|
Cerro Resources NL (CJO-V)
Cerro Resources is an Australian company that listed on the TSXV as King Minerals in September 2010 before changing its name. The company several early-stage projects in Australia, as well the Cerro de Gallo gold-silver-copper project in Guanajuato Mexico that was previously held by San Anton Minerals. In December 2012 the company announced it had agreed to be acquired by Primero Mining on the basis of 0.023 of a Primero common share for each Cerro common share held, roughly a $120 million transaction. Additionally Cerro shareholders will receive 80.01 per cent of the common shares of a newly incorporated company (Spinco). Spinco will assume Cerro's interests in the Namiquipa, Espiritu Santo, Mt. Philp and Kalman projects, shares in Syndicated Metals Ltd., and approximately $4-million in cash. |
Key to Understanding IPV Charts and Spec Value Hunter Tables
An IPV Chart is a graphical presentation of a Spec Value Hunter table that has been constructed according to the Rational Speculation Model developed by John Kaiser. The IPV Chart allows speculators to identify which projects offer poor, fair or good speculative value in both absolute and relative terms. The speculative value depends on the project stage, the project's implied value as calculated by the company's fully diluted capitalization, stock price and net project interest, and the dream target deemed appropriate for the project. A dream target is what a project would be worth in discounted cash flow terms once in production. |
Green background indicates the dream target judged appropriate for this play by John Kaiser - otherwise unranked. |
Poor Speculative Value - |
Fair Speculative Value - |
Good Speculative Value - |
Note: narrow arrows indicate IPV is outside the fair value channel but within 25% of the fair value limits |
Click on the company name to view the company profile, the project name to view project details. |
Click on the project icon if its background is shaded to get the IPV Chart for that company. |
Cerro Res Project Valuations
Company | Project | Country | Stage | IPV $ MM | $100 | UPV $500 | $2000 | Target Metals | Deposit Style |
Key Company Projects |
|
Cerro Resources NL (CJO-V) | Cerro de Gallo | | Mexico | Permitting & Feasibility |
$147 | | |
| Gold Silver Copper | Porphyry |
|
|
Peer Projects |
|
|
|
|
|
|
Comparable Projects |
|
|
|
|
Success Stories |
|
|
|
Cerro de Gallo | | 66% WI | Mexico | 7-Permitting & Feasibility |
---|
Cerro del Gallo - stage I 43-101 Economic Study (USD except where noted otherwise) |
BFS | May 11, 2012 |
| | Cerro del Gallo - stage I |
Mining Scenario | TR | Mining Costs |
Mining Type: | OP |
| Cost Currency: | USD |
Processing Type: | HL |
| Capital Cost: | $154,200,000 |
Operating Rate: | 12,500 tpd |
| Sustaining Cost: | $28,933,000 |
Operating Days: | 365 |
| Operating Cost: | $10.89/t |
Strip Rate: | 0.9 |
| BC Cash Cost per Unit: USD | $732/oz Au |
Mine Life: | 7 years |
| BC Cash Cost Net By-Products: USD | $204/oz Au |
LOM Tonnage: | 32,219,000 t |
| BC All-In Cost Net By-Prod: USD | $580/oz Au |
Est Startup: |
|
| Spot All-In Cost Net By-Prod: USD | $735/oz Au |
Production Potential |
| Metal 1 | Metal 2 | Metal 3 | Metal 4 |
Metal: | Au | Ag | Cu |
|
Grade: | 0.69 g/t | 14.82 g/t | 0.08% |
|
Recovery: | 68.5% | 50.1% | 31.8% |
|
Annual Output: | 67,900 oz | 1,072,000 oz | 2,454,165 lb |
|
LOM Output: | 487,500 oz | 7,697,000 oz | 17,617,950 lb |
|
Base Case Price: | $1,341/oz | $25.58/oz | $3.43/lb |
|
Spot Price: | $1,315/oz | $16.47/oz | $3.10/lb |
|
Base Case NSR: | $19.96/t | $6.01/t | $1.84/t |
|
Spot NSR: | $19.57/t | $3.87/t | $1.67/t |
|
Base Case Valuation |
Reported Valuation Currency: | USD |
| Pre-Tax NPV: | $181,000,000 |
Discount Rate: | 6% |
| After-Tax NPV: |
|
Total Base Case NSR USD: | $27.81/t |
| Pre-Tax IRR: | 31% |
Total Spot NSR USD: | $25.11/t |
| After-Tax IRR: |
|
Annual Pre-Tax Cash Flow Base Case and Net CF/FDSH USD: | $77,207,821 | $0.06 | Pre-Tax Payback: | 2.7 y |
Annual Pre-Tax Cash Flow Spot and Net CF/FDSH USD: | $64,870,022 | $0.05 | After-Tax Payback: |
|
Enterprise Value CAD : | $144,809,285 | $.19/sh | Share Price: | $0.13 |
Note: |
Comparative Valuations using Life of Mine Averages |
Discount Rate: | 0% | 5% | 10% | 15% |
Base Case Pre-Tax NPV USD: | $357,321,747 | $255,844,330 | $183,234,039 | $130,278,903 |
Base Case Pre-Tax Net NPV/Sh USD: | $0.31 | $0.23 | $0.16 | $0.11 |
Premium BC PT NPV over EV: | $0.16 | $0.08 | $0.01 | ($0.04) |
Spot Pre-Tax NPV USD: | $270,957,151 | $187,852,793 | $128,628,970 | $85,643,751 |
Spot Pre-Tax Net NPV/Sh: | $0.24 | $0.17 | $0.11 | $0.08 |
Premium Spot PT NPV over EV USD: | $0.09 | $0.02 | ($0.04) | ($0.07) |
The comparative NPV calculations assume constant annual cash flow based on the life of mine average annual payable production and CapEx spent in year one. The operating cost includes the LOM sustaining capital. Due to details such as ore scheduling these NPV figures may differ from those of the 43-101 economic study. |
After-Tax Valuations using Spot By-Product Prices |
|
|
|