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Curis Resources settles building dispute with Florence town council

Published: 13:19 03 Jun 2014 EDT

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Curis Resources (TSE:CUV) said Tuesday that the Florence town council has voted to settle a dispute over the company's occupancy of administrative buildings for its Florence copper project in Arizona.

"Florence Copper is pleased to bring these legal proceedings to a close," said executive VP and general counsel for the company, Rita Maguire. 

"We continue to look for meaningful ways to work cooperatively with the Town's leadership and to develop a productive long-term relationship that contributes to the economic health and viability of the community."

At a town meeting on Monday, the Florence council voted unanimously to settle its dispute with Curis' subsidiary, Florence Copper, over the occupancy of the adminstrative buildings at the site of Curis' future in-situ copper operation.

Curis filed a lawsuit after the town condemned its administrative offices and denied access to the site for alleged health and safety concerns. The town, through its insurance carrier, has agreed to pay Florence Copper $100,000 for damages arising from the 30-day lockout. 

Last month, Curis was rated a "buy" by Dundee Capital Markets' Joseph Gallucci, who cited the company's pure copper exposure and low up front capital and all-in costs at its Florence project in Arizona as reasons to invest in the copper developer.

Gallucci also gave the company a target price of $1.40 based on a 0.4 times multiple to Dundee's net asset value of $3.33 per share, with the analyst believing the multiple used is conservative. In a research report that initiated coverage on the company, the Dundee analyst highlighted that Curis's Florence project will produce "5-nines", which is an essentially pure copper cathode project. He also praised Curis's in-situ recovery method for the project, which is a low-cost mining method that has been used successfully - in its modern form - for over 50 years. 

Based on Curis's initial capex estimate for Florence of $274 million, and the project's projected final production rate, the property's capex intensity is $8,900 per tonne of copper, well below the average of $14,000 per tonne seen for global copper development projects, said the analyst.

Curis owns 100% of the Florence project, which has 340 million tonnes of reserves and 490 million tonnes of resources grading 0.35% copper, with over 73% of resources included in the reserves estimate. Once in production, the estimated mine life is roughly 20 years. 

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