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Message: Excelsior about to reach the 2nd and 3rd Milestone
Excelsior about to reach the 2nd and 3rd Milestone
On August 8, we reported on Excelsior Mining Corp. (TSX-Symbol: MIN) respectively that the company has reached successfully the 1st milestone to bring its Gunnison copper deposit in Arizona (USA) into production with the cost-effective and quickly constructible ISR mining method.
Technically, the stock consolidated sideways within the red-blue triangle after the strong increase from approx. $0.33 to $.80 in late 2010 / early 2011. In June 2011, the so-called breakout above the red triangle-leg at approx. $0.53 was accomplished, whereafter a so-called „classical pullback“ to the apex of the triangle at approx. $0.43 occurred.
Since then, the share-price attempts to thrust to the upside, whereas the price consolidates beneath the red parallel-resistance – hence, the thrust to the upside is set to start once this resistance (currently at $0.50) has been broken acting supportive (buy-signal à la thrust to the upside). A sell-signal à la thrust to the downside is generated not until breaching the lowest blue support (currently at $0.40).
On August 8, we reported on Excelsior Mining Corp. (TSX-Symbol: MIN) respectively that the company has reached successfully the 1st milestone to bring its Gunnison copper deposit in Arizona (USA) into production with the cost-effective and quickly constructible ISR mining method.
In order to do so, it was first necessary to upgrade the „inferred“-resource (2.9 billion pound copper-oxides) into the „measured & indicated“-category.
In early August, Excelsior announced that the new „measured & indicated“-resource now stands at 3.2 billion pound copper-oxides, whereas another 0.9 billion pound remain in the „inferred“-category (as well at a cut-off-grade of 0.1% Cu).
In early August, Excelsior announced that the new „measured & indicated“-resource now stands at 3.2 billion pound copper-oxides, whereas another 0.9 billion pound remain in the „inferred“-category (as well at a cut-off-grade of 0.1% Cu).
Yesterday, Excelsior announced the completion of the hydrological (2nd milestone) and the metallurgical (3rd milestone) tests and that the results will be compiled, interpreted and published during the next weeks. The management is confident to release the results in September. We anticipate that the hydrological study will have a positive result – as initial hydrological tests were already conducted in the past by which management ultimately recognized the potential of the Gunnison deposit. We even think that the hydrological setting and conditions will be even more advantageous as at the Florence deposit. In case of a “positive” hydrological study, the share-price shall appreciate strongly as the highest hurdle towards production will be overjumped successfully. Management also expects to release the metallurgical results in September which study was commenced in February, whereas initial studies in the past also already indicated that the rock is favorable for ISR.
After receipt of both studies, these will be summarized and interpreted in terms of mineability by an independent company resulting in a PEA-report („Preliminary Economic Assessment“). Should the PEA have a „positive“ result (depending mainly on the results of the hydrological and metallurgical studies), it has become probable that Gunnison can be brought in production.
Already now we anticipate that the PEA will have a positive result and that Gunnison will be brought into production in the near future.
The ISR mining method has been already used in Arizona numerous times successfully to mine-out copper-oxide deposits cheaply and environmentally-friendly, such as for example the productive San Manuel Mine (approx. 110 km north-west of Gunnison). Besides Gunnison, the Florence copper-oxide deposit from Curis Resources (a Hunter Dickenson company) is currently being developed towards ISR production, whereas a positive PEA (“Preliminary Economic Assessment”) was already received (capital costs: $240 million; operating costs: $0.68/lb Cu; after-tax NPV: $550 million; copper price: $3/lb; discount rate: 7.5%; output: 77 million lb. Cu per year; life of mine: 19 years). Curis plans the commencement of production in the 3rd quarter 2011.
Since the Gunnison deposit has virtually the same size, grades and as well strongly fractured ore, we anticipate that Gunnison will soon also be classified as “mineable”, especially against the background that the geologic setting of Gunnison seems to be even more favorable for the ISR mining as the Florence deposit.
Technically, the stock consolidated sideways within the red-blue triangle after the strong increase from approx. $0.33 to $.80 in late 2010 / early 2011. In June 2011, the so-called breakout above the red triangle-leg at approx. $0.53 was accomplished, whereafter a so-called „classical pullback“ to the apex of the triangle at approx. $0.43 occurred. Since then, the share-price attempts to thrust to the upside, whereas the price consolidates beneath the red parallel-resistance – hence, the thrust to the upside is set to start once this resistance (currently at $0.50) has been broken acting supportive (buy-signal à la thrust to the upside). A sell-signal à la thrust to the downside is generated not until breaching the lowest blue support (currently at $0.40).
At the bottom of the chart is the share-price of Excelsior relative to the HUI-index, whereas it trends downwards since the beginning of 2011 (meaning that the HUI performs better than Excelsior). As soon as the red resistance is broken, we anticipate the beginning of a new upward-trend (meaning that Excelsior will perform better than the HUI).
The MACD-indicator recently fell to the green support, whereas the black curve may rise above the red curve any time now which would result in a distinct buy-signal enforcing itself once rising above the 0-level.
In the research-section of www.rockstone-research.com one can download our previous articles on Excelsior Mining Corp. and other companies as well. With the free and non-binding Newsletter, Rockstone can notify you immediately once new publications have been released.
DISCLAIMER: All analysts, industry-experts or other authors under the roof & label of Rockstone Research Ltd. or Makrocheck conduct their work on their own responsibility & costs respectively without any kind of remuneration from Rockstone or Makrocheck . The companies that are analyzed or mentioned under the roof & label of Rockstone Research Ltd. or Makrocheck did NOT pay any kind of remuneration to Rockstone, Makrocheck or the respective author. At the time of publication, the respective author or any person affiliated with Rockstone or Makrocheck does NOT hold any stock or other kinds of securities or interests of Excelsior Mining Corp. All information that is provided here solely represents the opinion, thoughts & intuitions of the author & do NOT reflect an advise or any kind of consultation to the reader. The provided analysis of especially markets & companies are solely for the purpose of information & education in no way it is to be construed as a de facto buy-, hold- or sell-recommendation for any kinds of securities, physical goods or markets; hence the provided content does NOT represent an act of consultancy, advise or an offer to buy, hold or sell anything. Please read the full disclaimer at www.rockstone-research.com
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