"The history of Eureka lies in its future." - Lambert Molinelli, 1878


The author/editor of the Eureka Miner owns common shares of local mining stocks, General Moly (GMO) and Newmont Mining (NEM); together with benchmark miner Freeport-McMoRan (FCX). Please do your own research, markets can turn on you faster than a feral cat.

Thursday, March 25, 2010

Hanlong Invests in Another Moly Miner

Morning Miners!

It is 5:58 AM. Grab a cup of Thor's java and let's see what's up down under. Reuters reports today that China's Hanlong Mining Investment plans to invest $200 million in
Australian base-minerals explorer Moly Mines Ltd (MOL.AX, MOL.TO) this April. Hanlong is working with Chinese banks to secure a $500 million loan for Moly Mine's Spinifex Ridge Molybdenum project. The equity-and-debt investment will make Hanlong a major shareholder in Moly Mines. Here's the link to the Reuters article:

Hanlong Mining to invest $200m in Moly Mines in April (Mineweb - Reuters, 3/25/2010)

Is this the same Hanlong that plans to fund our Mt. Hope project as announced earlier this month? (General Moly Announces Significant Investment from Hanlong, Stock Surges) We need to look at the Hanlong corporate structure to understand a "yes" answer to this question:

Sichuan Hanlong Group Ltd. (established in 1997) is based in Sichuan Province, China. The investment group is engaged in minerals, properties, tourism and media.

Hanlong (USA) Mining Investment Inc, who now has an interest in General Moly's Mt. Hope, is a unit of the privately held Sichuan Hanlong Group Ltd.

Hanlong Mining Investment Pty Limited, who will soon have an interest in Moly Mines, is an Australian subsidiary of the same Sichuan Hanlong Group Ltd.

I can't help but think this is a another bullish sign for molybdenum miners. As Scotia Capital analyst Lawrence Smith told Mining Weekly after the General Moly transaction:

"China, the world's largest molybdenum producer, has seen a surge in demand for the stainless steel material in last five years, mainly due to its infrastructure development program. The country now is the biggest molybdenum consumer...In my view, demand is going to grow relatively high in the next decade and I am sure Hanlong is looking at this as a very long term investment." (to view the full Mining Weekly article, click here)

Mr. Smith also had some kind words to say about the General Moly deal:

"It appears to be very high quality project in terms of the reserve base and cost structure, and will be significant in the molybdenum market going forward."

So there, pardner, Miss Moly has a bright future and we'll share part of it right here in Eureka County. You can check out some more about Moly Mines on their website. They have some cool photographs of mining in the "Outback":

Moly Mines Ltd.

Pour Miss Moly a cup of joe and let's walk the walk:

4-WD is OFF - the VIX or "fear index" is below 25, smoother broader markets are expected; metals & miners are recovering today with FCX comfortably above $74 (what is this?)

The YELLOW light is switched back on our fuel gauge with oil above $80

An ORANGE light is ON for possible adverse regulation/legislation: Miner's claim fee, Miner taxation, Cortez Hills & mercury emissions

Otherwise, all lights are green on the Eureka Outlook Dashboard (upper right, what's this?)

NYMEX/COMEX: Oil is up $0.18 in early trading to $80.79 (May contract, most active); Gold is up $1.2 to $1090.0 (April contract, most active); Silver is up $0.094 to $16.735 (May contract); Copper is up $0.0135 to $3.3590 (May contract); Western Molybdenum Oxide sits at $16.25, LME 3-month seller's contract is $18.14, the 15-month seller's contract is also $18.14

The DOW is up 64.39 points to 10900.54; the S&P 500 is up 7.46 to 1175.18. The miners are happy today:

Barrick (ABX) $37.38 up 0.38%
Newmont (NEM) $49.72 up 0.01%
US Gold UXG) $2.74 up 0.74%
General Moly (Eureka Moly, LLC) (GMO) $3.47 up 2.97%
Thompson Creek (TC) $13.52 unchanged
Freeport-McMoRan (FCX) $80.o8 up 0.36% (a bellwether mining stock spanning copper, gols & molybdenum)

The Steels are mixed, (a "tell" for General Moly & Thompson Creek):

ArcelorMittal (MT) $44.09 up 4.13% - global steel producer
POSCO (PKX) $116.25 down 0.47% - South Korean integrated steel producer

The Eureka Miner's Grubstake Portfolio is is up 0.97% to $1,342,050.59 (what's this?).


Colonel Possum

Headline photograph by Mariana Titus

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