1. large unexpected drop in the moly price with a negative short term outlook
2 terrible execution at the mines resulting in massive cost increases as well as lower production. A flash point is the writedown of over a half billion dollars of the moly assets. This is real money
3 TCM bought Terrane (Mount Milligan) in 2010 for about $650m, some of which was paod for with $9 TCM shares. Capex ballooned to $1.55b from the originall $900m which led to a 52.25% sale of gold to Royal Gold at $435 as I recall. Including some interest costs the total cost of Mount Milligan is circa $2.5b
To make matters worse gold is about 52% of the Mount Milligan metals with copper being 48%. Soon Royal Gold will get cash flow of circa $120m (100.000 ounces of gold). Royal Gold will take away 50% to 60% of all profits for the life of mine. In other words, TCM has contributed something like $1.5b for its share (Royal Gold provided the rest) in return for 40% to 50% of profits from Mount Milligan. A $5 copper price would provide great profits but $1,600 gold and $3.50 copper will not enrich the company. Royal Gold chipped in circa 40% of initial capital but TCM will have to provide 100% of sustaining capital. They each share depletion equally.
Recent head winds mean that new setbacks will scare away even the most optimistic investors.
Key look-fors $16 moly and $5 copper. This may happen within a few years