Custom Studies
We offer a custom study service to our “Full Service” customers per paragraph #12 of our standard customer agreement at JTVIR Services Page. Mr. Tumazos is available for a few custom studies each year so we do not accept all requests, but will handle them wherever possible.
In the cases of each of the three custom studies we delivered in 2008, a large U.S. hedge fund commissioned us to deliver a detailed report on a company for which no U.S. investment research was available. These are examples of work we have done, but we are flexible and willing to consider projects outside of nickel, copper, molybdenum and iron ore as well.
Completed Studies
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Skye Resources. An 18% shareholder and outside director commissioned us to evaluate this nickel mine restart in Guatemala, which HudBay Minerals subsequently acquired. We accepted the project because Inco had produced 33 mm lbs of nickel there after building a $238 mm plant in 1977, Vale and BHP Billiton each owned about 10% and it clearly was a venerable deposit. We estimated it contained 11 billion pounds of nickel plus amounts of cobalt in ores ranging from 10% to 50% iron content.
Our task included traveling to the mine site in the eastern lowlands of Guatemala, evaluating the regional geology for exploration upsides, reviewing the 2007 Hatch Engineering detailed feasibility study, financial simulations and valuations. The “plant” resembled an electric arc furnace steel melt shop such as Nucor would operate with simple mining, crushing and ore drying preceding the melting furnace. We delivered a 37 page report in January 2008, which we published and is attached to our “past research” tab. Skye spoke at our 3-27-08 first investor conference.
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Mercator Minerals. A 7% shareholder commissioned us to evaluate this copper-moly restart in Arizona. Mercator’s October 2007 bid for Tyler Resources created some concern. Mercator Minerals’ Mineral Park, AZ deposit is a historic copper-molybdenum-silver deposit already had produced 761 mm lbs of copper, 50 mm lbs of moly and 5 mm oz of silver in the past. The resource enjoys past drilling data from Duval, Cyprus Amax Minerals, Equatorial Minerals and others.
Our task included traveling to the mine site in northwest Arizona, viewing construction, reviewing the 12-29-06 prefeasibility study, financial simulations and valuations. We later initiated research coverage in May 2008. Mercator Minerals spoke at our 3-27-08 and 11-12-08 investor conferences.
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Minera Sante Fe 70% owned by JSW Steel Ltd. A shareholder commissioned us to evaluate a particular project within the third largest steelmaker in India, without our undertaking a full study of the publicly traded parent. Coincidentally we had another business trip scheduled to Chile in April 2008 and were able to visit the sites near Copiapo in the 3rd Region of Chile with just one incremental business day including travel. We evaluated it in the context of iron ore market conditions in April 2008.
JSW Steel Ltd’s Minera Santa Fe 70%-owned venture included a deposit called Bellavista, an undrilled southerly deposit called Vinita and satellite regional magnetic anomalies not yet acquired. The mineral occurred as magnetite amenable to simple portable crusher and grinding, similar to road side machines suitable to build an expressway ramp. Magnetic separation was able to upgrade ores as lean as 20% fee to a deliverable product nearer 60% fe. Two of three zones of the Bellavista deposit to the north of Copiapo already had been drilled, and preparation of a 43-101 compliant resource had been begun. Studies of improvements to road, rail and port to support tenfold volume increases were underway.
The Vinita zone 20 km to the south of Copiapo consisted of a 12 km by 4 km ridge nearly 1 km deep that was one huge magnetic anomaly. Visible malachite, turquoise, calcocite and chalcopyrite copper ores were visible on much of the property. Small commercial copper, gold and silver producing mines were active on the site. It appeared to be one of the more significant IOCG (iron oxide copper-gold) deposits in Latin America.