VANCOUVER, March 27, 2013 /CNW/ - Copper Fox Metals Inc. ("Copper Fox" or the "Company") (TSX-V:CUU.V - News) is pleased to announce its first quarter 2013 operating and financial results. Copper Fox incurred a net loss for the first quarter of $525,595 ($0.00 loss per share) and incurred $1,245,690 in expenditures toward furthering the development of the Schaft Creek project. Copies of the financial statements, notes and related management discussion and analysis may be obtained on SEDAR at www.sedar.com, the Company web site at www.copperfoxmetals.com or by contacting the Company directly. All amounts are in Canadian dollars unless otherwise stated.
During the quarter ended January 31, 2013, the Company announced the results of a positive Feasibility Study on the Schaft Creek project. Subsequently, on February 4, 2013, the Company delivered said study to Teck Resources Limited ("Teck"). The Company continues to discuss with Teck various aspects of the feasibility study and Teck's earn back options available under the "Teck Option Agreement" dated January 1, 2002. There can be no assurance that these discussions will lead to Teck exercising any of its earn back options nor that the Company and Teck will enter into a definitive joint venture agreement as contemplated under the Teck Option Agreement.
Environmental Assessment Application
Work completed through January 2013 focused on the BC Environmental Assessment Application (EAA) and the Federal Environmental Impact Statement (EIS). Specifically, the geochemical assessment of the resource, water management plan and water quality modelling were revised to incorporate the details of the mine plan within the December 2012 Feasibility Study into the EAA. Consultation and engagement with key regulatory agencies and the Tahltan Nation continue in advance of completion of the EAA and EIS.
Stantec Consulting Ltd. ('Stantec') and Copper Fox are currently working with other environmental consultants to complete the various studies and reports required for the EAA. On submission of the EAA the regulatory bodies would have 30 days to review the application before the environmental assessment review period commences.
In March 2013, the Company entered into a facilities study agreement (the "Facilities Study Agreement") with the British Columbia Hydro and Power Authority ("BC Hydro") in connection with the proposed electrical power supply to the Company's Schaft Creek project. The Facilities Study Agreement sets forth the terms and conditions for BC Hydro to perform a facilities study to assess the requirements to connect the Schaft Creek project to the forthcoming BC Hydro Bob Quinn electrical substation. The sustaining capital potion of the Feasibility Study includes a $200 million provision for construction of BC Hydro's Northwest Transmission Line.
During the quarter ended January 31, 2013 the Company received $1,665,000 in proceeds from a private placement and the exercise of options, and incurred an additional $1,245,690 of capital expenditures related to the Schaft Creek project.
Selected Financial Results
Net (loss)/income per share -
basic and diluted
Liquidity and Capital Resources
Copper Fox operates in a capital intensive industry in which the demands for capital to finance exploration and development of its Schaft Creek property as well as corporate overheads generally occur far in advance of the project being put into production and generating cash flow. The financial requirements of Copper Fox related to the potential development of the Schaft Creek project are mitigated to some extent by the obligations of Teck should they exercise their earn back right on the Schaft Creek property.
The Company's working capital was $5,042,203 at January 31, 2013 inclusive of an increase to prepaid expenses and deposits relating to an agreement on the Schaft Creek property and an increase in accounts receivable with respect to a tax credit claimed.
During the quarter ended January 31, 2013, the Company raised a total of $1,665,000 from the completion of a private placement totaling $1,500,000 and 194,118 options were exercised for total proceeds of $165,000. Additional funds will be required to complete the current planned activities and the Company may need to issue additional equity in connection with any development of the project.
About Copper Fox
Copper Fox is a Canadian-based resource development company listed on the TSX Venture Exchange (TSX-V:CUU.V - News) with a corporate office in Calgary, AB and an operations office in Vancouver, BC. Its major asset is the Schaft Creek copper, gold, molybdenum and silver deposit located in northwestern British Columbia, Canada for which a positive Feasibility Study was recently completed and filed on SEDAR at www.sedar.com.
Copper Fox holds title and a 100% working interest in the Schaft Creek project consisting of 56,267.54 hectares (139,040 acres). Included in this total are the "Schedule A" mineral tenures originally conveyed to Copper Fox pursuant to the Teck Option Agreement, which consist of 8,334.34 hectares (20,594 acres). The "Schedule A" mineral tenures are subject to a 3.5% Net Profits Interest held by Royal Gold, Inc., a 30% carried Net Proceeds Interest held by Liard and, together with the additional mineral tenures obtained by Copper Fox within the "Area of Interest" provided for in the Teck Option Agreement, an earn back option held by Teck. On completion of the Feasibility Study, Copper Fox earns Teck's 78% interest in Liard. Teck's earn back option to acquire either, 20%, 40% or 75%, of Copper Fox's interest in the Schaft Creek Project is triggered upon delivery of a "Positive Bankable Feasibility Study" (as defined) to Teck after which they have 120 days to make a decision. Should Teck elect to exercise its option for 75%, Teck is required to fund subsequent property expenditures up to a total of 400% of those incurred by Copper Fox ($85.34 million to December 31, 2012) and use its best efforts to arrange for project financing, including the Copper Fox portion. For full details of the Teck earn back option please refer to the Company's website www.copperfoxmetals.com.
The remainder of Copper Fox's registered interests in mineral tenures in British Columbia total 47,933.20 hectares (118,445 acres). These interests have been acquired by Copper Fox through mineral tenure acquisitions and mineral tenure purchase agreements subsequent to Copper Fox entering into the Teck Option Agreement. Certain portions of these registered mineral tenures are subject to inclusion within the Schaft Creek Project pursuant to the terms of the "Area of Interest" provision of the Teck Option Agreement.
Additionally the Company holds, through wholly-owned subsidiaries, mineral tenures located in Pinal County, Arizona (the 'Sombrero Butte Copper Project') and in Miami, Arizona (the 'Van Dyke BLM Claims'). For further information on these mining projects please refer to the Company's web site at www.copperfoxmetals.com .
On behalf of the Board of Directors
Elmer B. Stewart
President and Chief Executive Officer
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Note Regarding Forward-Looking Information
This news release contains "forward-looking information" within the meaning of the Canadian securities laws. Forward-looking information is generally identifiable by use of the words "believes," "may," "plans," "will," "anticipates," "intends," "budgets", "could", "estimates", "expects", "forecasts", "projects" and similar expressions, and the negative of such expressions. Forward-looking information in this news release includes statements about the expected transmission voltage service forecasted for the Schaft Creek project, the expected timeline for completion of the facilities study, the expected costs to complete the facilities study, the acceptance of the facilities study, the expected execution of a facilities agreement, the expected timeline for completion of energization, the additional costs associated with electrical service, the expected timeline for completion of the NTL and the expected costs for the NTL.
In connection with the forward-looking information contained in this news release, Copper Fox has made numerous assumptions, regarding, among other things: the expected transmission voltage service forecasted for the Schaft Creek project, the expected timeline and costs for completion of the facilities study is accurate, that the facilities study will be accepted, that a facilities agreement will be entered into, the expected timeline and costs for completion of energization is accurate, and the expected timeline and costs for completion of the NTL is accurate. While Copper Fox considers these assumptions to be reasonable, these assumptions are inherently subject to significant uncertainties and contingencies. Additionally, there are known and unknown risk factors which could cause Copper Fox's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information contained herein. Known risk factors include, among others: the expected transmission voltage service forecasted is inaccurate, the actual mineralization in the Schaft Creek deposit may not be as favourable as suggested; another deposit may never be discovered on Copper Fox's property, or contain anticipated mineralization, or mineralization of any significance at all; a detailed mine plan may not be completed in a timely manner, or at all; the possibility that future drilling on the Schaft Creek project may not occur on a timely basis, or at all; fluctuations in copper, the completed drill holes for which analytical results are not available may not return significant concentrations of either copper, gold, molybdenum or silver; commodity prices and currency exchange rates; conditions in the financial markets and overall economy may continue to deteriorate; uncertainties relating to interpretation of drill results and the geology, continuity and grade of mineral deposits; uncertainty of the metallurgical testwork, the uncertainty of the estimates of capital and operating costs, recovery rates, and estimated economic return; the need to obtain additional financing to develop properties and uncertainty as to the availability and terms of future financing; the possibility of delay in exploration or development programs or in construction projects and uncertainty of meeting anticipated program milestones; uncertainty as to timely availability of permits and other governmental approvals.
A more complete discussion of the risks and uncertainties facing Copper Fox is disclosed in Copper Fox's continuous disclosure filings with Canadian securities regulatory authorities at www.sedar.com. All forward-looking information herein is qualified in its entirety by this cautionary statement, and Copper Fox disclaims any obligation to revise or update any such forward-looking information or to publicly announce the result of any revisions to any of the forward-looking information contained herein to reflect future results, events or developments, except as required by law.
SOURCE: Copper Fox Metals Inc.
Investor line 1-866-913-1910 or J. Michael Smith, EVP, at 1-604-689-5080.