Less than a year ago shares of Copper Fox Metals Inc. (TSX-V: CUU.VN) were trading as high as 2.30 but times have changed for the resource development company involved in the exploration and development of the Schaft Creek copper-gold-molybdenum-silver deposit located in northwest British Columbia, Canada, of which they hold 100% ownership, and those same shares are currently moving around the 1.15 level and trending down.
Of course it hasn’t been a steady decline for CUU.VN, in fact they have done an admirable job climbing back from their March swoon that dropped shares down as low as 0.97. Shares were actually as high as 1.30 last week but on Friday they have fallen as low as 1.11 and now the question is can CUU.VN find some stability.
It was on May 31, 2012 that CUU.VN hit that 1.30 mark, the same day they announced the results of their recently completed National Instrument 43-101 resource estimate for the Schaft Creek copper-gold-molybdenum-silver deposit, one of the largest deposits of its kind in North America. According to the press release the resource estimate for the Schaft Creek deposit using a 0.15% copper equivalent cut-off (Base Case) were:
a) The Measured Resource is comprised of 146.6 million tonnes grading 0.31% copper, 0.017% molybdenum, 0.24g/t gold and 1.78g/t silver (containing 1.0 billion pounds copper, 55.6 million pounds molybdenum, 1.15 million ounces gold and 8.40 million ounces silver;
b) The Indicated Resource is comprised of 1.08 billion tonnes grading 0.26% copper, 0.017% molybdenum, 0.18g/t gold and 1.68g/t silver containing 6.1 billion pounds copper, 399.7 million pounds molybdenum, 6.22 million ounces gold and 58.34 million ounces silver;
c) The combined Measured and Indicated Resource is comprised of 1.23 billion tonnes grading 0.26% copper, 0.017% molybdenum, 0.19g/t gold and 1.69g/t silver containing 7.11 billion pounds copper, 455.3 million pounds molybdenum, 7.37 million ounces gold and 66.74 million ounces silver;
d) The Inferred Resource is comprised of 597.2 million tonnes grading 0.22% copper, 0.016% molybdenum, 0.17g/t gold and 1.65g/t silver containing 2.87 billion pounds copper, 206.3 million pounds molybdenum, 3.36 million ounces gold and 31.60 million ounces silver, and;
e) The resource estimate includes the silver content of the mineralization in both the Paramount and Liard zones.
Commenting on the impact that this resource estimate will have on the company Elmer B. Stewart, President and CEO, stated, “The Measured and Inferred Resource categories, the total copper-molybdenum-gold-silver content and the fact that the deposit is still open in several directions (along strike) indicates a new dimension to the potential size of the Schaft Creek deposit. Additional drilling will have to be completed to realize this potential and define the un-explored portions of the Schaft Creek deposit. It is noteworthy that the current Measured and Indicated Resource exceeds 1.2 billion tonnes and incorporates the silver content which is expected to have a positive impact on the economics of the Schaft Creek deposit. The important criteria in selecting a cut-off grade in a resource estimate is the average grade of the metals, tonnes and contained metal content. The resource estimate shows substantial increases in both tonnes and copper-molybdenum-gold-silver content at both the 0.15% and 0.20% CuEq levels of cut-off. Given the very minimal decrease in average grade for each metal, we have been able to select a 0.15% CuEq cut-off. The Base Case results will be used to complete the Feasibility Study for the Schaft Creek project which is expected to be completed by mid to late summer 2012.”
One week earlier CUU.VN announced the completion of the planned 2012 airborne magnetic survey and the acquisition of additional mineral tenures contiguous to the Schaft Creek project. In this announcement Stewart stated “The data resulting from this survey is expected to identify exploration targets thereby allowing the Company to concentrate exploration efforts in areas with potential for porphyry style copper mineralization. The land acquisition is in line with Copper Fox’s interpretation of the porphyry copper potential along strike of the Schaft Creek deposit.”
While CUU.VN is moving forward and acquiring more land many shareholders are ready to start seeing some positive financial news. In the company’s first quarter 2012 financial results they incurred a net loss of $554,254 and incurred $3,290,267 in expenditures toward furthering the development of the Schaft Creek project. Those net losses and expenditures will likely continue to mount before they put their project into production and start generating cash flow but if they can tap into the deposits they have identified then they could quickly see their share price back where it was a year ago.
