Investors

FAQs

Q. What is Copper Fox's corporate strategy?

A. Copper Fox is focused on the exploration and development of large, potentially long-life copper projects in North America.  Our strategy is simple, acquire large, low-cost porphyry copper projects, explore these projects and, if successful, advance them to the stage where monetization of the project yields a fair value return to shareholders.  Copper is an important critial metal for environmental protection with excellent near to medium term supply/demand fundamentals.  Demand is expected to exceed supply as early as mid 2023.   Our project portfolio combined with the near term supply/demand are important aspects of executing on our corporate strategy.

Q. Does the current Copper Fox stock price accurately represent the net asset value of the company?

A. There is a significant gap between the recently established NAV of Copper Fox and its current market price.  For junior companies like Copper Fox the share price would be expected to be in the order of 0.5 to 0.7 X NAV.  Currently Copper Fox is trading at 0.12 to 0.15 of its NAV.  Copper Fox’s NAV is based on the 2020 and 2021 Preliminary Economic Assessments for the Van Dyke and Schaft Creek projects, both of which were prepared by independent engineering companies.  Several market factors can contribute to the gap between the market price and NAV, especially in junior resource companies, such as micro and macro economic events, market awareness, commodity prices, market sentiment and investor perception to name a few.

Q. Do the NPVs in the Technical Reports reflect current copper and gold price and foreign exchange scenarios which would have been used as input parameters?

A. The metal prices and foreign exchange rates (‘FOREX’) used in financial analysis of an advanced stage project are based on long-term industry consensus forecasts as at the Effective Date of the Technical Reports.  These parameters, as well as capital and sustaining costs, change over time, which in turn, can materially impact the conclusions and economic forecasts.  For example, the FOREX used in the 2013 Schaft Creek Feasibility Study was $US1.00:$C0.97 whereas the long-term FOREX in the 2021 PEA was $US1.00:$C0.77; a significant positive difference in Canadian dollar terms. To illustrate the affect FOREX has on metal pricing, in 2013, the base case analysis used a copper price of US$3.25/lb or C$3.35/lb, as at the Effective Date of the 2021 Van Dyke PEA the consensus long-term copper price was US$3.15/lb or C$4.09/lb.  Currently the long term consensus pricing for copper is US$3.93/lb.  As these examples demonstrate, changes in the FOREX and long-term metal prices can have a significant impact.

Q. What keeps the insiders interested in the company and what is their long term objective?

A. The insiders own approximately 58% of the shares of Copper Fox.  The Company’s efforts to advance its portfolio of advanced and exploration stage projects has resulted in establishing significant value in both the Schaft Creek and Van Dyke projects and project enhancements, which if successful, could add value to both projects.  The Company continues to advance its exploration stage projects that is expected to result in drilling programs which could result in a new copper discovery.  With copper designated as a critical metal and bullish supply/demand fundamentals in conjunction with several project enhancements, the corporate strategy is to advance the Schaft Creek and Van Dyke projects to a stage that demonstrates fair value for the shareholders at which time a monetization decision could be taken. 

Q. Do you have the necessary capital resources to complete your annual objectives?

A. Yes, with the cash on hand and exercise of “in the money” warrants, the work programs on Copper Fox’s operated projects would be fully funded to the end of fiscal 2022.  Budgets and programs for the 2023 year are being prepared for board review.  The Schaft Creek Joint Venture calls for Teck Resources Limited to provide all the funding required to explore and advance the Schaft Creek project.

Q. Why have you chosen to operate in the province of British Columbia ("BC") in Canada and in the state of Arizona in the USA?

A. Both areas are recognized as “proven copper provinces” in North America with significant potential to discover large “world class” polymetallic porphyry copper deposits.  Both areas are Tier 1, geopolitically stable pro-mining jurisdictions with excellent infrastructure and rigorous environmental and permitting processes which are well defined, manageable and achievable.  

Q. Aside from environmental issues, don't you have to deal with Indigenous issues in both BC and Arizona?

A. In BC, the Schaft Creek and Eaglehead projects are located in Tahltan Territory, Copper Fox has worked with the Tahltan Nation since 2005 when it commenced operations on the Schaft Creek project.  Copper Fox has developed a strong relationship with the Tahltan Nation through open and transparent discussion on issues that are important to the Nation, such as respect for cultural and traditional values, wildlife management, environmental assessments, employment opportunities and participation in community and social affairs.  In Arizona, compliance with state and federal laws along with engaging ongoing communication with the people living in the vicinity of our projects is a core principle of the Corporations ESG policy and the basis of our community relationship policies.

Q. How would you describe the exploration potential of your five properties beyond the billions of pounds of copper resources currently identified?

A. The Schaft Creek and Van Dyke projects each have established resources exceeding billions of pounds of copper, more if looked at on a copper equivalent basis.  The mineralized envelopes in the Schaft Creek and Van Dyke deposits are open in several directions.  Several drill ready exploration targets are located in proximity to these deposits.

Our three exploration stage projects are considered to have significant potential to result in a copper discovery.  These projects exhibit large porphyry ‘footprints’, intrusive rocks of the right age, and multiple exploration targets all displaying the mineralization alterations and geophysical signatures associated with porphyry copper systems. 

The Eaglehead project has 120 drill holes exhibiting porphyry style mineralization with mineralized intervals ranging from 6m to 521m in the East zone.  The regional setting and size of the porphyry footprints on both the Mineral Mountain and Sombrero Butte projects indicates potential for a copper discovery.

Q. Your most advanced project, Schaft Creek, is a Joint Venture with Teck whereby Teck holds 75% and is Operator. Will they continue to invest in the project given the current challenges facing large corporations such as Teck?

A. Only Teck can answer that question. Schaft Creek is one of the largest undeveloped porphyry copper deposits in North America with substantial by-product metal credits.  Since the project was elevated to Teck’s Project Satellite initiative in 2017 the Schaft Creek Joint Venture has been investigating various optimization alternatives with the overall objective of surfacing value.  The 2022 budget for Schaft Creek is estimated to be in the order of C$6.6 million, funded by Teck and is the largest program undertaken by Teck since formation of the Schaft Creek Joint Venture. Since the project was elevated to Teck’s Project Satellite initiative in 2017 the Schaft Creek Joint Venture has been investigating various optimization alternatives with the overall objective of surfacing value.  The 2021 Preliminary Economic Assessment was based on the results of the work programs completed since 2013 by Teck, as Operator of the Schaft Creek Joint Venture, which yielded a US$842 million (100% basis) after tax, discounted value of the project.  Going forward, the Schaft Creek Joint Venture is focussing on improving metallurgical recoveries, reducing the Life of Mine strip ratio, reducing the pre-production timeline and pursuing additional project enhancements to increase project valuation.  With a 133ktpd throughput scenario, (@ 92% nominal capacity) and forecast to produce approximately 400,000t of copper concentrate annually, Schaft Creek is one of the large development stage projects under consideration and would be of considerable interest to metal trading and smelting companies and all large copper producers, including Teck.

Q. Why did Copper Fox complete updated Resource Estimates and PEAs on the Van Dyke and Schaft Creek copper deposits?

A. Resource estimation and PEA level studies are completed by independent engineering firms.  The PEA’s provided Copper Fox an opportunity to update its shareholders and the investing public on the technical and financial information for the projects based on certain input parameters related to each project and identified potential project enhancements for further investigation to surface additional value in each project.

In 2013 Copper Fox completed a feasibility study on the Schaft Creek project that yielded (on a 100% basis) an after-tax discounted value of US$64 million.  While this was considered a positive, the project valuation was substantially below that required for a sanction decision but sufficient to warrant further investment to investigate project optimization/potential enhancements.  The 2013 feasibility study resulted in Teck exercising its ‘back in’ right, clarified the ownership interest of the Schaft Creek project and led to the creation of the Schaft Creek Joint Venture.  The 2021 PEA was based on the results of the work programs completed by Teck, as Operator of the Schaft Creek Joint Venture, and yielded a US$842 million after tax discounted value of the project.  The PEA also provided Copper Fox an opportunity to provide its shareholders and investing public updated technical and financial information for the project.  Going forward, the Schaft Creek Joint Venture is focussing on improving metallurgical recoveries, reducing the Life of Mine strip ratio, reducing the pre-production timeline and pursuing additional project enhancements to increase project valuation.  

Since the acquisition of the Van Dyke project our work programs advanced the geological understanding of the deposit and increased the total soluble copper content of the deposit, resulting in a higher confidence in the resource model.  Increases in soluble copper content within the deposit, higher metallurgical recoveries, and the updated geological model strongly indicated the potential to increase the project valuation, providing the Company the confidence in the business opportunity.  For example, the 2015 PEA (@ $US3.00/lb copper), yielded an after tax discounted valuation of $US149 million whereas the 2020 PEA (@ $US3.15/lb copper) yeilded an after tax value of $US645 million.  The conservative copper pricing and potential to expand the soluble copper resource indicates potential to increase mine life and potential NPV of the project.