The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
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Also Steve, I’m sure there is something to be said on the increase in the economic viability of new and current resources, based on historical copper prices and when current mines operating now, were first shown to be viable pre production.
Copper prices back in the late 90’s when Newcrest opened its initial open cut mine at Cadia hill, were sub $1. Well over 400% increase since then. Even taking into account inflation adjustment of about 75% increase it shows how rising copper prices will typically drive new exploration on new and or existing resources in general. Making the economic evaluation of Bushranger a lot more favourable to be very profitable now in the current or preferably, a more stable economic climate compared to when cadia was first financially modelled.
I know cadia is primarily a gold producer so not exactly a good comparison and did also not consider what the dollar was worth back then, but the metrics to compare then and now remain the same I would have thought.
Howezap - Yes, it is the value not the resource that really counts, and even then risk still needs to be factored in.
If the expected Life of Mine is 25, 50 or 100 years, the company has to consider whether they will be left in peace to just keep churning the dirt for all that time. If the resource is in a country with a risk of war, coups, nationalisation, earthquakes, erupting volcano's etc, then it may still be a far less attractive acquisition prospect that one with less value but without the risks.
This is one of the point people have been trying to make during the circular discussions with porvenireal. If Bushranger has millions of tonnes of Cu Eq, and it can be extracted at profit, then lots of Majors will want it because it is Australia, which is probably the safest jurisdiction in the world right now. IMHO, it would make it a banker and that's why I am invested here and not in the companies that porvenireal keeps suggesting. Each to their own strategy I guess.
Thanks for sharing that Andy very simple to understand. This comment at end epitomises how the potential economic viability will be shown through the financial model in light of RC’s orientation, sheer scale and being shallow to surface.
>>its the VALUE not the resource that really counts.<<
Agreed Steve and linking it to the hole 38 drill cross section in yesterday RNS we need to understand more about the vertical structures which they touched. Hopefully 39 will reveal more.
https://www.rns-pdf.londonstockexchange.com/rns/7617L_2-2022-5-17.pdf
Very intresting thread. I think this really highlights the value of a more horizontal porphyry, compared to the common vertical structure. Also the width of the deposit will make a major difference to the dead rock ratio. The same amount of copper, with the same grade, but in a vertical structure, would be worth far less.
Howezap
I came across this on Twitter this morning which discusses the economics of the muck shifting. You or others may find it of interest. There are several posts in the thread.
https://twitter.com/NeilRingdahl/status/1526444705734696961?s=20&t=hVaUwxE9i-ZbGbseQZeP6A
I know the title doesn’t sound very awe-inspiring or grandiose, but simply with the inclined orientation of both RC and now Ascot deposits, muck shifting is exactly what CB has said they will become if and when they go to production in the foreseeable.
Do wonder if in 20-30 years what the landscape will look like after the open pit mines have carved out two (at least) almighty long scars into it. Although, at present I think I may have an obsessive disorder, or just really bored! I am able to scroll out of my current location on Google earth and zoom straight to RC in NSW. Don’t worry if you can’t do it too! or have a life, just wait a few or 30 years and then try again. Got a feeling it will be a bit easier to spot.