Phoenix Copper Share Discussion Threads

[onedayrodders] 15/5/2020 20:55

thanks goldrush .. on my watchlist.. will need another play to work out and sell hopefully before good news here

[goldrush] 15/5/2020 15:47

$9,000 Gold and Triple digit silver (over $100 Silver) Forecast....Check out Kitco.com

[goldrush] 15/5/2020 15:46

Duplication.

[goldrush] 15/5/2020 15:37

Looks like someone was desperate to sell 30k shares....must be chasing CV19 shares....sure there is excitement but dangerous

Providing the drill bit does the talking in the next month, with Silver going in the right direction this could be a niche silver producer in USA before long....But it will need patience not a 24 hour trading horizon....IMHO

[zaphod99] 15/5/2020 08:23

Silver heading in the right direction.....now over $16/oz.

What was it that analyst said?

"PXC’s share price is highly geared to the upside thesis for silver (and copper), with each $1.00/oz adding an estimated 6.2p-6.3p/share."

Obviously it works in the opposite way with a falling silver price but the outlook for precious metals looks good in the short, medium and long terms.

[zaphod99] 14/5/2020 16:29

investorman33 - thanks for sharing that link to the interview with Paul Mylchreest of Hardman & Co.



Definitely well worth a listen!

Here's an extract of what he had to say when he was asked why the Empire has world class potential........


"Empire is actually the site of a former producing copper mine which was only shutdown due to US entry into the 2nd World War.

Between 1901 and 1942 the mine operators targeted the underground sulphide ore and from the detailed mine records that were kept, they extracted 364,000 tons of ore, from which they recovered 3.64% copper.

Now that recovery rate is quite something and it needs putting into perspective. So just to make a couple of points here, recovering 3.64% copper in that era implies that the ore grade was probably somewhere between 6% and 8% and let's compare that with the average ore grade in new copper mines today, which is somewhere between 0.5% and 0.6% with slightly lower recovery.

So there is very significant potential to follow the veins of what was very high grade sulphide mineralisation in the old workings further underground and access to those old workings should substantially reduce the cost of exploration drilling.

So far, there's been very little drilling at depth but in the 2018 drilling programme the company did achieve some initial sulphide intercepts at more than 100 metres depth and there was one drill hole out of only 3 deep ones that were drilled that intercepted 4.6 metres of 3.88% copper equivalent and 1.5 metres of, wait for it, 7.16%.

Should also add, there's a lot of lateral potential now given that the land package has been extended by an additional 4,500 acres, that includes 3 other former mines as well as the Red Star and Navarre zones and in all, only about 1% to 2% of the mineral system has been explored so far."

[investorman33] 14/5/2020 15:25

DD

Might be worth reading the WH Ireland one again, in it they calculate the npv of Empire mine and then only bring in 30 % of it to their value of the company, that derisks it significantly for financing and for Red Star only bring in 10% to their valuation of the company, this time derisking it for getting the resource in place and financing risk.

So opportunity is to buy in now or wait until financing is in place by which time the 70% discount on Empire will have largely gone and the 90% discount on Red Star largely gone.

And with the share price at around 20p now versus their fair value if 34p, there's another level of discount which will have gone.

But I'm just as happy if you want to buy at say £1 in the future or 20p now - depends on your appetite for risk and spotting bargains ?

[seagreen] 14/5/2020 14:33

Although healthy buying by Directors after the recent results would indicate a modicum of rolled up hands and possibly a smattering punching of the air.... for now there is great hope....

[dozyduck] 14/5/2020 13:58

Firery Knickers ! - I've been monitoring broker reports for over 25 years. They always over-hype and (for mining and project related shares) use the 'easy' NPV approach - for which there is no logic. It takes time to do proper forecasts which are to model the likely funding scenarios and work out what the institutions will pay to raise the build costs. Most mining analysts are geologists (which is why their reports always pad out with geologists detail - something totally irrelevant to an investor who will rely on the required technical reports. They are not economists or share value specialists - Why do you suppose the institutions have their own 'buy side ' analysts and never rely on brokers reports - which are purely for the birds (aka private investors and press tipsters)

[littlepuppi7] 14/5/2020 12:02

Time to move to JKX. Not ridden the oil price rally at all yet, Unlike here, no debt, p2 reserves over 100m and 10,000 boepd production. Probably the biggest bargain out there at 30m mkt cap..15m USD in the bank at last count and NO DEBT. Not many shares avaliable at the current low price so should move pretty swiftly... Also hold a 10% stake in UNB, Ukraines biggest O+G producer probably worth 30m plus....

Summary of recent expectation smashing final results

FINAL RESULTS

FOR THE YEARED 31 DECEMBER 2019

JKX Oil & Gas plc (LSE: JKX), announces its results for the year ended 31 December 2019.

2019 Highlights

-- Revenue up to $101.7m (2018:$92.9m) thanks to increased production volume in Ukraine, despite lower gas prices.

-- Profit before tax up to $30.4m (2018:$14.0m).

-- Cash generated from continuing operations up to $41.4m (2018:$37.3m).

-- Year end cash position of $20.6m (2018:$19.2m).

-- Final bond payment made February 2020, making the JKX Group debt free.

-- Average daily production up to 10,748boepd (2018:8,937boepd).

-- In Ukraine, production up more than 50% to 5,584boepd (2018:3,677boepd) due to continued execution of development plan.

-- In Russia, well workover programme completed and average production maintained at 5,158boepd (2018:5,169boepd).

[pantsonfire] 14/5/2020 12:00

DozyDuck, I am not sure that WHIreland and Hardman would agree with you. The researches reflect the real world, and have to make estimates, for the future is just that. The analyses are based on real data, real results, and put together in a professional manner, and express their confidence in the management style and their competence to raise finance, ie funding risk, so I think they covered this aspect, albeit obliquely.
But we are all looking at this risk with open eyes. If we wait to buy when the funding is announced, the share would be pretty much totally derisked, and would not be at the level where it is today, and more like the 140p quoted by WHIreland. You have a choice. Wait for the derisk, and pay 140p, or jump in now, if you have confidence in the resource and the quality of the management to take you there. I am for the latter, as are the majority of the long term shareholders here, and you can see that by their posts.

[zaphod99] 14/5/2020 11:50

Wise words DozyDuck and any sensible investor would take your points into account.Waiting for the financing to be raised makes sense for those who are more risk averse but happy to come in later at what would obviously be a much higher share price than today.The continued buying by the directors might give an indication of their level of confidence.

[zaphod99] 14/5/2020 11:45

Also worth noting is this statement....

“PXC’s share price is highly geared to the upside thesis for silver (and copper), with each $1.00/oz adding an estimated 6.2p-6.3p/share."

If Bank of America’s forecast of $20 per ounce silver within 12 months is achieved it potentially adds more than 24p per share on that alone, i.e. more than double the current sp!

[dozyduck] 14/5/2020 11:42

Two research reports on the same day! Who'd a' thought it ? Both omit the key question for shareholders - Funding ! Without which its impossible to value the shares. To put forward 'DCF's is a cop out. They are never reflected in a share price and don't take account of the funding cost of any construction debt - in this case hoped will be 80% - or of any share dilution ! For the latter to rely on some finger-in-the-air "Risk factor" is also a cop out. (Even if there is no dilution and a mine is fully funded, the theoretical DCF based value is hardly ever achieved unless the discount factor is over 12%)
I'm sure this is an excellent prospect, and no doubt will be funded and built. But chasing such a share just after a 'broker paid' 'research report' is merely to fit Mark Twain's definition of a mining investor. Wait until the construction funds are raised.
The only 'paid-for' researcher who would have made a proper (if incomplete) stab at forecasting the share price (which will be 'based on' (but not equal to) the NPV 'as seen by the shareholder - and not as seen 'at the project' - is Edison (No Connection)

[zaphod99] 14/5/2020 11:39

Indeed investorman33!One small but significant correction to your post.....Hardman's "cautious" valuation of 31p is for the Red Star project only and does not include anything for the Empire open pit copper/gold project.

[investorman33] 14/5/2020 11:38

Link is to an interview with the analyst who wrote the Phoenix research on the company.

Paul Mylchreest, the analyst has a decent track-record, reaching the top rank in analyst surveys in several sectors.

Its a good listen

[investorman33] 14/5/2020 11:15

Zaphod

Thanks for posting the link to the Hardman research report - that's another really serious piece of research by a really good analyst. First two detailed bits of research on Phoenix EVER, and released on the same day !

The Hardman report is probably MORE bullish than the WH Ireland report as it gets to a 31p valuation on Red Star and Empire copper/zinc but gives no or minimal valuation to :

- Empire gold/silver extracted by Merrill Crowe process
- Cobalt projects
- Navarre Creek gold project

So there is huge upside to come - and I'd pretty sure Phoenix should be able to produce the internal feasibility study/project economic model for the Empire gold/silver within months probably, certainly by end of this year. So that's a big increase in the Hardman valuation just months away !

[investorman33] 14/5/2020 10:54

Another thing out of the WH Ireland report is the valuation of the gold/silver part of Empire being valued at £6m.

I'd guess that Phoenix will be able to release their internal feasibility study and economic model of the project extracting the metal via the Merrill Crowe process, and that by itself will put a much higher value on the project as its then a project just 'waiting to go', far less risk on the valuation with the feasibility study completed.

Again that valuation will be a multiple of the £6m its included in the report.

And surely Phoenix will release that internal economic model within months !

Happy days for Phoenix - what's not to like very much.

[zaphod99] 14/5/2020 10:51

A couple of notable points from the Hardman report.....

"Our DCF valuation is 31p/share, based solely on the silver mine, a cautious (for now) 15% discount rate and a long-term silver price of $19.00/oz. PXC’s share price is highly geared to the upside thesis for silver (and copper), with each $1.00/oz adding an estimated 6.2p-6.3p/share."

----------------------------

"Major upside potential: Only ca.1% of Empire’s potential ore system has so far been explored. Geologically, the deposit shows similarities with Antamina in Peru, the world’s largest skarn-hosted copper mine. Further work will confirm whether there are additional copper-tungsten-molybdenum porphyry resources at depth."

----------------------------

"In communications with investors, PXC’s management team notes that Empire is located in what it sometimes refers to as “elephant country” – pointing to the many large mines in the region. Examples include:

► Bingham Canyon Mine – this has produced more copper than any mine in history;
► Thompson Creek – previously one of the largest molybdenum mines; and
► Coeur d’Alene District – a prolific area for silver-lead and gold-copper mines. "

[investorman33] 14/5/2020 10:43

Been reading the WH Ireland report - one snippet really caught my eye, Red Star is only included at a £4m valuation out of the £34m they come to for the company.

If the drill results now underway along a known vein come up with anything like the initial 3 holes drilled, that valuation is going to be multiple times the £4m and ratchet up the fair valuation of the company by itself....and that's just a few months away ! And only weeks away from the first assays being announced !

[dave4545] 14/5/2020 10:23

Testing the recent high now, if it breaks that I cannot see why it will not head up to 30p

[goldenlady] 14/5/2020 09:39

Thanks Manouk2 and pants for your replies. I’m in. Great research isn’t it. I can’t understand why this isn’t flying after a report like that?