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Pacific Booker Minerals Inc. (PBM-NYSE:AMEX, BKM-TSX.V) |
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October 23, 2009 Issue |
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Pacific Booker Minerals Inc. Is Well Positioned With Their 100% Owned Diversified Copper, Gold, Molybdenum And Silver Morrison Project, No debt, A Completed Feasibility Study And Submitted Environmental Assessment Application Leads Them On Their Way To A Successful Venture |
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Pacific Booker Minerals Inc. (PBM) owns the
Morrison property located in Central British Columbia, 35 km north of the
Village of Granisle.
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Interview conducted by: Lynn Fosse, Senior Editor, CEOCFOinterviews.com, Published – October 23, 2009
Mr. Anderson: This project was brought to me by a financier back in 1997. I really was not that interested in it at that point because copper was only .62 cents. However, a business associate of mine, John Plourde, who is a director of the company as well as me, urged me to join him. After considering it for several months, I decided to help. I agreed to raise some money for exploration and they the company did as well so we drilled about nine holes in that the first drill program on the Morrison property. The fourth hole we drilled on our Morrison property was one of the richest ones in porphyry history in central British Columbia. That is how I got started. Today, I have continued to help finance the company and in fact, back in 2005 I took over as President, CEO and executive director of the company. Regarding The Morrison project, we should have it in production sometime in the next 24 months.
CEOCFO: What is the status of the project today? Mr. Anderson: We own our Morrison project 100%, with absolutely no Net Smelter Return (NSR). It is located in friendly British Columbia and we are very fortunate because we are in an area that has an existing infrastructure due to previous mining in the area. In fact, we purchased this ore body from Xstrata (formerly Noranda), who had been mining in the Lake Babine area over a 35 to 40 year period. Noranda mined two other projects, the Granisle project and the Bell copper project, which are located within 29 kilometers of the Morrison project. The Bell copper project is only about 20kilometers south of us. We have high-speed logging roads, two established mining camps, electric power close by and deep sea shipping ports. As well as the city of Granisle, which was built by Noranda for mining and is within a 45-minute commute. This built in infrastructure will save the company hundreds of millions of dollars of capital expenditures and allow us to more quickly go into production.
CEOCFO: What is the status of the project today? Mr. Anderson: We have taken this project from a Greenfield project all the way to completing a positive feasibility study early this year. All the reports that need to be completed are done. This month we just completed our forty-month, $6 million environmental assessment report and have submitted our environmental assessment certificate application to the B.C. government. They have accepted it for screening. We are just getting started with that process, and while we are going through this process, we will be finalizing our contracting strategy for pre-production and tendering pre-production contracts for engineering, procurement and construction. We will be ordering our long lead items like our high-pressure grinders; we will be using high-pressure grinders versus Sag mills. It will cost more initially but in the long run it can save us as much as 23% of our operating cost, which amounts to about $0.67 cents/ tonne. Finally, we look forward to acquiring our environmental certificate by early next spring 2010 followed by the required mining permits then on to construction and production
CEOCFO: What else might you be doing in the way of technology and newer or different approaches? Mr. Anderson: Of course, we are going to be as creative as possible. I think the biggest thing we decided was to use high-pressure grinders (HPGR). As I stated earlier HPGR, technology will cost more initially but will save the company a considerable amount of operating and consumables cost. In addition, we are thinking green: one example of many is the fact that we will be using hydro electricity. Which of course is a renewable and sustainable energy resource resulting in a very small carbon footprint. Further, we have negotiated a situation with BC Hydro to purchase electricity at very reasonable rate and Xstrata who agreed to allow us to bring the power in from the Bell copper substation. The Bell is located just 20 kilometers South of the Morrison and on an already existing high speed logging road. Another example would be that we are considering running our trucks and other equipment on liquefied natural gas (LNG). Again a smaller carbon foot print.
CEOCFO: What is the availability for both the people and the equipment? Mr. Anderson: Both are readily available. We are very fortunate to be in an area that pretty much existed on forestry and mining, but over the years there has been considerable damage to the forests from a parasite in the trees; actually a beetle. Therefore, the forestry industry has cleared a lot of timber and the forestry work is ending resulting in many people looking for work there. The other fortunate thing is that there has been mining in that area for many decades, so people are used to it. They know it is a good way to make a living, and it is long-term for them and us. Our project runs at least 21 years. Regarding equipment, we do not foresee any problems with procurement at this time.
CEOCFO: What do you expect to be able to produce on a regular basis? Mr. Anderson: As far as production goes, we are expecting to mill 30,000 tonnes per day, and that will be year-round producing about 150,000 tonnes of concentrates per year, with a very low mining cost of only C$8.15 per tonne running about 21 years. Our feasibility study states a resource of 224-million tones of minable ore, with a copper equivalent grade of .42%. In recovery metals, in other words metal that is actually recovered. Our feasibility report states we have 1.37 billion lbs of copper, 658-million ounces of gold, 10.05 million pounds molybdenum and a silver credit. The silver estimate is approximately 6.5 million ozs. This gives us a Net Present Value (NPV) for this project at an 8% discount of about a half a billion dollars and an Internal Rate of Return (IRR) of 20%.
CEOCFO: What is the financial picture of Pacific Booker today? Mr. Anderson: Currently we have no debt. We have plenty of cash in the bank to complete what we need to do prior to whatever kind of financing we put into place to construct the mine. I would also like to note that we have had inquiries from all over the world and a great response to our project and at this time feel very optimistic regarding project funding and off take.
CEOCFO: What challenges if any are you on the look-out for? Mr. Anderson: As far as challenges go, it is a mining project and there are always challenges.
CEOCFO: What is your two-minute take on the gold cycle, demand, expectations? Mr. Anderson: That is a difficult question. When you look at the financial crisis that has gone on around the world, it seems that it is not going to end soon. I believe the recovery is going to be slow with volatility in stocks, commodities and currencies but sooner or later there has to be a reckoning. Meanwhile demand for gold is going to be strong for many reasons. One reason is I think with emerging nations such as China, and India, and especially with China, trying to diversify what they are holding in reserves, you are going to see them buying more and more resources around the world. One of the main ones they are looking for is not only oil but also precious metals like gold and metals like copper. Another reason is that gold historically is a hedge to financial volatility; even central banks around the world have stopped selling it and are now on the buy side. I expect the precious metals and the base metals to trade in the channels that they are now and maybe even higher in the future. I can see those taking small corrections as normal, but in the long-term, I am seeing higher channels, plus what it costs to put projects into production, you have to have prices in a certain range. The low hanging fruit in precious and base metals mining companies throughout the world is starting to disappear and grades are dropping in most of the major mines. It has lent itself to higher prices for both base and precious metals.
CEOCFO: Why should potential investors be interested in Pacific Booker Minerals?
Mr. Anderson:
At Pacific Booker, we are not just a copper project. We are transitioning
into a production company with a great project located in a friendly British
Columbia, Canada. We have an experienced management team, and a diversified
project, with copper, gold, molybdenum and silver. The company has
absolutely no debt, with only 13.9 million shares out fully diluted. We have a broad and loyal shareholder base. We trade on the NYSE:AMEX, as well as the Venture Exchange in Toronto (TSX.V). Currently we are very close to production and I believe the world is going to continue to grow and the demand for raw materials will grow right along with it. PBM is positioned to profit from future demand and maximize shareholder return.
CEOCFO: Do you think it helps to be on the AMEX? Mr. Anderson: Yes I do. It is tough to get listed these days so when a company like ours can achieve a listing on a well-known exchange like the NYSE:AMEX it lends a lot of credibility to us as well as exposing us to a much larger potential investor base.
CEOCFO: When will the mine be up and running? Mr. Anderson: We are anticipating having our mining commence in late 2011 or early 2012, so we should be breaking ground next year.
CEOCFO: It is a long cycle but you are nearing the finish line. Mr. Anderson: Yes we are.
CEOCFO: Final thoughts, what should people remember most about Pacific Booker Minerals?
Mr. Anderson:
PBM has a great low- cost project with an experienced management team. We
are working in a very safe geopolitical area that is friendly to mining and
with interest in the Morrison project from around the world. PBM is
positioned to have a successful venture and maximize its shareholders
return. |
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PBM has a great low- cost project with an experienced management team. We are working in a very safe geopolitical area that is friendly to mining and with interest in the Morrison project from around the world. PBM is positioned to have a successful venture and maximize its shareholders return. - Gregory Rae Anderson |
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Gregory
Rae Anderson