Read on Twitter
Thread on #PXC and the (in my view) asymmetric risk/return proposition it entails.
Full credit for this goes to Jeffrey Temple (a retired chartered engineer) who produced a fantastic write up. Anything in quotes are directly his words.
Full credit for this goes to Jeffrey Temple (a retired chartered engineer) who produced a fantastic write up. Anything in quotes are directly his words.
1/
Phoenix is a miner operating in Idaho, which is an extremely favourable jurisdiction. Why?
geopolitically stable
low tax (corporate tax rate of 7.4%)
traditionally more accepting of miners owing to its political makeup
This contrasts with most EM-focused miners.
Phoenix is a miner operating in Idaho, which is an extremely favourable jurisdiction. Why?
geopolitically stablelow tax (corporate tax rate of 7.4%)traditionally more accepting of miners owing to its political makeupThis contrasts with most EM-focused miners.
2/
PXC recently carried out a large placing - they are fully funded for the current business plan.
Canaccord Genuity now own approximately 5%, as do the Board of Directors. Among others, these names make the shareholder register v. impressive.
PXC recently carried out a large placing - they are fully funded for the current business plan.
Canaccord Genuity now own approximately 5%, as do the Board of Directors. Among others, these names make the shareholder register v. impressive.
3/
One of the reasons dilution risk is limited is because 'they plan to use the cash thrown off to fund the other projects, including the deep sulphide mines where the real bounty is expected to be found.'
Phoenix plan to diversify across gold, silver, lead, copper etc.
One of the reasons dilution risk is limited is because 'they plan to use the cash thrown off to fund the other projects, including the deep sulphide mines where the real bounty is expected to be found.'
Phoenix plan to diversify across gold, silver, lead, copper etc.
4/
Now, onto their 'range of polymetallic deposits'.
Now, onto their 'range of polymetallic deposits'.
5/
Empire Open Pit.
'The value of metal in the ground at the Empire open pit alone, as a confirmed measured and indicated resource, is approaching $2 billion.'
Empire Open Pit.'The value of metal in the ground at the Empire open pit alone, as a confirmed measured and indicated resource, is approaching $2 billion.'
6/
'Last year’s summer drilling programme in Empire delivered the first gold to be produced in 80 years, in a laboratory sample. '
'The economic model presented on 16th Feb 2021 is presently showing a cash pay-back of well under a year.'
In other words ~100% FCF yield in '23.
'Last year’s summer drilling programme in Empire delivered the first gold to be produced in 80 years, in a laboratory sample. '
'The economic model presented on 16th Feb 2021 is presently showing a cash pay-back of well under a year.'
In other words ~100% FCF yield in '23.
7/
Phoenix plan to be a 'producer of copper, gold, silver and zinc by end 2022' through Empire.
It is now passing through an environmental permit process, which is expected to be favourable given its jurisdiction.
Phoenix plan to be a 'producer of copper, gold, silver and zinc by end 2022' through Empire.
It is now passing through an environmental permit process, which is expected to be favourable given its jurisdiction.
8/
Red Star.
'The high grade silver/lead mine at Red Star is next in the company’s sights.'
'Hardman estimate on page 22 of their 29 March 2021 Research document that a combined Empire Open pit, together with Red Star, could be worth a share price of 162p.
Red Star.'The high grade silver/lead mine at Red Star is next in the company’s sights.'
'Hardman estimate on page 22 of their 29 March 2021 Research document that a combined Empire Open pit, together with Red Star, could be worth a share price of 162p.
9/
More drilling is planned for summer 2021. It is thought that there are now multiple veins, and that the strike could continue for several kilometres.'
More drilling is planned for summer 2021. It is thought that there are now multiple veins, and that the strike could continue for several kilometres.'
10/
Navarre Creek.
'A Carlin style gold strike located 5km from Empire.' Potentially v. large.
'Results from surface sampling confirmed presence of volcanic hosted, Carlin-type mineralisation along selected sections of the strike length.'
Drilling planned in summer '21.
Navarre Creek.'A Carlin style gold strike located 5km from Empire.' Potentially v. large.
'Results from surface sampling confirmed presence of volcanic hosted, Carlin-type mineralisation along selected sections of the strike length.'
Drilling planned in summer '21.
11/
Whiteknob.
'According to Nigel Maund, their consultant geologist:
Whiteknob.'According to Nigel Maund, their consultant geologist:
12/
“The foregoing reinforces the view, held in the writer’s previous report on the Empire Mine Project for PXC of last April 2019, that the potential mineralised system has been less than 1% exploited and explored.
“The foregoing reinforces the view, held in the writer’s previous report on the Empire Mine Project for PXC of last April 2019, that the potential mineralised system has been less than 1% exploited and explored.
13/
Indeed, for all intents and purposes, this northern part of the system remains unexplored with indications of substantial ore potential within medium to high grade polymetallic base & precious metal systems offering significant collective potential tonnage.”'
Indeed, for all intents and purposes, this northern part of the system remains unexplored with indications of substantial ore potential within medium to high grade polymetallic base & precious metal systems offering significant collective potential tonnage.”'
14/
Redcastle and Bighorn.
'The Cobalt Resources in the Idaho Cobalt Belt located in the most prolific trend of cobalt mineralisation in the country. All samples taken in a surface sampling programme encountered cobalt mineralisation.'
Redcastle and Bighorn.'The Cobalt Resources in the Idaho Cobalt Belt located in the most prolific trend of cobalt mineralisation in the country. All samples taken in a surface sampling programme encountered cobalt mineralisation.'
15/
The Deep Sulphides - the big one.
'A Geological Survey from the United States Department of the Interior, dated October 1944, shows on page 11 that in 1942, a load of the last ore to come out of Phoenix had a WO3 grade of 4.28%.
The Deep Sulphides - the big one.'A Geological Survey from the United States Department of the Interior, dated October 1944, shows on page 11 that in 1942, a load of the last ore to come out of Phoenix had a WO3 grade of 4.28%.
16/
'For reference, Tungsten is today approx. $30/kg, and copper £9/kg.
From the document: '“The geological studies indicate that the possibilities of finding additional ore bodies at the Empire mine are very good”.
'For reference, Tungsten is today approx. $30/kg, and copper £9/kg.
From the document: '“The geological studies indicate that the possibilities of finding additional ore bodies at the Empire mine are very good”.
17/
'The report also indicated that they had a cut-off for copper of 2%, an indication of the wealth which awaits.'
'The report also indicated that they had a cut-off for copper of 2%, an indication of the wealth which awaits.'
18/
'Our (PXC's) geologists are now saying that Empire resembles Antamina – in the Andes, which is one of the world’s largest copper-zinc mines.
'Our (PXC's) geologists are now saying that Empire resembles Antamina – in the Andes, which is one of the world’s largest copper-zinc mines.
19/
It is worth adding another quote from Hardman “The world’s largest molybdenum mines are located on porphyry molybdenum systems, and most of the world’s largest copper mines are copper-porphyry deposits – generally high-volume/low-grade in nature.
It is worth adding another quote from Hardman “The world’s largest molybdenum mines are located on porphyry molybdenum systems, and most of the world’s largest copper mines are copper-porphyry deposits – generally high-volume/low-grade in nature.
20/
While the major products from porphyry copper deposits are copper-gold and copper-molybdenum, they are often important sources of zinc, lead, silver and tungsten.”
While the major products from porphyry copper deposits are copper-gold and copper-molybdenum, they are often important sources of zinc, lead, silver and tungsten.”
21/
Nigel Maund, PXC’s consultant geologist, believes that The Empire Mine is sat on a copper-tungsten-molybdenum porphyry. In his last visit on site in 2019 he wrote that he was convinced that we have a larger mineralised system underneath the Empire Mine.
Nigel Maund, PXC’s consultant geologist, believes that The Empire Mine is sat on a copper-tungsten-molybdenum porphyry. In his last visit on site in 2019 he wrote that he was convinced that we have a larger mineralised system underneath the Empire Mine.
22/
In Maund’s view, Empire is most likely a porphyry molybdenum-tungsten system.
We now believe that when the last shipments were coming out of the Empire mine before they closed it, they were heading down towards the Tungsten zone.
In Maund’s view, Empire is most likely a porphyry molybdenum-tungsten system.
We now believe that when the last shipments were coming out of the Empire mine before they closed it, they were heading down towards the Tungsten zone.
23/
Further work this summer will start to confirm the extent of the copper-tungsten-molybdenum porphyry resources at depth.'
Further work this summer will start to confirm the extent of the copper-tungsten-molybdenum porphyry resources at depth.'
24/
To conclude, #PXC is diversified across metals, mines and fully funded for the current plan in a safe jurisdiction.
It is expected to return more than the entire market cap in cash, from ONE location in coming years. Optionality upside is significant, as shown above.
To conclude, #PXC is diversified across metals, mines and fully funded for the current plan in a safe jurisdiction.
It is expected to return more than the entire market cap in cash, from ONE location in coming years. Optionality upside is significant, as shown above.
25/
Again, full credit to Jeffrey Temple for this. It is the research of PIs like him that makes share chat worth having.
I personally am still new to mining so trying to surmount the steep learning curve!
Interested to hear thoughts.
Again, full credit to Jeffrey Temple for this. It is the research of PIs like him that makes share chat worth having.
I personally am still new to mining so trying to surmount the steep learning curve!
Interested to hear thoughts.
