CALGARY, Sept. 16 /CNW/ - Elmer Stewart, President and CEO of Copper Fox Metals Inc. (TSX Venture: CUU) is pleased to provide an update on corporate activities and the third quarter financial results. The Board of Directors of the Company has approved an $8.0 million budget to complete the feasibility study on the Schaft Creek copper-gold-molybdenum-silver deposit. Funding for the completion of the feasibility study is expected to come from the exercise of warrants and cash on hand. The Company also reports a loss of $490,856 for the three months ended July 31, 2009 compared to a loss of $1,307,400 for the three months ended July 31, 2008.
The Company has strengthened its working capital position during the quarter with the raising of $5.8 million of new capital. Mr. Stewart said, "This new capital has allowed the Company to pay off its existing obligations to creditors and put the Company back into a position whereby it can concentrate its full efforts on completing the feasibility study on the Schaft Creek property. The Company has already spent over $40,000,000 related to the completion of this study and has now secured a commitment from its major shareholder to provide the necessary funding to move forward and complete this process." Mr. Stewart added, "The announcement today by the federal government to provide support and fund a portion of the construction of the power line to northwest British Columbia is an extremely positive development in relation to the development of the Schaft Creek project. We are optimistic that the feasibility study and the recent announcement on the power line should enhance the economic viability of the Schaft Creek deposit."
Copies of the financial statements and notes and related management discussion and analysis may be obtained on SEDAR at www.sedar.com, our Company web site at www.copperfoxmetals.com or by contacting the Company directly. All amounts are in Canadian dollars unless otherwise stated.
Financial Highlights and Significant Items
The Company successfully completed two financings during the quarter to address its working capital deficiency and to provide funding for its operational plans. During the third quarter the Company raised $5,777,994 (net of selling costs of $226,006). As a result the Company was able to make arrangements to settle outstanding accounts with its creditors and to discharge encumbrances registered on its Schaft Creek property. The Company is now in a position to focus all of its attention on the completion of a bankable feasibility study to determine the economic viability of the Schaft Creek project.
A Special Meeting of the shareholders of the Company was held on Friday, July 10th which approved the private placement of Ernesto Echavarria to acquire 69,763,620 shares and 69,763,620 common share purchase warrants for gross proceeds of $3,924,204. This approval by the shareholders was the last of three transactions whereby Mr. Echavarria has acquired 88,888,889 shares and 88,888,889 purchase warrants of the Company for gross proceeds of $5,000,000 and becomes a control person of Copper Fox (as such term is defined in the TSX-Venture Exchange manual).
In addition to the $5,000,000 investment by Mr. Echavarria, an additional $1,000,000 private placement with the same terms and conditions was completed.
Selected Financial Information
per share - basic
Net (loss)/income and diluted
Third Quarter $ (490,856) $ -
Second Quarter $ (353,763) $ -
First Quarter $ (29,135,359) $ (0.28)
Fourth Quarter $ 1,890,230 $ 0.02
Third Quarter $ (1,307,400) $ (0.01)
Second Quarter $ (720,878) $ (0.01)
First Quarter $ (598,554) $ (0.01)
Fourth Quarter $ (1,215,394) $ (0.02)
The Company had a working capital deficiency at October 31, 2008 of $2,059,026. This deficiency was resolved at July 31, 2009 and the Company had working capital of $1,897,319 at July 31, 2009. This was as a result of the closing of two private placements in July 2009. Funding required for the feasibility study on the Schaft Creek deposit and to carry on other corporate activities is expected to come from cash on hand and the exercise of the warrants issued from the financings completed in 2009.
About Copper Fox
Copper Fox's activities are focused exclusively on Schaft Creek, one of the largest undeveloped copper, gold, molybdenum and silver deposits in Canada. Copper Fox has earned a direct 70% interest in Schaft Creek and, pursuant to the option agreement with Teck Resources Limited, may acquire an additional 23.4% interest (totaling 93.4% direct and indirect interest in the property) subject to certain back-in rights to Teck Resources Limited. Copper Fox has invested in excess of $40,000,000 in the Schaft Creek project.
Schaft Creek is located within a contiguous land package that comprises 20,932 hectares situated in northwest British Columbia, Canada. On September 15, 2008, Copper Fox released the results of a preliminary feasibility study ("PFS") on the Schaft Creek deposit which contemplated processing 100,000 tonne of ore per day from an open pit. The PFS estimated that minable reserves at Schaft Creek to be 812 million tonnes and that this deposit could produce 4.8 billion pounds of copper, 255.1 million pounds of molybdenum, 4.5 million ounces of gold and 32.5 million ounces of silver over a 23 year mine life.
ON BEHALF OF THE BOARD OF DIRECTORS
Elmer Stewart, P.Geol, MSc
President and CEO
The TSX Venture exchange has not reviewed the contents of this news release and accepts no responsibility for the adequacy or the accuracy thereof. This news release includes "forward-looking information" within the meaning of the Canadian securities laws. Statements, other than statements of historical fact, may constitute forward-looking information and include, without limitation: anticipated timing and content of upcoming work programs, geological interpretations, receipt of property titles, and potential mineral recovery processes; anticipated dates for receipt of permits, approvals and other milestones; anticipated results of drilling programs, feasibility studies and other analyses; anticipated availability and terms of future financing; future production, operating and capital costs; and operating or financial performance. Information concerning mineral reserve and resource estimates also may be deemed to be forward-looking information in that it reflects a prediction of the mineralization that would be encountered if a mineral deposit were developed and mined. For any forward looking information given, management has assumed that the assay results it has received are reliable, and has applied geological interpretation methodologies which are consistent with industry standards. Forward-looking information involves various risks and uncertainties. There can be no assurance that such information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such information. Important factors that could cause actual results to differ materially from management's expectations include: fluctuations in commodity prices and currency exchange rates; uncertainties relating to interpretation of drill results and the geology, continuity and grade of mineral deposits; uncertainty of estimates of capital and operating costs, recovery rates, production estimates and estimated economic return; the need for co-operation of government agencies in the exploration and development of properties and the issuance of required permits; 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; and other risks and uncertainties disclosed in the company's other filings with Canadian securities regulatory authorities at www.sedar.com. The forward-looking information in this news release is based on management's current expectations and Copper Fox assumes no obligations to update such information to reflect later events or developments, except as required by law. Additional information, about the risks and uncertainties of the Company's business is provided in its disclosure materials, including its most recent annual and quarterly filings, filed with the securities regulatory authorities in Canada available at www.sedar.com. The forward-looking information in this news release is based on management's current expectations and Copper Fox assumes no obligations to update such information to reflect later events or developments, except as required by law. Additional information, about the risks and uncertainties of the Company's business is provided in its disclosure materials, including its most recent annual and quarterly filings, filed with the securities regulatory authorities in Canada available at www.sedar.com.
SOURCE Copper Fox Metals Inc.
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