ECR Minerals (formerly Electrum Resources) plc is a diversified mining investment company with quality assets and the capability to undertake significant, value accretive transactions. ECR Minerals is dedicated to creating value for its shareholders through a process of finding value, adding value and realising value. In order to achieve this, Electrum Resources is able to access a pipeline of projects sourced from its global network and utilises the expertise of its directors and advisers.
ECR Minerals holds interests in the USA, Argentina, Indonesia, Thailand and Australia.
Mercator Gold to sell exclusive Copper Flat option to Canada's THEMAC Resources
Mercator Gold (AIM: MCR) has entered into a binding heads of agreement with THEMAC Resources Group (TSX-V: MAC.H) to sell its entire interest in New Mexico Copper Company Inc (NMCC), whose main asset is an exclusive option over the Copper Flat copper-gold-molybdenum-silver project in New Mexico.
Mercator will receive 10.5 million fully paid shares in THEMAC and 10.5 five-year warrants exercisable at C$0.28 per share. THEMAC will also fund all expenditure by Mercator or NMCC over the Copper Flat project from the date of the agreement until the completion of the transaction and place 5.5 million shares at C$0.15 per share with attached one-year warrants exercisable at C$0.28 per share. A second placing of shares to raise C$5 million with one year warrants at a price sufficient to raise C$10 million will be undertaken prior to the completion of the transaction.
The closing price of shares in THEMAC Resources on 12 March 2010 was C$0.24 with 12.6 million shares in issue.
“The Copper Flat project is an exceptionally promising asset in the present copper market, and vending NMCC and its exclusive option over the project into a dedicated North American listed company with highly capable and experienced management will ensure that the project becomes well placed to obtain the funding required for the timely recommencement of production,” said managing Director of Mercator Gold Patrick Harford.
Mercator noted that it is no longer responsible for the purchase and development costs of Copper Flat, while retaining substantial interest in the project. The company said its interest in THEMAC could generate “extraordinary” returns.
Copper Flat is a former producing mine with substantial infrastructure still in place. The Copper Flat deposit has historic reserves of 50.21 million short tons at an average grade of 0.45% Cu (copper), 0.1244 g/t Au (gold), 2.053 g/t Ag (silver) and 0.015% Mo (molybdenum), based on a cut-off grade of 0.23% Cu.
On the basis of current historic reserves and assuming metal prices of US$3/lb copper, US$10/lb molybdenum, US$900/oz gold and US$13/oz silver, the Copper Flat project is estimated to have an NPV (net present value) of US$348 million and an IRR (internal rate of return) of 45%, assuming initial capital costs of US$115 million for the recommencement of production and a discount rate of 8%. The current price of copper is US$3.33/lb.
