Tuesday, February 25, 2014

Rob McEwen: Presenting McEwen Mining At BMO Capital Markets MUX TNR.v GDX


  Rob McEwen gave a very interesting presentation on Gold market and his company - McEwen Mining. In the presentation on the link below you can find a lot of information about the company. Despite the very impressive run recently of more than 100% from the December low to the recent highs McEwen mining is covered by only one analyst.
  Further catalyst will come with the expansion of El Gallo 1 mine and development of El Gallo 2 mine, ongoing exploration and development in Nevada and changing situation in Argentina. In order to put El Gallo 2 into production Rob waits for the better Silver prices: "... at 25 dollars it is the very attractive asset." With the better market and metal prices company can revisit the idea of financing for this project in the market.
  Situation in Argentina is changing for the better with recent developments on Repsol compensation. Goldcorp was talking about "Argentina issues easing" and Pan American Silver CEO has recently sated:

"Meanwhile, when asked by an analyst to comment on the future of the Navidad project, PanAm CEO Geoff Burns said he sees signs of noted improvement “in our operating environment and in the attractiveness of making investments” in Argentina.
“There was a new chief of cabinet installed…now a couple of months ago,” he observed. “And he certainly seems to be driving a more business-friendly environment, or at least, pushing for a more business-friendly environment.”
“I was down there [in Argentina] just a couple of weeks ago, and I would say I am more optimistic than I have been in the last couple of years about the future of Argentina and the future of mining investment in Argentina,” Burns advised."

  Rob has mentioned as well that Argentina is changing for the better now: "Profits are coming out of the country now and political change will happen within next one and a half years. We have very large Los Azules Copper project in Argentina. Last year large projects went out of favour, we are sitting on it now. Copper prices are above 3 dollars now and we had the new PEA last Fall. It is our source of liquidity in the future."
  TNR Gold is still the sleeping beauty: company holds shares in McEwen Mining after the settlement on Los Azules and Back-In right into Los Azules Copper project in Argentina. Among other assets TNR Gold holds 100% of Shotgun Gold project in Alaska with first resources announced last year and strategic stake in International Lithium.
  You can find the information about the webcast on the company website and the presentation on the link below.

Goldcorp: Argentina Issues Easing, Cerro Negro On Track For Mid-2014 Production GG MUX TNR.v ILC.v LCC.v

"Argentina is slowly coming to its senses with its relationship with the mining industry. The most important is not what we can read in the government proclamations, but the real progress on the ground. Goldcorp reports about its progress with Cerro Negro Gold-Silver mine in Argentina and that operating in the country is getting easier. FT reports that "Repsoil poised to sign $5bn compensation deal with Argentina." "...the settlement is also likely to provide a boost to Argentina, which is trying to rebuild its credibility with international investors ..."
  Companies on our watch list should enjoy the better valuations with the improved investment climate in Argentina. McEwen Mining has exploration properties in the area of Goldcorp's Cerro Negro Gold-Silver mine, operating J/V on the San Jose mine with Hochschild Mining in Santa Cruz and world class  Los Azules Copper project in San JuanTNR Gold is involved with McEwen mining in Los Azules copper project with its back-in right and holds shares of McEwen mining. International Lithium is working on Mariana Lithium brine project in Salta with Ganfeng Lithium strategic partner from China. Lumina Copper is looking for a buyer on its Taca Taca copper project in Salta as well."

Copper M&A Heating Up: OZ Minerals Gets Approaches on $2.7 Bln Copper Project MUX TNR.v CU GDX

 "Copper M&A is heating up and now Australia's largest unmined copper deposit is in play. Rob McEwen should be using this momentum now in the market place and put Los Azules copper deposit on the industry radar screens. TNR Gold and McEwen Mining will be very well positioned for this upturn in the market place. CRB index is breaking out and increasing M&A activity is signalling that the bottom is in place for the resource sector.  Meanwhile McEwen Mining has breaking out to the upside above CAD3.0 with Gold in a breakout mode."

Copper M&A: HudBay Eyes Arizona Copper Deposit With Augusta Offer TNR.v, MUX, HBM, AZC, LCC.v

 "Copper M&A is heating up and following Chinese quest for the long term secured supply of Copper Hudbay is bidding for one of the most promising Copper projects in the U.S. Increasing M&A activity confirms that the bottom for the mining stocks is in and industry insiders are looking for the best assets before the general public will drive the prices up.
  Glencore is talking about the higher Copper prices to come and they are not alone in this industry observation. McEwen Mining and TNR Gold will get now more attention to Los Azules copper project, as we have discussed yesterday, and Lumina Copper will be in M&A play as well with its Taca Taca copper deposit in Argentina."

Copper M&A: Glencore Plays Deal Or No Deal With China On Prize Copper Asset MUX, TNR.v, CU, GDX

"FT reports about very interesting developments around the Las Bambas Copper mine in Peru. To sell this prize copper asset was always the condition for Chinese approval of Xstrata and Glencore merger. Chinese are ready to put their hands on it, but now, apparently, Glencore is talking about higher Copper prices and better economics of the project, which can affect the sale.

  All this new information bodies very well for McEwen Mining and TNR Gold with their Los Azules Copper project in Argentina. Actually Xstrata was involved in that project as well. Timing of the deal on Las Bambas is very important  - before it was scheduled for September and now talks could be concluded this month. Copper market M&A is heating up and the major players are ready to make their bets already."

TNR Gold TNR.V is one of the most intriguing microcap stories I follow. cc:

Los Azules Copper - McEwen Mining And TNR Gold: Yamana Gold to invest $450 million in Argentine mine MUX, TNR.v, LCC.v

"It looks like the shift in Argentina for the better is happening for real this time. Rob McEwen has discussed it in his recent presentation and that in his opinion "we have seen the low in Argentina after  a lot of disappointment". Shevron special Shale Oil deal, repayment to Repsol and now Yamana Gold investment are certainly the things we would like to see now after elections. Lumina copper is holding above CAD5.00 these days and McEwen Mining and TNR Gold should benefit from Los Azules copper revised valuation now."

Copper M&A: Peru Officials Meeting Chinalco, Minmetals This Week on Las Bambas Bids MUX, TNR.v, LCC.v, CU, GDX

 "With Chinese economy in the recovery mode quest by Chinese companies for the best mining assets is ongoing worldwide. Lumina Copper is getting some bids today again and Los Azules copper will be getting on the investors' radar screens with the changing political landscape in Argentina again."

"Los Azules Copper ProjectArgentina (100%)

In September, McEwen Mining announced an updated PEA for the Los Azules Copper project. The results from the PEA demonstrate that Los Azules has the potential to become one of the largest, lowest cost copper mines in the world. In addition, there remains excellent exploration potential to further expand the size of the existing mineral resource. Highlights from the PEA are shown below:
  • Pre-tax Net Present Value of $3.0 billion (8% discount rate) and an Internal Rate of Return of 17.7%.
  • Annual copper production during years 1-5 to average 258,000 tonnes (568 million lbs), which would have placed it in the top 3%1 of copper mines in the world during 2012. Life of mine annual copper production to average 171,000 tonnes (377 million lbs) over 35 years.
  • Indicated resource of 5.4 billion pounds of copper (grading 0.63% Cu) and 0.8 million ounces of gold (389 million tonnes with a cut-off grade of 0.35% Cu) and Inferred resource of 14.3 billion pounds of copper (grading 0.46%) and 2.6 million ounces of gold (1,397 million tonnes with a cut-off grade of 0.35% Cu).
  • Initial capital costs to construct the mine and process plant have been estimated at $3.9 billionwith a payback on a pre-tax basis has been estimated at 3.8 years at $3.00/lb copper and$1,300/oz gold.
1 Based on internal market data.
The PEA is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the PEA will be realized.
The PEA has been filed under the Company's profile on SEDAR (www.sedar.com) pursuant to the requirements of Canadian National Instrument 43-101 and is also available on the Company's website - www.mcewenmining.com."
All slides are from McEwen Mining presentations.

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