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Mount Hope moly project financing ‘within 6 months’

Keywords: Tags  General Moly, Bruce Hansen, Jefferies, Mount Hope, molybdenum, China Development Bank, Sichuan Hanlong (Group), Liu Han Thompson Creek Metals


NEW YORK — General Moly Inc. is aiming to put together a "full finance package" for its Mount Hope molybdenum mine in Nevada "within the next six months or so," according to chief executive officer Bruce Hansen.

The Lakewood, Colo.-based company needs about $800 million in financing to build the $1.27-billion project, according to Hansen, after a loan deal with China Development Bank collapsed due to the detainment of Sichuan Hanlong (Group) Co. Ltd.’s chairman, Liu Han (amm.com, May 16). Hanlong was arranging the loan.

"We’re currently looking at new strategic partners within China to replace Hanlong; at the same time, we’re also looking at Western finance solutions as well," Hansen told Jefferies & Co. Inc.’s Global Industrial and Aerospace and Defense Conference in New York, adding that due diligence is ongoing "with a number of parties."

The company has retained London-based Cutfield Freeman & Co. Ltd. to help in the finance search, according to Hansen. Construction of the mine will take between 20 and 24 months once financing is arranged.

The company has updated the economics for Mount Hope, with cash costs now expected to be $6 to $7 per pound from a previously published estimate of $5.30 per pound, Hansen said.

Hansen dismissed the possibility raised by an audience member of General Moly buying Denver-based Thompson Creek Metals Co. Inc.’s molybdenum assets. "Trading our paper for those assets at this point in time probably doesn’t make sense," he said, although "there may be something down the road that makes sense."

Thompson Creek suspended stripping activity at its namesake molybdenum mine in Idaho late last year (amm.com, Oct. 3) and also has been hit with challenges at its Endako molybdenum mine in British Columbia (amm.com, Feb. 25).

"Unless they (Thompson Creek) see over $12-, $13-per-pound molybdenum prices, they’ll put Thompson Creek on care and maintenance," Hansen said, adding that "Endako is not generating cash at these (price) levels."

While Thompson Creek is facing challenges at its molybdenum projects, the company has diversified into copper, with the start-up of its Mount Milligan copper-gold mine in British Columbia imminent (amm.com, Aug. 8).


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