Investment Opportunities
It is important to bear in mind that Chile is currently the largest copper producer in the world due to its geological evolution, reaching approximately 5,000,000 tons of copper metal/year in 2004 among major (over 100,000 tons of copper/year), medium (between 10,000 tons and 100,000 tons of metal/year) and small size producers (under 10,000 tons of metal/year).
There are numerous investment opportunities for the development of copper mining business, particularly if new technologies with significant cost or processing advantages such as those being proposed by Metex are available.
Unlike other metallurgical service or patent royalty companies, our particular structuring, which includes acquiring partial mine ownership, will allow the company to achieve profitability within the first year to first year and a half; and our primary objective will be to maintain high profitability at all times as the company grows. This will be achieved through the production of high value-added, high-purity copper metal products, directly from copper ores (and eventually from copper concentrates), such as copper cathodes and copper powder, at low cost and in an environmentally acceptable manner.
We seek equity financing which will enable us to:
Stage 1 – Industrial Pilot Test:
Continue pilot testing of ores from our initial mining projects and carry out pre-feasibility evaluation of pilot tests prior to copper production plant design and engineering; Validation tests, column tests, heap leaching test and up to pre-feasibility evaluation of commercial copper powder plant.
Cost: US$ 650,000 for test period, 12 months.
Stage 2 – Mine Acquisition
Sign an option agreement to acquire an interest in an existing mining project with sufficient reserves in quality and quantity to carry out the industrial demonstration project, prior to a full-blown copper production plant; Reconnaissance, evaluation and option to purchase copper mine with 500,000 to 1,000,000 tons of copper ore @ 2% Cu grade or better.
Cost: US$ 1,000,000 for acquisition period 8 months; it can start immediately after validation tests show positive results and thus overlap with industrial pilot test period; expected returns on investment after taxes are in the order of US$ 60 to 120 million for those ore deposit size ranges
Stage 3 – Commercial Copper Powder Plant:
Modular plant concept considers staged development from 400 metric tons to 10,000 metric tons of copper powder/year.
Construction period for small plant for 400 tons of copper powder/year, including engineering, construction, and copper ore stockpiling and equipment procurement can take 12 months.
Engineering can start at the completion of 350 kg column leaching tests and overlap with the 3 ton columns tests.
Procurement can start at the end of the 3 ton column tests and upon positive results from them.
Cost: The initial 400 tons/year plant has an estimated cost of US$ 4,000,000 and the larger plant an estimated cost of US$ 20,000,000. (It could be smaller given economies of scale; plant production growth evolution will depend mainly from ore deposit reserves size and mine capacity, plant site environmental approval, market access and product commercialization)
Expected Cash flow for Returns on Investment Prediction
Cash flow will be designed on a staged per-project basis; project cash flow execution will depend on progress reports and engineering planning.
The following analysis is based on the assumption of Copper Price 550 c/lb and LIXS2 Leashing Plant 100,000 tpy of ore.
Risks
The company's future success is substantially dependent upon continued growth in the use of the patented and tested metallurgical processes, the establishment of joint ventures with mining companies and the granting of licenses to use these processes to third parties under patent and technology use licensing agreements.
There can be no assurance that the number of metallurgical processes licensee companies will grow fast or become widespread in a short time horizon of say 2 to 3 years; we believe it will eventually develop and be accepted as an economic way of production once the demonstration plant is set up and operates for a period of say one and a half to two years, and perhaps even simultaneously with the first commercial operating plant for a while. However, the joint venture scheme has the advantage of allowing one or more operations to be set up which will be economically producing sufficient revenue to recover many times the initial investment set forth here. In particular, the small and medium size miners will be impelled to take up the new technology as a powerful means of increasing their recoveries, return on investment and profits as they move away for their current relatively inefficient copper recovery processing schemes.
Here are some questions investors often ask.
Q. Why is Metex innovative?
A. Innovation in the Copper industry is essential to reduce production costs, increase final product added value, maintain technological leadership, and improve investment returns.
Q. How other competitor's processes work?
A. Process via concentration-smelting-refining is polluting, and pollution control is costly. Current copper ore treatment processes cannot leach mixed ores (oxide-sulphide mixtures). Bacterial sulphide leaching is slow and relatively inefficient at ambient temperatures, implying slow returns and inventory costs.
Q. Can these problems be solved?
A. The LIXS2 heap-leaching process (US Patent Office 6,569,391 B1) developed by METEX can solve them.
Q. What is the LIXS2 Heap Leaching Process?
A. It's a new, fast and efficient acid-oxidizing metallurgical process which frees copper from copper sulphide and mixed ores. This process is economic and environmentally compatible.
Q. Which are LIXS2 advantages?
A. It works at room temperature and can use existing leaching plant, which leads to low infrastructure cost; it’s about US$ 45 cents of operational costs per pound.
It allows leaching metallic copper in two steps:
1 - Leaching.
2 - Electro winning (cathode or copper powder final product)
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