First and Last Word on Metals and Mining

Thompson Creek Metals Company…today reported that on May 15, 2012, a wall slough occurred in the Phase 7 mining area of the Thompson Creek mine. The Company believes the slough resulted from water pressure behind the wall due to seasonal run-off. There were no injuries or equipment damage and management believes that the event will not have a material impact on the current mine plan. Management will continue to evaluate the potential impacts, if any, to the Company’s 2012 production and cost guidance for the mine.

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A Very Rough Start to 2012

May 22, 2012 at 7:00 pm
Zurbo Zurbo

Did anyone else notice Thompson Creek Metals decline from almost $10 per share in February 2012 to today’s close of $3.66? The company is now being valued at less than the acquisition price of Terrane Metals, bought way back in 2010 for its Mt. Milligan copper-gold project. Nevermind the hundreds of millions spent on Mt. Milligan since the acquisition. The trouble now is that approximately $800-$900+ million remains to be spent on the project, and after two disappointing quarters (Q4 2011 and Q1 2012) there are probably plenty of people worried about funding stresses.

Note: The recent conference call confirmed that roughly $400 million in senior notes and tangible equity units funding had closed, which should be enough to take them through production at Mt. Milligan.

2 years ago

5 Responses to Thompson Creek Metals Company Reports a Slough at its Thompson Creek MineComment RSS Feed

  1. forwill

    I noticed Zurbo. I own 400 shares at a basis of $4.67 per. Production has dropped terribly from 2011 and the big stunner was the cash flow from operations for the first quarter of 2012 was $3.1 million, compared to $76.6 million for the first quarter of 2011.
    I don’t see how this news about the slough at the Thompson Creek mine can be viewed as anything but devastatingly negative. I tried to find out where Phase 7 is in the pit to no avail. The topography at the mine is pretty darn brutal. The east wall rises approximately 2000 feet in a mere 1000 horizontal feet where the good stuff is. Uncertainty about safety could shut this sucker down for a long time.

  2. forwill

    Anyhow, they just didn’t give any detail about the slough elevation or size. If its a small volume near the top of the pit, maybe its no big deal. This statement sure doesn’t exude confidence…”"management believes that the event will not have a material impact on the current mine plan.”"

    • @forwill

      More details provided in the latest news: http://www.thompsoncreekmetals.com/s/News_Releases.asp?ReportID=534847

      Previous cash cost guidance of $7.75-$9.00/lb was not affirmed. That’s going to make for a very tough year profits-wise with molybdenum trading around $13/lb.

    • forwill

      @Zurbo

      Thanks for your thoughts.

    • Dave

      @Zurbo

      And Endako not going well, may yet sell them my mini-skeleton of LWC shares.

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