kennas said:Definately for the bottom draw now. Upside would be from the drilling program around Tampakan indicating the area to have even more of the resource, and recovery of copper price (unlikely) and gold (likely). Seems clear Xstrata may be preoccupied with other projects and intigration to have the resources, time and available talent to bed this down as well. I'll look at it again next July...
Xstrata to fund Tampakan
Barry Fitzgerald
November 2, 2006
Other related coverage
XSTRATA is to pick up the running on the Tampakan copper/gold project in the southern Philippines after the project emerged from a pre-feasibility study sporting world-class credentials, with a matching capital and infrastructure cost of $US1.9 billion ($A2.48 billion) to boot.
Under an option agreement covering a 62.5 per cent interest in Tampakan with Melbourne-based Indophil and Filipino interests, Xstrata has decided to sole fund ”” at more than $2 million a month ”” further work ahead of a final option exercise decision before December next year.
The decision to sole fund for an extension of the option period rather than an immediate exercise of the option at a bargain $50 million did not surprise the market as Xstrata is busy integrating the nickel and copper assets it acquired on its recent acquisition of Canada's Falconbridge.
Should Xstrata eventually exercise the option as expected, Indophil would be left with a 32.5 per cent interest and Alsons Corp with 5 per cent. Tampakan contains 11.6 million tonnes of copper and 14.6 million ounces of gold, plus molybdenum.
But developing Tampakan as an annual producer of more than 210,000 tonnes of copper and 218,000 ounces of gold will not come cheap, with initial capital cost estimates of more than $US800 million falling victim to the industry-wide surge in costs.
Tampakan's forecast cost is split into $US1.4 billion in direct capital costs and $US500 million in other infrastructure costs at the remote site, with the latter potentially to be undertaken by third parties.
Cash operating costs are estimated at less than US70 ¢ a pound of copper after gold credits. This compares with current spot prices for copper of $US3.30 a pound.
Indophil managing director Tony Robbins said that since completing the pre-feasibility study a month ago, the work program had continued unabated. "We remain on schedule," he said.
The capital cost increase spooked some in the market, with Indophil shares weakening 2 ¢ to 76.5 ¢.
Xstrata executive general manager of project development (copper) Peter Forrestal said the PFS confirmed Tampakan as a major undeveloped copper/gold deposit.
Yeah, I'm almost with you there. I am going to wait for a takeover from Xstrata maybe. Might see what Fat Profits recommend as well. They have this in their magic hyperthetical portfolio of just 10 stocks.deftfear said:The long term prospects of this company are fantastic, but for now I am sitting out, if it gets down to the 50-60 mark I'd say I will be back in, I can't see it doing much in the near future, mining won't end up happening till 2010 or later, so I feel it's better to have money in other stocks and shift it into IRN at a later stage, just my opinion though.
Picked up a few more, this has got to be good.kennas said:Xstrata have decided to take 62% of Tampakan just ann, but the sp hasn't moved.
This is awesome news, surely!
Yeah, a bit weird. Perhaps it was just taken off peoples radars because the last ann said that theu had until Dec 07.....Freeballinginawetsuit said:Gee, its been slow out of the gates considering this was the news we were all punting on!.
Volume confirmation and momentum needs to continue, a sustained break through .85c and, alls looking good
kennas said:Yeah, a bit weird. Perhaps it was just taken off peoples radars because the last ann said that theu had until Dec 07.....]
Yep, it needs to break through 85c with volume and sustain it, shouldn't be a problem IMO as the Xstrata factor has been removed. Pretty much 'today's announcement' was the IRN punt!, and despite having time on their side, Xstrata have jumped in early. I wasn't expecting this so soon, pleasant surprise
Upside: IRN's market cap, Xstrata cash cowing and the sheer fundamentals of the Tampakan inground resource. IRN have a good repore with the Philipines government as well.
Downside: Location (Philipines) and perhaps the fundamental outlook of Cu/Au. All relative when you consider inground value and output when mined.
Regardless, IRN has a miniscule cap and is sitting on a confirmed farm in with Xstrata, on one of the largest resource bases of Cu/Au for yonks. Fundamentals will catch up with their SP, sooner than later IMO.
Agentm said:i'll take the gain.. this one completely blindsided the market.. maybe as the news spreads the market will notice,, probably be in the fin review tomorrow and get a nice boost.. long wait is over, i thought the political difficulties may have scared them off for a while, now its all systems go..
I almost thought about jumping as well as I thought there might have been some more downside with the long wait required. Lucky I held on, and lucky I saw the ann early yesterday to pick up a few more. Copper's off over night and gold relatively steady so might not push as hard as some think straight away. Might still be a chance to get some on a pullback. There's still a long long way to go for the true value of Tampakan to be realised. The Tampakan area has produced other good drilling results so there's even more scope to increase the resource. This could be a very very long term hold for me.Broadside said:bugger I sold out of this when it looked like it would take a year, well done to the patient, still plenty to go, might buy in again
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