GCR - Golden Cross Resources

[YOUNG_TRADER]

Qld Govt Historic JORC 500Mt's@15%Phosphate

GCR's JV partner is Legend International a major Phosphate player in Aust, see http://www.lgdi.net/

Now Legend has all up around NET 1.3Bt's@15% Phosphate (1.5Bt's but not all are 100%)

NOW Legends current mkt cap is $500m AUD see http://www.otcbb.com/asp/Info_Center.asp LGDI (including unlisted options and AUD/US conversion)

$500m With 1.3Bt's@15%Phosphate = 40c per tonne ore @15% Phospahte

GCR has 20% of 500Mt's@15%Phosphate = Net 100Mt's

@ 40c/t = $40m 6.3c GCR

 

[Gekko]

Qld Govt Historic JORC 500Mt's@15%Phosphate

GCR's JV partner is Legend International a major Phosphate player in Aust, see http://www.lgdi.net/

Now Legend has all up around NET 1.3Bt's@15% Phosphate (1.5Bt's but not all are 100%)

NOW Legends current mkt cap is $500m AUD see http://www.otcbb.com/asp/Info_Center.asp LGDI (including unlisted options and AUD/US conversion)

$500m With 1.3Bt's@15%Phosphate = 40c per tonne ore @15% Phospahte

GCR has 20% of 500Mt's@15%Phosphate = Net 100Mt's

@ 40c/t = $40m 6.3c GCR

Thanks for the reply. I'll continue to look into the company tonight but it looks very interesting on first impressions. As we all know, its certainly in the right sector. And that means a lot.
One question. Did they farm out a little too much?

 

[YOUNG_TRADER]

lol this is becoming a little bt like ping pong with your questions

Re did they farm out too much? Whose to say, I think it admirable that the company realised it is not a Phosphate player and thus farmed the project out to Legend, an actual Phosphate player, I would have prefered if they say kept 305 or 40% but then again perhaps 80% was what it took to get Legend on board, who knows,

One things for sure, GCR reminds me alot like CUL, see CUL was a small explorer with many mnay projects that provided alot of promise and potential, however it was its 30% carried interest in its Iron Ore project with AQA that made me really bullish as AQA were cleary going to develop their Pilbara Iron Ore area into a huge Fe porject,

Similarly I can see Legend following in the footsteps of Incitec and developing thier Potash projects which will take GCR along for the ride,

Whatever the case I have shown why I believe on aan EV basis given Legends current Mkt Cap GCR's interest at Mt Isa should be worth 6c ish alone

add to that the 10% of the NPV at Copper Hill and you get another 10c =

So the total EV I get from Copper Hill and Mt Isa alone is 16c


Now the company has like 4-6 other projects JV'd out to ZFX, TRO, CVRD/INCO and a few others, as well as this the company also has about 3-4 exploration projects in NSW around Broken Hill and in Qld and it doesn't stop their the Company has also 100% of the Uranium rights in its Qld Mt Isa assets (which is where Summit has dicovered huge amounts of Uranium), the Company has also acquired more Uranium projects in Canada and Copper/Gold projects in South America

With about $4.5m in cash and $2m + in listed shares and cash royalties to come the company is well funded

I don't know about you but theres an awful lot of value in this company

EVEN a 50% EV value for Mt Isa ie 3c + 5% NPV value for Copper Hill STILL = 8C

 

[Whiskers]

With about $4.5m in cash and $2m + in listed shares and cash royalties to come the company is well funded

I don't know about you but theres an awful lot of value in this company

EVEN a 50% EV value for Mt Isa ie 3c + 5% NPV value for Copper Hill STILL = 8C

Good to see you on board YT.

Maybe you have brought along the midas touch that this one needs to realise it's value.

 

[smurfette]

Hi YT,

Interesting read. Can't believe those values! Would you say 8c as a price target or 16c. I know a lot depends on what the market will do. Some believe the subprime has more to go and more Opes Collapses will occur. I'm undecided on this and think the market may have pulled through the worst.

I must admit it is a shame they have given 80% of their Phosphate away

Smurfette

 

[YOUNG_TRADER]

Smurfette you answered the question yourself,

The mkt will value this as they see fit, all I can say is like IRC and ACS of late I can see alot of fundamental value in this stock and thus believe in my opinion it is fundamentally undervalued

I have already stated I believe attributing 5%-10% of Copper Hill NPV is prudent = 5c - 10c

And an extrapolated EV for Mt Isa = 6c

So being ultra conservative I'd say at 6c your only paying for Mt Isa EV below well your not even paying that

If you add whatever % of the NPV you think Copper Hill deserves ie 10% 5% 2% 1% (roughly each 1% = 1c) to the 6c from Mt Isa EV you start to come up with a target price

Keep in mind the company has about 10 other projects which I would say add another 2c - 4c on their own

I see so much value no matter which way you slice it, what the mkt does is up to it, sooner or later value is either reflected or destroyed, we shall see

 

[Gekko]

Hey Smurfete I thought that too re giving away 80% but I considered what YT said and agree, 20% of a profitable mining operation is better than 100% of a valuable deposit lying in the ground. Depends on how you look at it really. That had to give to get (to get Legend on board with them)

 

[Uncle Festivus]

Good to see you on board YT.

Maybe you have brought along the midas touch that this one needs to realise it's value.

Hey Whiskers, just shows how much influence we have here . YT comes on board and way it goes . Interesting study on market sentiment and timing.

 

[YOUNG_TRADER]

Hey Uncle and Whiskers,

Yeah I can't believe this has been flying under the radar

On its Phosphate potential or Enterprise Value alone its undervalued

with all the interest of late in Agri stocks I can't believe a company with a resource of 500Mt's@15%Phosphate 20% carried by a large player being Legend can sit at such a low level

So now that I have somewhat explored Copper Hill and Mt Isa Phosphate I'll dig up a bit on their other projects

 

[smurfette]

Hey guys,

I can see what you mean. I mean 20% of profit is probably better than 100% of nothing, but then if we did the whole "if but and maybe" whose to say GCR couldn't have developed the mine themselves?

I was hoping to get some cheapies this morning so it looks like i haven't learned my lesson from IRC. Sitting with a sore bum from being so tight

Smurfette

 

[YOUNG_TRADER]

I suppose the next interesting project to talk about is one of GCR's Aussie Qld projects BOWEN

GCR appears to be targeting Gold and Silver here

Bowen (Qld, 900 sq km, GCR 100%, gold & silver)
Sampling and mapping is underway, and an office has been set up in Bowen. Exploration work is targeting porphyry-related bulk tonnage gold deposits and epithermal gold-silver deposits, with potential for a Silver Hill-style high-grade gold-silver discovery. Conquest Mining’s Silver Hill resource at nearby Mount Carlton is reported to contain 1.3 million ounces of gold, 45 million ounces of silver and 66,700 tonnes of copper.
GCR will follow up all prospects at Bowen, including:
• previous drilling by WMC on the Mt Cavana tenement, which returned
8m at 3.2 g/t gold, including 1m at 15.4 g/t gold; and 4
• a zone of highly altered, silicified, brecciated and gossanous rocks within a porphyry-style environment at Matrimony Ridge, located within the Mt Mackenzie tenement, where rock chips returned assays of 6.3 to 16.8 g/t gold and 105 g/t silver over a 100m long zone at the brecciated contact with a dacite dyke.

I know the discovery and increased JORC by CQT at Mt Carlton caused quite a stirr last year, I suppose this makes GCR's exploration here look very interesting especially since the company itself has said the Geology it has at its projects is similar to Mt Carlton

 

[Gekko]

Hey YT I remember that CQT thing last year I think the speculator was the one who was hearalding it as a major find didn't seem that impressive to me to be honest I mean it was a great deposit but I didn't really see it as bing the next Olympic Dam or whatever

Anyway thats CQT, at least for GCR its another positive do they have an idea of a target size there or anything?

 

[YOUNG_TRADER]

Gekko all I know is what they have said in the qtrly (I inserted the extract) and in that image, I don't think they have any target sizes other than to emphasize the geological similarities to CQT's Mt Carlton Copper/Gold/Silver deposit

Another interesting project is their Mt Isa Uranium as this is where Summit SMM has firmed up 60-70M lb's of Uranium and has attracted the attention of Areva and PDN, it is an elephant area for Uranium and GCR retains 100% of the Uranium rights here

This is also where the Phosphate is and thus there is ample infrastrucutre and also an exisitng Phosphate mine (not sure whether its operational or historic)

 

[YOUNG_TRADER]

Well looks like there was a bit of interest in the stock today

Still lookiing cheap to me on EV basis,

For interest sake I crunched the I.G.V.'s and I was blown away as they say a stock should usually trade at 10% of I.G.V. I prefer to use 1% to be conservative

Mt Isa
Mt Isa PHOSPHATE:
500Mt's@0.15%P = 75Mt's of Phosphate

The current spot price for Phosphate is $350-$400 US/t = say $400 AUD roughly

So I.G.V. Mt Isa = 75Mt's x $400/t (current Phosphate Price) = $30BILLION now even though GCR 20% they have a net attributable amount of $6Billion


Copper Hill
Copper HIll contains 1.2Moz's Gold 420kt's Copper
using current spot prices ($1000 AUD gold and $4.40 Copper)

I.G.V. Copper Hill = $5Billion


And yet the mkt cap is still $25m

1% of I.G.V. ($11Billion) = $110m = 17c+ GCR but thats just my thoughts

 

[Gekko]

Well looks like there was a bit of interest in the stock today

Still lookiing cheap to me on EV basis,

For interest sake I crunched the I.G.V.'s and I was blown away as they say a stock should usually trade at 10% of I.G.V. I prefer to use 1% to be conservative

Mt Isa
Mt Isa PHOSPHATE:
500Mt's@0.15%P = 75Mt's of Phosphate

The current spot price for Phosphate is $350-$400 US/t = say $400 AUD roughly

So I.G.V. Mt Isa = 75Mt's x $400/t (current Phosphate Price) = $30BILLION now even though GCR 20% they have a net attributable amount of $6Billion


Copper Hill
Copper HIll contains 1.2Moz's Gold 420kt's Copper
using current spot prices ($1000 AUD gold and $4.40 Copper)

I.G.V. Copper Hill = $5Billion


And yet the mkt cap is still $25m

1% of I.G.V. ($11Billion) = $110m = 17c+ GCR but thats just my thoughts

$25mn capitalisation on $11bn of projects of which $6bn are mt isa phosphate is good enough for me. I bought a bunch at 0.042 during the afternoon and will add. The current value attributed doesnt come close to justifying the phosphate that they have in Mt Isa. GCR compare awfully favourably to rwd, mak and any other. Copper Hill looks promising, but its the phosphate that gets my attention.

4.2cents to...(17cent ?) is good enough for me.

 

[YOUNG_TRADER]

Hi guys some interesting Agri info from the RWD thread


Courtesy: The New York Times

The Food Chain: Fertilizer Crisis

http://www.nytimes.com/2008/04/30/bu...hp&oref=slogin

Video @...

http://video.on.nytimes.com/?fr_stor...eef7bf21aafa0c

Worldwide Fertilizer Consumption Demand is on the increase...see the attached file for a World schematic.

A few people have been discussing the consequences of a reduction in arable land. The NY Times article points to increased desire for efficiency to generate higher yields, a direct result from increasing fertilizer use across developing economies.

 

[Gekko]

Hey YT picked up a few more of these gooies this AM
interesting read all this food shortage stuff well I should say scary as the what ifs of not enough food are well scary to say the least.

So 17c here we come hey? Once the market is more aware of the company, it will push through easily.

 

[Whiskers]

Worldwide Fertilizer Consumption Demand is on the increase...

Yeah, I've had an interest in the horticulture industry for a long time and don't I know it.

Phosphate especially, but also the cane farmers are complaining about the rising cost of urea.

PS: I wonder if shareholders will get a discount off the fertiliser ... like some companies provide for shareholders who deal with them, and sugar mills used to give for bags of raw sugar years ago.

 

[Fed23]

currently down 11.9%

I think its time to enter this stock.

Hope that once I enter it doesnt drop more like STB

 

[YOUNG_TRADER]

Hey Whiskers Horticulture hey? Sounds like you might have the inside gossip for us on the Agri sector

Well someone out there was nervous about the mkts or something because a whole heap of GCR were just dumped, I can't get over how cheap this stock is, it baffles the mind

Gekko the 17c was a figure based on 1% of the I.G.V. of the deposits, its not really my prefered target setting tool

For GCR I'd say the best bet is to use the Extrapolated EV for Mt Isa which is 6.3c ish

Then add whatever % of the NPV for Copper Hill you like, basicially the NPV = $1 GCR however there are considerable development risks and thus this NPV must in my opinion be heavily discounted so basically you should look at the Copper Hill deposit and determine what % probability you would give to the company achieving its NPV

What really baffles me is MNM today announce that its reviewing its licences near MAK and its SP bolts up 60% having risen probably 300% (ie from 10c) over the past few weeks, GCR on the other hand has 500Mt's of Phosphate bearing Ore and is in a JV with Legend and yet is so cheap