Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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That is the legal accounting terminology defined in laymans terms. Thank you for sharing that insight.
HZM can and will control costs and cash out accordingly, keeping in mind the likely completion of and progress towards financing etc. I have no concerns on cash, well said AIM.
Essentially my point is I see cost ramping up to pre-build, though AIMtodeath very valid points on the money spent on exploration and PFS which we won't have this year. Maybe the two cancel out to produce a steady burn rate.
Sirs I stand duly correct but (and it is a but) my working assumption was that some of the pre-engineering actually involves procuring things (power lines, roads, maybe other things) which cost money. We can't know the cost of those things, and indeed it is what I believed the bulk of the $25m might go into those things, because we haven't really had an operational update on what has been achieved on the ground and what remains to be achieved. I also saw a gradual ramping up of the team to production so it is optimistic to assume a fixed salary cost - you can't start building a mine (unless you use entirely subcontractors?) on day 1 if you don't have a team ready on day - x weeks/months?
I'm very happy if we've got money to last 2 years but there must be some cost to getting the mine (or prospect) to pre-build. I don't have figures on that cost - so I assume it will consume some or all of the Orion money.
WOW, thanks to you too AIMtodeath. Learnt more today than I have in months.
Good posts chaps, appreciated.
Cash running out in a year, one of the best this morning. The accounts say different! Before I use any figures they have stated normal operating conditions they have enough cash for AT LEAST 1 year (this is standard practice to say to confirm you will not raise money in this financial year at least). They further said they had operating cash on a tightened budget to last 2 YEARS!.
So what are people badly speculating the cash position for? Secondly previous year spend is not a sign of future spend, if you actually looked at what was achieved in the year you could justify that spend and see those things are not happening this year.
6.5 Opening balance
-2.4 operating activities (base costs inc payroll)
-4.12 investing activities (Purchase of exploration and evaluation assets plus property, plant and equipment)
18.24 Orion (was 19m but cost 1.2m in fees)
18.22
-0.482 (exchange rate loss - a swing of 500k from previous year - swings and roundabouts, but cheaper to buy in Brazil now)
17.738 equals guess what circ our cash balance
So it has been easy to say 19m instead of 18m for Orion because you didn't consider fees, 0.5 swing in forex, could swing back again to a +ve next year. Consistent 4mill spent on - Purchase of exploration and evaluation assets plus property, plant and equipment..... Given were we are now do we have much to purchase this year? I would think not. In fact other than progressing the finance I don't see a list like last year of achievements that had to paid for (brackets this year)
Vermelho Pre-Feasibility Study - (FS put on hold until partners are sourced)
Significant new Nickel Resource at Serra do Tapa - (work stream ended for that)
Power Utilisation Permit Awarded for Araguaia - (still some engineering studies but on hold no doubt due to the virus)
CSR - (we will continue to spend a small amount on the locals)
High Purity Cobalt & Nickel Sulphate From Vermelho (no testing of ore now)
Positive Metallurgical Testwork For Vermelho (no met work happening now)
So overall some CSR continuing, some engineering for the power line access (can't imagine that is more than a few people under contract and well advanced), salary at 2.4m, not sure how much more investing we need to do in the projects, we have all rights and permits pretty much needed for now, biggest unknown is the development of the mine team but it is forward progression that we need to spend on regardless.
So total cash spent last year circ 7m, we know 2.4m is likely, but don't see the big purchases of exploration and evaluation asset costs given the work streams carried out last year and their conclusion. We already know the mine progression work will and must happen.
Worst case 7m well shoot me down if that does not go into 17.6m at least 2 times! Or 2 years.