Friday, 24 October 2014

Copper M&A: China's Strategic Stockpiling Sways Global Copper Market.

Los Azules Copper M&A: Copper Climbs as Chinese Manufacturing Signals Growth.

  "Higher Copper prices will drive the valuation of our Royalty on Los Azules Copper and will put this very important project to the forefront of M&A activity in Latin America. 
  McEwen Mining has compared the project to recently acquired Lumina Copper's Taca Taca in Argentina and you can find more on McEwen Mining website. 
  There are money for the good large scale copper projects and China's MMG will invest USD 3 billion in the recently acquired Las Bambas. Lundin Mining acquisition of Copper assets in Chile brings us another indication for the industry insiders evaluation of risks and opportunities.  Read more."

I am very pleased to report our latest development on Los Azules.

We have finally locked up the participation in this unique world-class copper  asset for the benefit of all our shareholders:

1. Now we do not have to wait for feasibility study.

2. We do not have to contribute any capital.

3. Our industry standard NSR in "one of the largest undeveloped copper projects", according to McEwen Mining, is in effect immediately and can be monetised now at any time.

4. 0.4% NSR is now attributed to the entire Los Azules project - it is higher than pro-rata 0.6% attributed to only our part of Los Azules before.

5. We will participate in sale of Los Azules by McEwen Mining within 36 month and it is not affecting our NSR. 

6. We are receiving shares in McEwen Mining.

7. Now TNR Gold will benefit directly from:

A. Sale of Los Azules by McEwen Mining within 36 months.
B. Rise in value of McEwen mining shares.
C. Rise in Copper prices.
D. Potential increase in the deposit size and quality of the reported resources of the entire Los Azules.
E. Further feasibility studies conducted by the McEwen Mining or the new Operator and advancement of the project.

Jim Mustard VP of PI Financial can provide you with additional information on Los Azules Copper project and TNR Gold assets related to it.

Please read our full legal disclaimer in our presentation and on our website:

Stay tuned: new presentation will reflect this very important development for our company.

Nikkei ASian Review:

China's Strategic Stockpiling Sways Global Copper Market.

SHUHEI YAMAMOTO, Nikkei staff writer
TOKYO -- China's veiled yet substantial moves on the copper market are making it difficult for watchers to read the direction of prices.
     In early October, copper was trading around the $6,600 level per ton on the London Metal Exchange, about a five-month low. It was around this time that the term SRB -- which stands for China's State Reserve Bureau -- first gained market attention. A nonferrous metals trader at a foreign-affiliated brokerage said that the SRB will soon likely buy nearly 300,000 tons of copper.
     Also known as the State Bureau of Material Reserve, the SRB operates under the Chinese government's National Development and Reform Commission. Since the 1950s, China has been stockpiling strategic materials necessary for national security, including petroleum, food and copper.
Big spender
Amid a lackluster market, the SRB has aggressively bought copper this year. A local newspaper reported that the agency bought 500,000 tons of copper in the January-March quarter alone, accounting for about 5% of China's annual consumption. Many watchers see the global copper market as reaching saturation this year, but copper stock has dropped 60% on the LME and 30% on the Shanghai Futures Exchange since the beginning of the year. The widespread view attributes this to purchases made by the SRB.
     The SRB appears to have room for additional buying. Takayuki Honma, senior economist at Sumitomo Corporation Global Research, said the SRB acts as a system that operates in reaction to the market -- unloading its holdings when prices are high and buying on dips.
     China, the world's largest consumer of the copper, produces about 6 million tons of the metal per year, and there are many nonferrous smelters and mining companies operating in the country. A slump in copper prices could easily prompt the SRB to become a buyer in order to support these domestic producers. Indeed, the SRB did just that several times following the global financial crisis in 2008.
Forecasting blind
South Africa-based Standard Bank predicts that the global copper market will see a slight oversupply in 2015. However, the bank also said the SRB could possibly buy 150,000 to 300,000 tons of copper in the next six months, which, combined with other factors, could lead to a shortage in the next year.
     In contrast, Goldman Sachs of the U.S. expects copper to move at around $6,600 for the next three months, a bearish forecast. But the investment bank also said it would be a different story if the SRB buys a huge amount of copper, indicating that its forecasts, too, depend largely on the Chinese agency.
     Market players can figure out what the SRB is doing to some extent through local media reports and other sources, but the information is very limited, according to Yoshikazu Watanabe, president of Tsukushi Shigen Consul, a Japanese consultancy specializing in nonferrous market trends. With little official information being disclosed, market players have scant hope of gaining a clear picture of the situation. Nikkei."

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