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Companies in bidding war over copper

By Daniel McGroarty | Posted: April 27, 2011 at 2:59 pm

As Reuters reports, indications are that Americans could soon be buying Zambian or Saudi Arabian copper from Canada and China. Canada’s Barrick, the world’s largest gold mining company, is attempting to win a geopolitical bidding war with its Chinese competitor Minmetal in the effort to gain control over two valuable copper mines in Zambia and Saudi Arabia owned by Equinox.

The takeover offer comes at a time when the commodity’s prices have hit an all-time high. With the global race for scarce resources heating up, the reality is that in a world where commodities are trading at ever-new highs, today’s prices may well be cheap in tomorrow’s world.

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  • siegfried

    There are close to 80 billion pounds of copper and counting at the Pebble deposit in southwestern Alaska.If in production,it will generate up to 25% of American domestic use annually for one hundred years and beyond.The NGOs are all over this spreading false informations and  fear based propaganda.One wind turbine uses up to 4 tons of copper.I bet the tree huggers do not use computers at all or have any desire to recycle their cars for the energy efficient ones which takes twice the amounts of coppers to produce.

  • Greg W

    No need to look beyond Copper Fox’s Schaft Creek. The BFS will be out before March 4 for the PDAC convention. That starts the 120 day clock ticking where Teck has to make its election for the option.

    Teck Option Agreement:
    Teck may at any time elect to exercise the earn-back terms and conditions of the Option Agreement.

    On receipt of a Positive Bankable Feasibility Study, a defined term in the Option Agreement, Teck has 120 days in which to elect to either: i) exercise one of its earn-back options, or ii) retain a 1% net smelter return royalty, or iii) receive common shares of Copper Fox to a value of $1,000,000.

    If Teck elects to exercise its earn-back option pursuant to the Option Agreement, then Teck has the right to elect to acquire either a 20%, a 40% or a 75% working interest in the Schaft Creek Project from Copper Fox by solely funding subsequent expenditures equal to either 100%, 300% or 400% of Copper Fox’s prior expenditures pursuant to the Option Agreement. In the event Teck elects to earn-back a 75% working interest in the Schaft Creek Project, Teck will be responsible for arranging Copper Fox’s share of project financing and will recover the project financing funds from Copper Fox’s share of metal sales until payout is reached.

    An example of how the Teck earn-back option works based on the assumption that Teck elects to exercise either 20%, 40% or 75% earn-back is set out below. This example assumes that Copper Fox has incurred a total of $75.0 million of qualifying expenditures pursuant to the Option Agreement at the time Teck makes its election.

    We all hope they take the smallest position in our $127 billion deposit. Of course they will take the 75% and have to build the mine. This will trigger bids for our share. A number of suitors have made themselves known.

    All the finance for the buyer is already in place. The port facilities have been paid for and final permits have been applied for.

    We expect the price to start rising in the next 2 weeks. Don’t be surprised if the price goes up right after the Vancouver show. People who’ve been trading this for the last year know the timing. About 60% of the shares are held tight so the float is thin. The sp is capable of rising within 48 hrs once a buyer tries to take a larger position. Stifel drove the price to $2.76 just with their buys.

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