Finders Resources Share Discussion Threads

[chipperfrd] 11/2/2010 18:51

JF,
It would be good to see this insane spread on AIM narrow a bit. But FND do appear to have slipped below all radar's - even in Oz.

I accumulated enough during 2009 so I am just holding for the long haul now. But I do intend to pick up some more DME - hopefully in the funding placement.

[p bear] 11/2/2010 15:45

You are right I've got to lighted. Please ignore.

[chipperfrd] 11/2/2010 00:01

P Bear,

Lighten up!
Just meant to be a bit of general interest about copper - not specific to FND :-)

[p bear] 10/2/2010 19:20

Who gives a toss what the SHFE/LME arb is. It's been there for ages with most base metals, but reality check you need to factoring delivery costs, import duty and technically need a registered brand. Plus phycial premiums in the region are high enought to cancel the effect. Not really relevant to FND.

China's appreciate for Cu - totally relevant. XTA/ENRC best buy for me, happy to have a few hear with a higher risk/reward ratio.

[chipperfrd] 10/2/2010 18:55

Perhaps this is a bit fanciful - but quite interesting anyway:

[coffeelito] 10/2/2010 17:56

jonathan, the macro picture is all very well but is Finders really going to be a good bet or just another in the endless parade of "exciting" tiddlers that never go anywhere and one day go bust, having wasted our time, money and "energy" on it? Anyone who buys in with this awful spread has already lost a lot of money.

[jonny flame] 10/2/2010 15:18

While metallurgical coal probably represents the better short-term prospects of all the company's commodities, Teck believes copper has the best medium- to long-term outlook, he told analysts and investors on a conference call.

Head grades at several large mines around the world are declining, which will put pressure on production levels, he said.

"They are having to move more rock to produce less metal. And there aren't that many large projects available...exploration hasn't been that successful globally.

"So we think that over the next ten-year period if copper demand grows even at a moderate rate, that the mining industry will not be able to keep up."...

[hectorp] 01/2/2010 11:08

Wetar project - have read the details from the other day and most pleased with the situation. Wetar is the company-maker IMO.
Should return gross over $100M value of copper at current prices during open- cast lifetime, with the possible extensions to come later.
Holding my stock on the Oz. market.
H.

[coffeelito] 01/2/2010 08:10

what's up with the share price ?

[tarnow] 31/1/2010 21:37

Ok. Thanks guys I will order the Insiders Guide as well :-)

[jonny flame] 31/1/2010 09:29

Hi Tarnow,

I would recommend reading both if you are serious about improving your knowledge (like me :)). I have read a few books on Soros and Buffett, if you haven't read any of Jim Rogers books I would take a look at them, 'Hot Commodities' & 'A Bull in China' are good reads, his other books are also very entertaining and interesting.

Thanks guys!

[chipperfrd] 30/1/2010 21:43

tarnow,

I recommend 'An Insiders Guide to the Mining Sector'. I have an edition from a few years back but it does cover quite a lot of ground and is well worth reading for insight into both the potential and the pitfalls of mining investment.
Chip

[tarnow] 30/1/2010 19:54

Hi JF, I actually ordered Mining Valuation today :-) Chip made me realize I need to educate myself on mining. Its not enough just to know about commodity trends, P/E ratios, etc. I ordered that one because it included info on energy(oil) stocks as well. As you have both, do you think its worth buying the first book (Insiders Guide)as well?

I have read lots of books on investing/money/stock markets in the last year. Two I would start with are The Little Book of Value Investing by Christopher H.Browne & The Winning Investment Habits of Warren Buffet & George Soros by Mark Tier.

[jonny flame] 30/1/2010 18:22

Excellent discussion guys!

Hi Tarnow, like you I want to understand my mining shares better, for Christmas I bought myself the following 2 books, I'm hoping that they will at least help to develop my overall knowledge. Thought you might appreciate me passing on the info, if anyone else has read any books that they would recommend I'd love know what they are;





Additionally, in regards increasing the life of mine, as we know FND have Meron which could add to the mine life as stated below;

"In addition there is a third deposit Meron, located 2 km from Kali Kuning. This prospect has a potential size of 1mt @ 2.3% Cu (Non‐JORC compliant) based on historical drilling results from the previous gold mining operation".

They also have a number of other tenements on Wetar which I suppose over the next few years will be drilled and potential for economic resources evaluated and defined, which may or may not lead to further increases in the life of the project. See P.15 of the company prospectus;

[tarnow] 30/1/2010 15:10

Thanks Chip. Like Goldrush just posted. Wetar is good enough on its own. The EPS from 2011 onwards looking good. And then there is the possibility of Meron increasing the resource and mine life over the existing nine years. I think I get the idea about Ojolali. Don't come to any conclusions based on 750m of drilling, even if initially it doesn't look great. It takes a lot of drilling and research to come up with a full accurate picture. We are just at the 'inferred' stage. But we should have a more accurate idea sometime this year, because the plan was for a mine in 2011. Thanks for the education in mining Chip :-)

[goldrush] 30/1/2010 14:53

chipperfrd

Great summary and ultra concise.I too believe the Wetar is good enough and providing they deliver as planned the share price should take care of itself....IMHO

Better grades from resource drilling on Ojalali is a great uplift if they come through.

Again IMHO

g

[chipperfrd] 30/1/2010 14:10

tarnow,

Grade results alone are of little value in estimating possible economics, as my earlier examples tried to demonstrate.

Basically, you need to be thinking in terms of overall volume of the resource (ie tonnage of ore at an average grade) in order to arrive at an amount of contained gold. It then comes down to how many tonnes can be mined and processed per year and at what cost per tonne (and more specifically per oz).

So miners need lots of drill holes in order to work out the 3-dimensional scale of the deposit. For an open-pit proposition this will entail drilling that will progressively move out from a target area in order to find the edges of the mineralisation (ie grades drop too low) and then having scoped the overall area they will carry out in-fill drilling (close spaced) in order to improve the confidence in the amount of contained metal. So you will see numbers quoted for 'inferred' (low confidence), 'indicated' (higher confidence) and 'measured' (high confidence) as drilling continues.

Obviously there is a depth component and sometimes you will see 'open at depth' which indicates that the drilling stopped whilst still encountering gold mineralisation. There is a limit to how far down an open-pit can reasonably go (due to slope mechanics, etc) so sometimes there will be a surface open-pit operation that gets followed by an under-ground operation below the pit limits.

So just getting a drill hole in isolation is not that useful and just focussing on a specific grade from 1 drill hole is even less useful. You must have 3-D info in order to fully get a handle on what may be contained in the ground and only from that info can the overall economics of a project be assessed.

As for FND: I only value it on Wetar as there is not enough info on the gold prospects to place a value.

Based on their likely production growth I get:

CY2010 - EPS of 2.26p
CY2011 - EPS of 17.3
CY2012 - EPS of 27.7
CY2013 - EPS of 29.8

I would apply a PER of 9 to those earnings in order to arrive at possible forward share price.
Chip

[tarnow] 30/1/2010 13:43

Thanks Chip. That helps a lot. Just the kind of concise information I was looking for. I did some more research last night, and came across a minimum figure of 5g/t Au to consider possible mining, although it didn't give depth of ore. Also I compared these results to VGM another share of mine. They are an underground mine in Fiji, but have just conducted some surface drilling with the intention to increase their resources. Their figures were much better. Then I looked at Kingsrose mining results. Which as we know is the mine 30km south of Way Neki, and the project FND is hoping to emulate. They had drill results of 24g/t Au +. From the RNS 4th Dec, the next stage is about 750m more drilling on other prospective sites e.g. Jambi. Lets hope these results are better :-) I brought this share on the basis of Wetar. With the hope of Ojolali being the great bonus. Where do people think the share price can go if Ojolali turns out to have nothing viable? In other words, with just the Wetar project. The plan for Ojolali was a low cost open-pit mine. What if they came up with a viable mine, but it would have to be underground. Does FND have the funds & knowledge, (I'm sure not the equipment) to make this an option? Or would it be a non-starter. Thanks again Chip :-)

[tarnow] 29/1/2010 19:00

Hi Guys! Can anyone give an interpretation of the drilling results. I don't understand the technical side. So if someone does, or can recommend a web page/site that helps you learn I would appreciate it. Good news about 7 tpa

[someuwin] 29/1/2010 07:44

Friday, January 29, 2010

Finders Resources ticks off "positive" Wetar Copper Project DFS

Finders Resources (ASX: FND) ticked off a Definitive Feasibility Study for the Wetar Copper Project during the December quarter, which was positive with estimated life of mine operating costs of US$1.00/lb Cu.

The Wetar copper resource is contained in 2 separate massive sulphide deposits, Kali Kuning and Lerokis in eastern Indonesia which are located within 3km from the coast and suitable for open pit mining.

As scoped the project DFS arrived at an Net Present Value of US$240 million pre‐tax at $6,500/t Cu, with a a total funding requirement of up to US$118 million.

The DFS envisaged three stages of project development, with Stage 1 being the expansion of the current 1,800 tpa copper cathode demonstration plant to 5,000 tpa, followed by Stage 2, final expansion to 23,000 tpa copper cathode utilizing the Whim Creek SX‐EW plant. Stage 3 is the development of the Lerokis pit and haulage of Lerokis ore to the Kali Kuning plant to maintain copper cathode production at 23,000 tpa.

During 2009 Finders constructed and operated a 5 tonne per day SX‐EW demonstration plant to optimise process design and provide data required for the Definitive Feasibility Study. The test heaps are at heights similar to commercial operations worldwide and the SXEW technology being used is industry standard. SX‐EW technology is currently responsible for approximately 22% of the world's copper production.

On 23rd December 2009, Finders completed the outright purchase of the Whim Creek SX‐EW plant from a subsidiary of Straits Resources Limited (ASX: SRL).

The Whim Creek SX‐EW plant can produce up to 18,000 tonnes of copper cathode per annum and is well suited to Finders' needs at the Wetar Copper Project.

With the plant, Finders can move closer towards development of the full scale project, by providing certainty of both supply and timing for key components for the development, as well as significant cost savings compared to the purchase of new equipment.

The Whim Creek plant is currently located in Western Australia.

Finders has already commenced dismantling work and preparations for transportation to Wetar.

The Expanded Demonstration Plant project delivery study has been completed. A revised scope contemplates a 7,000 tpa cathode capacity (up from 5,000 tpa). This will use the Whim Creek plant to reduce capital requirements. Board approval is scheduled for next quarter.

At Finders' Ojolali Gold‐Silver Project, diamond drill testing of new areas of epithermal gold silver veining at Way Neki is underway.

The strategy at Ojolali is to increase the oxide gold resource to +300,000 Oz Au, to provide the basis for a low cost 30‐50,000 Oz gold per year open pit mine based on the Jambi oxide resource, and to use the cash flow from this plant to fund exploration for additional resources and progressive expansion of the project.

Initial results include: 1 m at 8.13 g/t Au from 60.7m in WNK04 and 6.25m at 1.3 g/t Au and 24 g/t Ag from 14.7m in WNK01.

A detailed remodelling of geological controls for the Jambi oxide gold deposit is now complete.

As at 31 December 2009, Finders had $7.6 million in cash.

A total of 13,421,439 fully paid ordinary shares were issued to a subsidiary of Straits Resources Limited in consideration for the acquisition of the Whim Creek SX‐EW plant.