Dr. John L. Faessel
ON THE MARKET
Commentary and Insights
"BEST IDEA" MOSQUITO GOLD (OTC:MQCMF) GARNERS NEW YORK TIMES FEATURE STORYLast Friday (9/17/2010) in the New York Times Business Day section reporter Phil Taylor from Greenwire and EandE Publishing penned an extensive (1683 words) article titled Molybdenum Exploration Sparks Debate Over Idaho Watershed. It's definitely worth a read.
Clearly, Mosquito (OTC:MQCMF) has definitely hit the big time with this New York Times article that follows the London Times and Dow Jones reported article* earlier in the year that stated that Mosquito’s wholly owned Idaho-based CUMO deposit is thought to be the world’s largest still undeveloped molybdenum deposit. With the recent first-class exposure of a proposed major mine now comes the environmentalists and critics; certainly Phil Taylor from Greenwire and EandE Publishing come from that mindset.
My handle on the article is that it's certainly great press and a full read of it gives you a pretty good handle on the necessary permitting that needs to be received from the Boise National Forest Service agency. From what I understand this particular permitting is pretty much a fait accompli in spite of all the hoopla. Tougher permitting will occur down the line, probably in a couple of years after further exploration and a mine-plan is developed.
A little backdrop here, from my perspective anyway; Boise county in Idaho where Mosquitoes massive CuMo asset lies contains only 4000 people and it's the poorest county in the state. I think that mining this treasure will bring untold billions of dollars to not only the United States and Canada, but certainly specifically to the state of Idaho and its environs. Most notably, the massive infusion of money into that poor county in Idaho will occur long before Mosquito will see any output from the mine as these enormous projects take several years to begin production. The positive economic impact to the region will be immediate, profound and lasting; indeed billions will be spent there. Talk about a stimulus plan―this is a REAL stimulus plan that will provide jobs for over 100-years.
In these days of deep uncertainty, economic stagnation and high unemployment the development of this major resource will inject a continuum of huge funding to a mining-friendly region in Idaho where unemployment is high and the region’s largest mine, the Thompson Creek Mine (TC) NYSE – only 60 miles from the CuMo asset - is nearly played out after 30-years of production. From what I hear miners from the region and its adjoining states are said to be making plans for a new “forever” job at the site.
The NY Times article states that Mosquito’s CuMo will bring about 1000 jobs to the area. I think likely it will be more than that. As a matter of reference; “Best Idea” Ivanhoe Mines (IVN) NYSE Oyu Tolgoi mine that’s now well into development has 4700 workers going at it 24 hours a day―soon to be over 6000 people working there I hear. No “ore” yet, but lots’ of digging to uncover and access that giant (world’s largest) copper / gold ore body. Now think about the number of family members and related entities that Oyu Tolgoi (and CuMo) will support. The economic multiplier to a region from a big mine is astonishing.
While there is clear evidence of past abuses to the environment going back 150 years to the days of Buffalo Bill today's new mining operations are much more environmentally sensitive. Mosquito’s management is very environmentally sensitive and enlightened on these issues from what I've been able to discern from the numerous forums and meetings that have been held in the area.
A quote from Shaun Dykes, exploration manager for CuMo, seems to portray the good-orderly-direction of the Mosquito mindset;
"We feel the Boise National Forest staff has done a commendable job reviewing the scope of the exploration work we have proposed and we look forward to a decision that will permit us to move ahead with additional exploration work."
It's all part of the "dance" in my view.
From my 2010 Best Idea list:
Mosquito Consolidated Gold Mines Limited
(TSX-V: V.MSQ) CD$0.89 - NASDAQ bulletin board: (OTC:MQCMF)
Market-cap of only $58 million Mosquito’s wholly owned Idaho-based CUMO deposit is thought to be the world’s largest still undeveloped molybdenum deposit (according to a London Times article reported by Dow Jones on 1/19/2010). Significantly, Mosquito completed the key public disclosure of information relating to mineral properties (called Ni 43-101) in Canada on Nov. 23, 2009. The disclosure states Mosquito holds confirmed resources of 4.13 billion lbs molybdenum oxide - 5.43 billion lbs of copper - 234.6 million ounces of silver – and 282.4 million lbs of tungsten. The molybdenum and other mineralizations are said to be worth perhaps as many as $80 billion. With a discounted present value is $16 billion (using a 40-year mine life at 150,000 tons per day) the CUMO mine appears to be able to produce for somewhat over 100-years. Also noteworthy, is that the "limits" of the mine have yet to be totally delineated - as only about 25% of the property has been core sampled and assayed. It’s colossal to put it mildly.
It should be noted that China-based INTERNATIONAL ENERGY AND MINERAL RESOURCES INVESTMENT COMPANY LIMITED and Ivy Mining, another China controlled company, have acquired about 21.01% ownership of (MSQ) in June 2009. I'm a believer that somewhere along the line a major player, either a major mining company or possibly an Asian company will take "another" major position in this drastically undervalued, world-class asset at a lot higher price.
See Press release 8/17/2010: “Mosquito is also continuing to negotiate with parties interested in partnering with Mosquito on funding the ongoing development of the CuMo project.”
I have purchased shares in Mosquito Consolidated Gold Mines on the open market.
For the complete list of my UPDATED Best Ideas for 2010 send an e-mail request to: Dr.Faessel@onthemar.com