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mvw. thanks for update. helps posters like me a lot. thanks
Very informative, Mvw1, but not really in keeping with the tone of this board sice last week.
What are you views, for instance, on Omicron?
And is Karl Marx's grave really a Communist plot?
Mvw1,
Thanks for your informative posts, like all here have said it’s much appreciated
Atb
Post of the day and its only 10.00...cheers mwv
Hi mwv1, genuine question ..... what are your thoughts on Solgold getting to production/sale etc. I find your posts very interesting indeed!
Mwv. Thanks for your efforts.
It’s always appreciated when you post these reasoned breakdowns. A refreshing change.
@mwv1, keep it coming, I love your posts!
Porvenir
I expect we will get a MRE this year as planned. It will probably be of a similar size to that for Tandayama – approx. 400mT of resource but a higher overall grade around 0.6%+ compared to 0.4%. Again, split into 2, half accessible via open pit and half an underground resource. It’s ok but nothing too special. The accessible higher grade core will make it economic at $3.3 Cu but not hugely valuable.
Since July they have expanded the drill count from 2 to 3 but 2 of those rigs are now drilling new prospects. Suggests that the July sizing hasn’t changed too much.
Porvenir doesn’t have some of Alpala’s advantages – it is in the middle of nowhere and on the boundary of a national park not a national highway. Road to get to it is small with numerous river crossings. There is no local power grid and no sizeable local workforce. It will take longer to develop than an open pit at Cascabel and will require more infrastructure spend.
The pretty pictures in the Porvenir RNS in July give us a first estimate of the resources at Cacharposa.
The relatively accessible higher grade section looks like it’s about 700m long, 400m deep and 100m wide – up to a max of 80mT (probably 50mT) at about 0.8% Cu eq (0.7% cutoff and not much above 1%).
This is surrounded by a halo of maybe of 200mT at about 0.4% cu eq. The size and grade will be improved if you can get at the higher grade resource located deeper underground and mix with the halo - in 7 to 10 years’ time.
For an open pit and extraction plant at 10mT/y you are looking at in the order of $0.7 to 1b capital cost and get a mine life of over 20 years.
This gives pay back at current copper price ($4.25/lb) of 2 years ($350 to $500m profit/y at higher grade before taxes etc), extending to 3 years at ($3.3/lb- expect long term price for PFS).
400mT at 0.6% Cu eq and 90% recovery is worth ~$20 billion at today’s prices in the ground.
Porphyries tend to turn up in clusters (look at Alpala) so the excitement will come if either of the 2 drills testing new targets hits something. Cacharposa isn’t necessarily the biggest deposit if there is a cluster.
Feck......you know your stuff mwv1. Another great post. Don't forget it would take 2.5 to 3 yrs to pay back the setting up costs @ TAM processing plant and Open Pit but after that....money in the bank. If Solg gets permission from the government to dig a fecking big hole @ surface level at TAM and Alpala, then this could be a goer. The former would run into the latter from an income perspective. The other benefit of all this is that with only 3000m between the two prospects, the processing plant could easily service TAM and Cascabel with long term savings.
Having re-read the MMRE, other good news reveals that Solg are making TAM an integral feature of the Cascabel tenement. I would expect therefore that Alpala and TAM will feature as one entity in the PFS. The former acting as a feeder mine for the Alpala project.
Another obs: the resource @ TAM is open to the south (and at depth) which means it is pointing / leading towards Alpala..............will they join up eventually??
Grades at depth need to be much richer if this (TAM) is to develop into a BUM (bulk Undergroumd Mine).
Z
Slug Omicron isn’t necessarily a runny nose. South Africa - its first detected location, has experienced the full range of symptoms with some patients having serious problems / hospitalised. Nobody yet knows how it’s going to play out.
thanks rich. as i say must of missed it. be nice if it happened. never say never
@mwv1 (acronym of Mather Wants Value?), that's interesting analysis and different from the usual comments here, are you a geologist?
Harry 2024 was mentioned re possible production a couple of days ago in an article/link posted by someone here. I genuinely can’t remember who posted it or what the article was - anyone else recall ?
Looked at the numbers in a bit more detail.
The reality is that the first ore processing plant will be much smaller 2.5 to 5 mT/y. This will be fed from a mixture of a surface pit at Tandayama, a surface pit at Alpala, and a vertical shaft at Alpala to higher grade material.
MRE 3 for Alpala shows a small surface resource (no figures for size and grade) but small high grade zone shown near surface. Tandayama MRE 1 gives 10mt at 0.4%. Vertical shaft will have limited capacity. All together could feed up to a 5 mtpy plant for 5-7 years whilst Alpala block cave mine is built. Small plant and surface pits could be on-line in less than 3 years.
If the mixed feed is around 0.8 to 1% Cu eq the concentrate produced would be around 300 tpd and so could be trucked to port. Removes the long lead & high cost pipeline.
Overall up front cost of say $500m ($250m for processing plant +$250m for open pits / shaft / infrastructure) and would throw off cash before tax of $200-250m.
This would be enough to fund most of the equity side for building the block cave at Alpala ($500m a year for 5-6 years).
On this basis a fund raise for $200-250m with the rest as debt for the first plant could largely fund the full size mine (alongside further debt).
rich. i wonder if you could share with me the evidence youve seen to say we could be in production in 3 years. i must have missed that one.
Hi Dan I totally agree re the bid - it’s what the market wants imv. Production in 3+ years doesn’t really set the pulse racing today.
And I’m afraid that the markets are going to remain jittery with peeps reducing exposure, until we know whether current vaccines deal with Omicron. The next 2 or 3 weeks probably aren’t going to feel very Christmassy at all :-/. Can the new CEO pull something out of the bag???
Sometimes I think the only thing that will get this moving is the first bid . There is a huge disconnect between price and value here …… and the likes of Black Rock ****ing about doesn’t help
"Not that great compared to Alpala" - no sh*t Sherlock. It was never going to be.
Who's in for a quick trade at this price?
Not a chance in hell happyharry… just venting as this is the solg bb believe it or not
Well at this point the silence from the new CEO Is deafening and looks like BHP have the trump card in hand …. Exactly where they wanted it
novice, if you feel like that why linger. sell up and move on. take your own advice
WTF is it with this stock does nobody want it ??? Today is the most trying day ever and am so close to the point of saying enough is enough!!!! Even after a resource increasing RNS this morning
Mwv1 - best post thus far. Black and white economic argument for Tandy being a starter mine for alpala.
Z
So, 0.19 Cu eq break even grade for open pit at $3.3 per lb - equates to rock with a value of approx. $12.5 a tonne (assumes 90% recovery) for break even. Open pit resource is approx. double this grade on average, so would have a profit margin (before tax, other overheads, royalties, etc.) of $12.5/T. Large processing plant (i.e. half size of new proposal for Alpala) would be 15mTpa. This would give them about $180 before tax etc - call it $100m per year after tax. Cost to install plant plus transport infrastructure to port and all the rest approx $1b. So would just about wash it's face and would take $1b off the cost to build Alpala.
Sort of works but it is not compelling. If they can access higher grade material earlier, i.e. over 1.5% Cu eq the maths change dramatically, with the same size plant producing profit before tax etc. of $1b plus not $180m and suddenly it can finance Alpala without further cash raises.
All depends on the plan to drive a vertical shaft into Alpala core for early access.