Roca Mines Inc.

Roca Mines will often respond to many of the frequently asked questions on this page. If you have a question or concern please e-mail us or use the Send A Message feature. Please note that management cannot always post every submission, or may edit the information for brevity or clarity.
  Q  Why did Roca recently decide to raise $10 million for expansion recently rather than use cashflow to expand on the MAX Mine?
  A  Some history. When we began fast-track construction at MAX in May 2006 we were confident that we would have been in a 'campaigned' production and cash flowing by early 2007. In reality we endured a record-setting rainfall and snowfall that makes 06/07 one of the worst winters in living memory in the region. Our construction delays are substantially related to those winter conditions and our fast-tracked approach. Fast-tracking a project has its own inherent risks of finding previously unknown challenges and we have been impacted by a combination of those things; both of which were largely out of our control and difficult to predict.

It should be noted that building anything in around a year-long construction period, especially a complete mine, is nothing short of a major accomplishment.

When it was clear that a startup delay was inevitable we embarked on expanding our mill capacity such that we would have the flexibility to mill more ore when we were in production. The key word here is 'flexibility'; flexibility to rapidly process as much as we can and continue with mine development. One of things that most people do not realize is that mines continue to grow, or be developed, as time goes by. That growth is intimately related to commodity prices and is a part of a mine development schedule; mines, especially underground mines, are in a state of perpetual development and production.

Our goal remains to produce 3 million lbs of contained molybdenum in 2007 and our mill capacity is aiming to achieve that. Our recent announcement should indicate to the reader that we intend to do more than that in 2008 and beyond.

As we near completion of the Phase I construction we are also aware of another situation that is not in our control; the price of molybdenum. Since the New Year began the company has received more calls and queries regarding purchase of its molybdenum concentrate than in the previous two years combined. That fact and the clearer confidence in the near-term price for molybdenum provided by research indicate to us that robust molybdenum prices will be with us for several years. A window of opportunity exists for MAX to be one of the first in production of a commodity with increasing demand. More than ever we need to maximize our opportunity to increase production rates and deliver more concentrate sooner.

When you couple those thoughts of increasing demand, near-term strength in price and opportunities to sell concentrates at high prices with the modest delays we have endured it should become clear why Management wanted to accelerate that expansion plan. Strong cash-flow will come from the initial Phase I mine in 2007; a much more valuable long-term mine will result from these expansion efforts. This is an opportunity and we are taking aggressive moves to maximize its value for all of our shareholders.
  Q  Do you have intend to list your shares on a US or other exchange?
  A  Roca doesn't have any immediate plans to list on a US or other foreign exchange however, the Company does have a US trading symbol which is ROCAF. A listing the Toronto Stock Exchange (TSE) will be applied for upon commencement of production at MAX.
  Q  How much molybdenum does Roca expect to produce?
  A  Roca's permit allows for the mining of up to 75,000 tonnes of material per year. During the first year of production the Company intends to complete back-to-back production runs which, given a diluted head grade of 1.7% MoS2, would result in the production of 3 million lbs. of molybdenum contained in concentrate.
  Q  What is Roca's estimated cash cost of production per tonne?
  A  Roca has estimated an initial operating cost for the MAX Mine of US$100/tonne which includes all mining, milling plus general & administrative (G&A) expenses. An engineering report by Hatch on MAX estimated operating costs to be US$71/tonne.
  Q  Why did Roca not need to complete a bankable feasibility study?
  A  Roca's management determined that the best way to proceed with MAX is to enter into a fast-track design/build for the mine. This common engineering approach is based on the knowledge that the existing underground workings have remained intact for 25 years and that the mill previously functioned well and that the site generally provides excellent building opportunities for foundations of structures and tailings management. To make the project bankable now would delay startup of PHASE I by up to a year and potentially cost a significant percentage of our planned capital cost. Roca believes that MAX a very robust and low-risk project based on standard industry and contracted costs which can produce significant cashflow from an initially small scale mine.

Engineering and development plans for expansion to PHASE II have commenced including additional underground development work and mill capacity expansion.
  Q  Does Roca have 100% title to the mine?
  A  There is a 2.5% NSR which can be reduced to 1% by way of a one-time payment of $2 million. This payment can be made at any time prior to or during production.
  Q  Has the Van Stone Mill be moved on site?
  A  All of the necessary components from the Van Stone Mill, required to re-assemble the mill and crusher facilities, have been moved to the MAX Mine site.

Re-assembly of the mill is ongoing with pictures from the MAX Mine site being updated regularly to the MAX Photos section of this website.
  Q  Has Roca pre-sold any of its moly concentrate?
  A  The Company has signed an agreement with Derek Raphael & Co.(DRC), a UK-based molybdenum dealer, whereby DRC has agreed to purchase 100% of Roca's MAX Molybdenum Mine concentrates through 2017.
  Q  Are you able to mine all year, or only spring to fall?
  A  The MAX mine will be able to operate year-round as there is good access, the deposit is underground and there is a very short distance from the access adit (portal) to the mill (150 metres). Additional planning has commenced to enhance the mineral extraction rates from the mine.
  Q  What are Roca's plans for expansion at MAX?
  A  Roca intends to begin the permitting process for an expanded scale mining operation at MAX upon commencement of production in 2007. Construction and development work will commence later this year in anticipation of expansion permitting.
  Q  Does the Company have any plans to explore for more minerals at MAX?
  A  The MAX deposit is open "at depth" and Roca intends to explore for further molybdenum mineralization in 2007. The Company has formed an Exploration Advisory Board(see Roca news release of Aug 17, 2006) of molybdenum porphyry experts who have visitied the MAX site, studied the geology and have help to prepare a strategic plan for further exploration, through drilling, beneath the known deposit at MAX.

There are a number of tungsten targets on the property which were sampled in the fall of 2006. Results of this sampling program along with historical results were reported by the Company in a Dec 12, 2006 news release. Future work programs, including possible drilling on the tungsten zones are planned for 2007.
  Q  What is the Company planning to do with the Foremore and Seagold projects in northwestern BC?
  A  Foremore remains an important advanced stage exploration asset for Roca. The Foremore project is adjacent to the property hosting NovaGold's (NG: TSX) Galore Creek copper-gold-silver project.

Most recently in 2005, Roca's geologists defined and examined numerous VMS (zinc-copper-lead) as well as gold-silver targets at Foremore. Further drill testing as part of an extensive exploration program at Foremore will occur in summer 2007.

Romios Gold (RG: TSX-V) is currently earning an option on Roca's Seagold property. The NW Zone of Romios' property, contiguous to Seagold, host known mineralization extending onto Seagold. Romios recently reported drill results from the NW Zone.