DESCRIPTION: Copper Mountain Mining Corp. is a Canadian resource company that owns 100% of the Copper Mountain Project located 15 km south of Princeton in southern BC. The company recently completed an independent feasibility study that confirmed the economic viability of bringing back into production a conventional open pit mine with a 35,000 tons per day mill. The mine, a former producer of just under 2 billion pounds of copper, with a current resource of 5 billion pounds of copper* is designed to produce approximately 100 million pounds of copper per year in a copper concentrate with gold and silver credits by mid 2011.A photo gallery and video of projects are available.
*These resources estimates are taken from the company's updated NI 43-101 resource report announced April 16, 2009. Peter M. Holbek, P.Geo. is the Qualified Person as defined in NI 43-101 for reporting purposes.
The information provided below is based on the most recent information we have received from analysts, newsletters and other contributors to Streetwise Reports' The Gold Report or The Energy Report. We encourage you to visit the company's web site and call the company for more specifics on this company before you decide to invest.
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Canaccord Capital, Morning Coffee
(06/01/10)
"Copper Mountain moved up on news that Similco Mines Ltd. (75% Copper Mountain, 25% Mitsubishi) has executed a formal financing agreement for US$322 million with a consortium of Japanese banks. The Similco project is located in southern B.C. and has a current resource of approximately 5 billion pounds of copper. While a financing agreement was expected as the company had said it was looking to bump up total debt rather than entering into lease agreements, it does remove any uncertainty surrounding the terms. The agreement consists of a US$162- million senior credit facility (LIBOR plus 2%) provided by the Bank of Tokyo-Mitsubishi UFJ (MTU) and Mizuho Corporate Bank (MFG). In addition, the Japan Bank for International Cooperation (JBIC) will provide a US$160-million term loan (LIBOR plus 0.551%). The company suggests it will enter into interest rate swap hedges as a requirement based on the loans variable rate structure. There are no commodity hedging requirements. The loan term is 12 years. The senior loan is secured by an export credit insurance supplied by Nippon Export and Investment Insurance. Concurrent with this announcement, the company indicated that it remains on track for full production in June 2011. Copper Mountain is one of Canaccord Genuity Mining Analyst Wendell Zerb's top picks for developing copper companies. He expects production of about 100 million pounds copper (75% net to CUM) beginning in late 2011."
The Gold Report Interview with Gianni Kovacevic (04/14/10)
“Copper Mountain is a company I’ve always supported. It’s just a fantastic British Columbia story. They’re going to be producing copper within 12 to 14 months. That is fantastic news both for the province and for the copper world. It’ll be about 50,000 tons a year production. They’ve got a great partner in Mitsubishi Materials Corp. Let’s not forget they’ve had $170 million worth of infrastructure that was there because of the past production. This company had a market cap of maybe $10 million at the low. There was just a tremendous amount of deep, deep value there. The stock’s up 1000% from the low, so it was tremendous story.”
View Entire Article: Gianni Kovacevic: Planes, Trains & Automobiles (& Rickshaws)
The Energy Report with Marin Katusa (03/04/10)
TER: You mentioned a consolidation play in oil and gas, isn't that the same in the mining sector?
MK: Exactly the same. That's why for years I've been banging the drum about the Copper Mountain Mining Corporation (TSX:CUM) story. Open disclosure: I'm a director of Copper Mountain and have a lot of my personal money in it, but this company has up to a quarter billion dollars worth of infrastructure already built on OPM. That's a famous Casey line, OPM—other people's money. It's ideal to build your net worth on an already existing infrastructure. Raymond James has a 'strong buy' on Copper Mountain with a C$3.50 price target, and one of reasons why is that they've got $300 million of infrastructure sitting there already built. So, definitely, consolidation is key in mining, and also on the energy side. It's very important to know that angle when investing. With a lot of uranium mines, for example, although they have uranium, it may not work when you calculate the cost of bringing in the infrastructure.
Canaccord Capital, Morning Coffee
(02/09/10)
"Gold, Silver and Copper—forget Bronze. Copper Mountain released a project update for Copper Mountain project (75%-owned) in southeast B.C. The company indicates construction is on schedule and on budget. To date, $285 million has been spent and committed out of a planned $438 million on the project. Guidance is for construction to be completed by April 2011 and full production to be achieved by June 2011. Canaccord Adams Senior Mining Analyst Wendell Zerb is optimistic that the Similco project will meet the initial production target in H2/11. He also notes that financing risk related to Copper Mountain's Similco asset improved dramatically with the consummation of the Copper Mountain and Mitsubishi MOU (July 2009) and the $50 million equity financing closed in September 2009. As part of the Mitsubishi deal, project capital will be funded pro-rata, but Mitsubishi will be responsible for arranging C$250 million of project debt. The current mine plan is based on a conventional open-pit mine with a 35,000 tonne per day mill, producing a life-of-mine (LOM) average of approximately 83 million pounds of copper per year with gold and silver credits over an 18-year mine life. Copper Mountain is one of Wendell Zerb's top pick as he sees Similco (100%) producing at an initial annual rate of 96 million lbs Cu at C1 cash costs of approximately US$1.00/lb Cu by 2012. He feels the current market valuation discounts the future production potential of the company. Based on 3x his operating CFPS estimate (average 2011-2013), Wendell believes Copper Mountain could command a much higher valuation."
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