Rohstoff-Unternehmens
wre gut vorstellbar.

 

[financial chat]

From Getagraph.com
SHORT TERM COMMENTARY:
Exco Resources Limited [Thursday 11 Mar. 2010]:
Exco Resources Limited is up by 3.85% yesterday from AUD 0.26 to AUD 0.27 The price has been going up and down in this period, and there has been a 12.5% for the last 2 weeks., and is up by 12.5% over the past 2 weeks. Volume also increased last day along with the price which is positive technical sign, and in total there was traded 189 756 more shares than the day before. In total there were bought and sold 367 056 shares for approx. AUD 99 105.

3 MONTH TREND
Exco Resources Limited has broken the wide and weak rising short term trend up and even stronger raising rate are indicated. On reaction back there will be support on the roof on the current trend broken, which is AUD 0.26, a level that may pose a second chance to hit a runner. According to fan-theory AUD 0.33 will be next possible trendtop level and thereby pose a resistancelevel which may not be broken on first attempt.

Support/Resistance |s
Support 1: AUD 0.26 Resistance 1: AUD N/A
Support 2: AUD 0.25 Resistance 2: AUD N/A
Support 3: AUD 0.24 Resistance 3: AUD N/A

 

[financial chat]

Confidence Grows at CCP with Maiden Measured

The subject line probably says it all in this instance.

The confidence comes not only from the conversion of resources to the measured category, but also as a result of the continued ability to add tonnage, grade, and consequently value, to the CCP. Importantly the increased value of the resources will be captured irrespective of where the ores are milled.



As mentioned in the announcement the Definitive Feasibility Study for the CCP is on track for completion later this year, as directors also look to make a commitment to a preferred development scenario within the next few months.



Progress at White Dam;
EXS are now only days away from first production. Leaching of the ore has been underway for a few weeks now and the tenor of the solutions has been increasing at an encouraging rate, which bodes well for both leach kinetics and recoveries.

Shareholders can look forward to receiving confirmation that EXS has joined the production ranks in the very near future.