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Baja Mining ( A victim of the credit crunch

This morning Baja Mining ( bit the bullet, faced reality and announced to the world its 'Boleo' copper/cobalt mine in Mexico would be indefinitely delayed. Mine construction started last year but will now be halted until further notice. Here's a quote from today's PR:

"While project economics remain robust even at low metal prices, the impact of the current financial crisis on short term metal prices and hedging prices, coupled with an effective shutdown of the global bank syndication and equity markets, require Baja to revise its construction schedule."

Allow me to translate: contradicts itself on the metals prices issue; on the one hand the mine would be profitable at low prices, but on the other hand low metals prices are halting the project. That doesn't make any sense and can be discarded. This leaves us with the real reason for the stoppage, namely there isn't a bank willing to fund right now. And that's full square the credit crunch and how it's affecting the industry.

The stock sold off 20% or so on the news and stands at $0.22. That's a long way from the $2+ figures it was printing last year when I took a serious look at Boleo and liked what I saw even though capex costs had almost doubled on the deal. The moral of the story is that metal in the ground ain't worth squat unless you can get it out the ground. Junior mine investors have to remember that one.