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yv00 - you asked a simple enough question today but the answer is quite complicated and probably isnt entirely knowable as yet..
The PFS from 2014 had a table on page 199 containing the CAPEX spend for a 2300tpd plant. Its Table 20-19
http://condorgold.com/sites/default/files/technical_reports/Condor%20Gold%20La%20India%20Project%20NI43-101%20PFS%20%26%20PEAs%20Final%2021%20Dec%2014.pdf
The total estimated CAPEX was 109.9M with 7.6M contingency. But the "new" plant machinery cost component of that was around $41M. or 40% of the total spend. As thats the biggest hitter, MC is quite rightly trying to reduce those costs. He is trying to buy a 2nd hand 3500-4000TPD plant at around 30% of the cost of new I believe. So perhaps $15-20M. A 3500TPD plant could easily give 120kozpa. Possibly even carry us up to the 150-170koz mark if its high grade.
So I think you could see a total CAPEX scenario of around $50-60M for a plant easily capable of 120k oz pa.. say $15M for the plant and another $45M for the remaining capital costs. $7M of the PFS costs were for land acquisition but this has now been paid, so can come out of the topline CAPEX figure.
To be honest, though, as a few have said, its kind of splitting hairs - these are 2014 figures and will have changed since... But we need to keep in mind the bigger picture. Producing 120,000 oz of gold at 20000oz (and I think thats conservative) will give $150M cashflow before taxes. In the first couple of years, CNR probably wont pay any tax due to expenditure. So whether they have debt of $35 or 45 or 55 is a bit irrelevant. They can pay back debt from the first 1-2 years of profits.. In other words, the CAPEX spend is tiny compared to the resulting profits for 10 years of operations for at least $150M per year. Would you spend $60M to make $1.5 Billion ? I rather think so.
Again, the price of gold is whats going to matter here. The AIM market is so light on gold miners, that sentiment alone will carry this to highs that most cant imagine. Think COVID stocks in a pandemic. If gold hits 2500,3000 or even 5000 the rush to get into these stocks will be mind-blowing and cause parabolic rises.
regards
T123
Elise ,I bought around 40 p and now again buying sub 40 p but have been invested here for over 10 years and traded a number of times .Its been a long road and it took me a while to work out the best strategy to protect my investment .only buying here with profits from elsewhere ,not putting in new cash . Good luck to long term sitters . I will be here longterm unless the story gets too complicated but there are too many opportunities for quicker cash than cnr presently Tbh but keeping a fluctuating holding for long term .
Frenchie ,yes I know what you mean about being able to buy .The same goes for selling when a share is tanking .thats where limit sells and buys can be handy .
I don't think they make a mistake to be fair. We know news is due and if the news is transformational it will be almost impossible to buy back in. I know having been invested here a number of years that it can be almost impossible to buy shares when news hits, especially buying in volume.
Elise , I sold here at 47 and now re buying sub 40 p . 35 p is a possibility yet imo if the market turbulence returns ,which I suspect is quite possible . 20 per cent cheaper . Peeps make the mistake of thinking you have to keep piling in cash to increase their holding .
Interested to see how much of a lift the last 7 per cent land sales make . I look no further than 70 p here in presently ,which is ok from 35-40 p . Longterm is a different story .
What will it take to get the old lady to sell up? She's leading a right merry dance round us all.
yv00, don't think we really know yet. We're all guessing with old numbers from the PFS and off-hand comments from MC. The PFS was $120m for the big mill, but I think that was brand-new equipment and with a 10% contingency, and that was a few years ago now. pdp1000's post mentions $50m debt not $50m total expenditure. MC has said that we can get a finance package with 70% debt and the rest from other sources, equity presumably. So that makes a total of $71m, which is starting to get up there. It sounds like the mill can be somewhat modular, so we can start small and then add-on bits as we need them / have the cash.
The good news is that it sounds like negotiations on the mill purchase are quite advanced and MC has said he wants to put a deposit on the mill this year. Not so much of this year left, so not too long to wait. At that point, we should know a lot more about what we're going to get and what it will cost us.
A $50 million plant wont produce 120K oz. Isnt $50m for a 2nd hand plant with lower throughput?
Are we cheap? Yes, by every measure, anywhere in the world. Something has to give here.. This has been suppressed for too long. I disagree on the dividend returns but that’s about it. Money will be used to explore and drill La India to a 5Moz plus district. But everything else is spot on.
Read the valuations from John Cornford I posted earlier - these are professional, career mining analysts who are all saying the same things as us. That this share is seriously undervalued, underestimated etc.
Buying at 39p you are getting in at just above the recent placing price. You are even paying less than Jim Mellon the billionaire has paid to buy in the open market recently, who is a NED and knows as much as the CEO here.
It all comes down to this - do you believe that gold as a commodity will do well over the next couple of years? In a zero interest, hyper bond bubble, modern monetary theory, global simultaneous currency devaluation environment? Or has mankind finally invented something new after 5000 years.. ?
If gold hits 2500,3000,5000,10000 in the next few years, there will be such a rush into gold stocks it will be parabolic and unlike anything seen since 1980.
Regards
T123
Please let me know if I have got this wrong as these are "back of a fag packet" numbers.
We borrow $50m for the plant and equity dilution to say 200 million total shares in issuance (a number being mentioned)
We produce 120,000 oz of gold in year 1 of production selling at $1900 / oz
Our AISC is say $650
Profit $1,250 per oz...total $150million per year
Repay all $50m in year 1 (I know we won't)
Approx $80 mill after taxes = £60m. This could result in 30p dividend per share
Year 2 onwards no loan to repay so approx $120m after taxes = £90m. This could result 45p dividend and the same for years, 3,4,5,6 and 7 onwards
And remember MC believes we have a 5m oz resource.
I total accept not everything will be paid out in dividends but I believe it demonstrates how cheap we are.....