Approval of New Infrastructure Bill Sparks Enthusiasm for Copper
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NEW YORK, Nov. 23, 2021 /PRNewswire/ -- Last week, US President Joe Biden unveiled one of the largest infrastructure plans in U.S. history. The bipartisan approval targets up to $1.2 trillion in funding, including $550 billion in new investments for bridges, airports, the nation's waterways and policies, transit, and more. Much of the bill targets electrification for infrastructure, buildings, and fleets of government vehicles. In addition to financing renewable energy, the infrastructure bill also provides $7.5 billion for electrification of public transport and an additional $7.5 billion for charging stations for electric vehicles (EVs), which is expected to drive demand for industrial metals and battery materials like copper, lithium, cobalt, nickel, and more. Companies mining these metals and materials like Wheaton Precious Metals (TSX:WPM) (NYSE:WPM), Hudbay Minerals (NYSE:HBM), Taseko Mines Ltd. (TSX:TKO) (NYSE:TGB), Copper Mountain Mining (TSX:CMMC), and Kutcho Copper (TSXV:KC) (OTCQX:KCCFF) could be on the precipice of a mining boom due to this bill.
Canadian resource developer Kutcho Copper (TSXV:KC) (OTCQX:KCCFF) just achieved a significant milestone at its Kutcho copper and zinc project in northern British Columbia, announcing the completion of its 2021 feasibility Study. After receiving positive project economics, Kutcho is now ready to move to the next phases on its path to production including the permitting process for the project.
Some of the highlights of the feasibility study include an after-tax Net Present Value (NPV) 7% of C$461 million, an Internal Rate of Return (IRR) of 25%, and low-cost production with all-in-sustaining costs (AISC) of US$1.80 per pound of copper equivalent (CuEq). The initial capital cost was also estimated to be low, at only C$493 million.
The study also confirmed that the project has a high-grade mineral resource of 8 million tonnes grading 2.26% CuEq 1.1 billion pounds CuEq, including 764 Mlbs Cu and 1,096 Mlbs Zn.
"The Feasibility Study represents a major milestone for Kutcho Copper as we continue to advance the high-grade Kutcho copper-zinc project towards a development decision," said Kutcho Copper President and CEO Vince Sorace. "The results of the Feasibility Study highlight the attractive economics of the Kutcho project which are resilient at lower metal prices, very attractive at base case prices and exhibit significant leverage to rising prices as reflected in spot metal prices with a C$931 million after-tax NPV7% and a 41% IRR. We believe that the results of the Feasibility Study mean that Kutcho Copper is now one of the most undervalued copper investment opportunities in North America."
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