Cyprium Metals (ASX: CYM) shares crashed 70% today. This isn’t entirely happy for CYM shareholders, of course, but it’s also not quite the disaster it may seem. For Cyprium is coming back from a long suspension so we’ve some time’s worth of price movement all collapsed down into the one day’s action.
The real deal here is that CYM has been able to recapitalise and can now actually get started on the first stages of the business plan. In the long term this is to open - reopen - a copper mine but the financing isn’t enough for that, obviously. However, it should be possible to get some reprocessing work done and so start to produce revenue: “The Nifty Copper Mine (“Nifty”) is located on the western edge of the Great Sandy Desert in the northeastern Pilbara region of Western Australia, approximately 330km southeast of Port Hedland. Nifty
contains a 2012 JORC Mineral Resource of 940,200 tonnes of contained copper. Cyprium is focussed on a business plan to develop a large open pit mine. Initially to provide ore to an existing heap leach SX-EW operation and to retreat the current heap leach pads. The restart of the existing copper concentrator to treat open pit sulphide material will commence once technical studies and approvals have been obtained for the larger operating footprint expected within 4 years. Combined target production rate is 65,000 tonnes of copper in cathode and concentrate.”
Cyprium Metals share price from Google Finance
One thing worth noting. Mining and extraction technologies do move on. So, one of the best places to go prospecting when there’s a new technology is at the old mines. What used to be non-economic with the old techs often does prove to be economic with the new. This is what reprocessing the old heap leach pads is about there. Old techniques left some appreciable amount of copper behind, new ones can gain some amount of that.
Of course, this isn’t about to create a vast, Tier 1, copper deposit. But that reprocessing of old gangues and wastes can indeed be an entirely profitable exercise. It’s also true that the new techniques then make the lower grade ores, ignored by the old techs, worthwhile again - so it’s sensible to start mining again.
The thing it’s necessary to note therefore. It’s not just that prices have changed therefore the old mine’s worth another go. It’s that both selling prices and extraction prices have changed therefore the entire equation is different. Of course, Cyprium may do well or badly at this. But it’s a common enough mining plan that they’re following.
Tags: Cyprium Metals, ASX CYM
https://newswire.iguana2.com/af5f4d73c1a54a33/cym.asx/6A1169492/CYM_Reinstatement_to_Official_Quotation
https://www.google.com/finance/quote/CYM:ASX?hl=en&window=1Y
https://www.proactiveinvestors.com.au/companies/news/1026750/cyprium-metals-completes-31-6-million-equity-raising-to-advance-nifty-copper-mine-restart-strategy-1026750.html
https://www.fool.com.au/2023/09/21/why-did-this-asx-copper-share-just-crash-70/