2/9/2015 6:00:00 AM
Chloride copper mine investor left in the dark
Hubble Ray Smith
Miner Staff Reporter
CHLORIDE - Paul Schubert would like for someone from Sierra Resources to at least have the courtesy to take his phone calls as an investor in the company's Chloride copper mine.
He's been following Sierra Resources on the Internet from his home in Ontario, Canada, since investing in the company a while back, regrettably when the price was much higher than today's .02 cent per share. He's embarrassed to say exactly how much higher.
Schubert wants to know the status of the Chloride mine. It's been nearly two years since Sierra Resources announced it had submitted its mine plan of operation with the BLM and air quality permit with the Arizona Department of Environmental Quality.
Former Sierra Resources Chief Executive Officer Rod Martin said the company was moving forward and intended to complete the project. He has since resigned and has been replaced by Tim Benjamin.
Calls to Sierra Resources' headquarters in Las Vegas were not returned.
Former CEO Martin told the Daily Miner he couldn't discuss the company due to his involvement in pending litigation.
"The company itself seems to have gone to ground, leaving the field open to rumors from investors who, for reasons of self-interest, seek either to promote or deflate interest in the company's prospects," Schubert said in an e-mail to the Miner. "I myself cannot really tell if there has been a good-faith effort to revive the mine or whether the only serious mining has been targeted at the pockets of investors."
There have been some recent developments in attaining financing necessary to re-enter production of copper and secondary zinc concentrate at the Chloride mine. Key Capital Corp. and Red Rock Assets are working on a $13 million finance package. The project has potential to provide lenders with an estimated return of 13 percent to 15 percent, according to a financial summary.
"We're working with Key Capital. They're technically the lender," said Matthew Friedman, chief executive officer of Red Rock Assets. "We are in the middle of conversation with different groups to raise money."
The Chloride mine ceased operations in 1993 when copper prices sank below $1 a pound. Copper rose to about $2.60 a pound this week on news of a Chinese economic stimulus.
The mine has extensive infrastructure and processing facilities in place that can readily be refurbished or upgraded to restart the mining operation. Sierra Resources hired engineering consultants CDM Smith to complete all federal and state permitting, which is nearly complete, as well as civil engineering work and construction to enable full production.
The mine is forecast to produce about 42.7 million pounds of copper over the life of the loan and generate $141 million in revenue.
All of these developments come without so much as a "peep" from the company, Schubert said.
"I don't claim to know what the industry standards are in this area, but the lack of transparency and accountability to shareholders seems astounding," he said.
Chloride copper mine investor left in the dark
Hubble Ray Smith
Miner Staff Reporter
CHLORIDE - Paul Schubert would like for someone from Sierra Resources to at least have the courtesy to take his phone calls as an investor in the company's Chloride copper mine.
He's been following Sierra Resources on the Internet from his home in Ontario, Canada, since investing in the company a while back, regrettably when the price was much higher than today's .02 cent per share. He's embarrassed to say exactly how much higher.
Schubert wants to know the status of the Chloride mine. It's been nearly two years since Sierra Resources announced it had submitted its mine plan of operation with the BLM and air quality permit with the Arizona Department of Environmental Quality.
Former Sierra Resources Chief Executive Officer Rod Martin said the company was moving forward and intended to complete the project. He has since resigned and has been replaced by Tim Benjamin.
Calls to Sierra Resources' headquarters in Las Vegas were not returned.
Former CEO Martin told the Daily Miner he couldn't discuss the company due to his involvement in pending litigation.
"The company itself seems to have gone to ground, leaving the field open to rumors from investors who, for reasons of self-interest, seek either to promote or deflate interest in the company's prospects," Schubert said in an e-mail to the Miner. "I myself cannot really tell if there has been a good-faith effort to revive the mine or whether the only serious mining has been targeted at the pockets of investors."
There have been some recent developments in attaining financing necessary to re-enter production of copper and secondary zinc concentrate at the Chloride mine. Key Capital Corp. and Red Rock Assets are working on a $13 million finance package. The project has potential to provide lenders with an estimated return of 13 percent to 15 percent, according to a financial summary.
"We're working with Key Capital. They're technically the lender," said Matthew Friedman, chief executive officer of Red Rock Assets. "We are in the middle of conversation with different groups to raise money."
The Chloride mine ceased operations in 1993 when copper prices sank below $1 a pound. Copper rose to about $2.60 a pound this week on news of a Chinese economic stimulus.
The mine has extensive infrastructure and processing facilities in place that can readily be refurbished or upgraded to restart the mining operation. Sierra Resources hired engineering consultants CDM Smith to complete all federal and state permitting, which is nearly complete, as well as civil engineering work and construction to enable full production.
The mine is forecast to produce about 42.7 million pounds of copper over the life of the loan and generate $141 million in revenue.
All of these developments come without so much as a "peep" from the company, Schubert said.
"I don't claim to know what the industry standards are in this area, but the lack of transparency and accountability to shareholders seems astounding," he said.
