FNX Mining Company FNX Does it Again A New Discovery in Sudbury

admin — Wed, 20 Jan 2010 18:21:48 +0000

FNX Mining Company (FNX) – $12.69 – FNX Does it Again: A New Discovery in Sudbury
Outperform, Above Average Risk
On January 19, 2010, FNX reported that recent drilling at the Victoria property on the southern edge of the Sudbury Basin has resulted in the discovery of three new zones of nickel, copper and precious metal mineralization. RBC CM thinks this is an important new discovery for FNX, yet states that it is still early and that given the limited amount of drilling, it is impossible to
determine the potential size of the mineralized zones. FNX will need to conduct additional drilling to better understand the size and scope of the new discovery. RBC CM has not attributed any value to this discovery until it receives a better indication of its potential size. All three mineralized zones occur in a typical Sudbury Basin offset dyke environment. The offset type deposits are very attractive exploration targets when compared to contact nickel deposits as they typically have higher Ni/Cu ratios and much higher precious metals content – the drill results confirm that the Victoria offset mineralization has these characteristics. Based on the exploration results, the in-situ value per ton of ~US$500 using spot metal prices is much higher than that of the McCreedy West and Levack Contact reserves (~US$250/t and ~US$295/t). If future drill results continue to provide the same level of success, RBC CM thinks that the Victoria project will become a valuable part of the FNX portfolio. RBC CM estimates that if all goes well, this project could be brought into production in five years at the very earliest. The new discovery at Victoria provides FNX with its next potential mine for development. FNX has a proven record of building value through the drill bit at very low costs. RBC CM maintains its Outperform, Above Average Risk rating.

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FNX Mining Company FNX Does it Again A New Discovery in Sudbury