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Monday, February 26, 2018

Alacran - Sting of the Scorpion

PDAC season is in full flow, and lots of companies are pushing out press releases to telling us that they are great, everything is going super-well and please don't ignore us and sell our stock as we have no real news.

One of my favorite pig in lipstick press releases was from Cordoba Minerals (link), not only announcing an updated resource for Alacran, but telling us that theyz got cobalt az well, m8.

Fuk uz Forst Cobalt


We'll ignore that and look at the resources.

Original, Jan 2017 resources

hard to read, but resources calculated at $1300/oz Au and $2.50/lb Cu


New and improved resources:

@ $1400/oz Au and $3.15/lb Cu

I liked the interesting metal prices used, Cordoba was a little generous with the gold price, but why don't we do some maths and see how the project has grown with another successful year of exploration.

I mean, look at that, they increased resources by ~27%. That deserves a good hug and a nice pat on the back, we'll ignore the fact that as the tonnes have increased, those nasty little copper and gold atoms have been efficient with their New Year resolutions. Those pricks have been on a diet!


and given the deposit a stunningly unimpressive negative increase in contained metals.


  • Copper 
    • Grades dropped by 22%
    • contained metal stayed essentially the same
  • Gold
    • Grades dropped by 32%
    • contained gold dropped by 15% or 94,000 ounces
So, basically you've made Alacran worse. Well done!



8 comments:

  1. Too bad, so sad!!

    ReplyDelete
  2. I don't understand... every news release they brag about their other zones: Montiel porphyry copper-gold discovery, where drilling intersected 1.0% copper and 0.65 g/t gold over 101.1 m, and Costa Azul porphyry copper-gold discovery, where drilling intersected 0.62% copper and 0.51 g/t gold over 86.6m. WTF don't they drill these better targets???

    ReplyDelete
    Replies
    1. Small, mainly dykes, true width unknown (probably much less than drill interval)

      Delete
    2. Hello Fernando,

      The Montiel porphyry looks very small and the thick intercept appears to have been drilled down the center of a small stock/dyke.

      Delete
  3. i'm confused (normal for a 75 year old).
    taking their indicated resources for 2/3 and applying $3 and $1,250 pricing;
    taking their inferred at 50% with the same pricing, i get a gross of $1,975M.
    would a net of 5% = $98.75M / 213M shares = $.43/share(u.s) be reasonable?

    ReplyDelete
    Replies
    1. Hello,

      that is one way to calculate value for Cordoba's share price.
      The bigger picture is that with all the extra drilling done by Cordoba, they have taken a big step back with the project, which isn't good news.
      There is also concern that the geologists are Cordoba aren't sure what type of deposit they have. if it is a skarn or porphyry, it could be fine, they can be big, but if it is a massive sulfide (VMS), only the exceptional few are big enough to keep Mr. Friedland entertained.

      So, the market is punishing them for being very underwhelming

      Delete
  4. I still do not understand the subject of the PDAC season in style and many of the companies are pushing out press releases to tell us that they are good. Royal1688

    ReplyDelete
    Replies
    1. No one is going to say that their projects are crap, but basically the PDAC season is where companies either:
      1. push out a PR to tell people that they still exist
      2. save up data so that they have a 'good' PR to push out just before the PDAC to get interest
      3. wait until after the PDAC to release bad news (e.g. Pretium)

      Delete