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Hope you are feeling better this morning Safety.
The topic you raised this week about break even has certainly given me some encouragement that we are getting there. Even if it is a few months/years late.
Superfly. The question was " “So keeping it simple then. How much Tungsten do we need each quarter to cover the interest on the loan?‘."
Yes, you have sort of answered the question but there is a cost in that production. So to actually have $1.8m in the bank to make the payment you must also add the cost of producing that product.
Earlier Wasp assumes a production cost of $100 per MTU. using your numbers that 130t (13000mtu) are required to cover the interest then you also have to ad $1.3m that it costs to produce it. $1.8m revenue would only put $500k in the bank.
You will need 3.6 times that amount to generate the necessary $1.8m. So using your number of 130t that would be 468t per quarter or an average of 156t per month.
I am not saying any of these numbers are correct but you cannot have revenue with no associated cost to produce the revenue
Such interest with 9 posts. Round and round. Not well so up late, but not really calculating. But I have taken gaviscon, which is not entirely calcium.
The question I answered was the one asked by wasp at 13.35 “So keeping it simple then. How much Tungsten do we need each quarter to cover the interest on the loan?‘.
I'm not confused at all Tounge.
Superflymo has not provided ANY costs of production in his calculation. He deals only with Debt servicing. How does that answer Wasps question ? Here is his answer
"$60m (debt) * 12%=$7.2m / 4 (quarters)= $1.8m per quarter
We only get paid for the WO3 content so: $1.8/66(est grade)*100= $2.7m ish
We only get paid 80% of the marker price so $2.7/80*100=$3.4m ish
So, $3.4m ish / $250 (est market price) = 13,636 mtu = 136.36 dmt (ish)
Hence 130-140 per quarter."
Where in that does it include ANY OPEX
Mining
Drill & Blast
Grade Control
Crushing & Screening
Pre-Concentration (Jigging)
Concentrator
Waste Haulage
Laboratory
Management & Administration
Royalty
I've copied those from the FID Toungue
READ IT https://wresources.com/wp-content/uploads/2017/09/WRES-Final-Investment-Decision-Report-FINAL.pdf
There is a lot of unknows , but if I had to put a rough figure, I would say they need to be producing around 140-150 tons per month to break even.
No to Superfly
Superflymo. You have not taken any cost of production into account. Only Interest on the capital.
I'll keep my 50p
L200. I assume that was to Wasp? I tried to not muck around with his figures too much and just highlight where they need to be adjusted.
No offence at least you tried, but you need to look at your figures again !
It makes me realise that yes we are struggling at the mo and I do not like the fact that the SP is where it is but...
If (can I underline that) we do come close to those kind of figures in Q2 the company and the SP should start to rise.
Thank you Superflymo.
I see the others won’t offer you a calculation however well done on collecting the 50p.
Hi Wasp/GUG,
Here's my workings:-
$60m (debt) * 12%=$7.2m / 4 (quarters)= $1.8m per quarter
We only get paid for the WO3 content so: $1.8/66(est grade)*100= $2.7m ish
We only get paid 80% of the marker price so $2.7/80*100=$3.4m ish
So, $3.4m ish / $250 (est market price) = 13,636 mtu = 136.36 dmt (ish)
Hence 130-140 per quarter.
50p bet that Superflymofo "doesn't find the time "
You're not Wasp. I've given you an explanation already. What part of that do you disagree with ?
"Lets take last quarter as an example. Production was 100t W. Loan interest is $1.8m (If it was paid) That equates to $18000 per ton. Lets then (wrongly) assume your cost base was $100 per mtu that is $10000 per ton, so even using your incorrect assumption of cost of production then you have $10000 (Production costs) + $18000 (Loan interest) A total of $28000 per ton that you are receiving $18000t in return.
On this basis every ton that is produced at this level of production is creating a loss of around $10k per ton. The reality is actually worse."
Thanks Superflymo. Some idea that I was on the right lines was good.
Wasp: - "So keeping it simple then. How much Tungsten do we need each quarter to cover the interest on the loan?"
I'm not sure of the relevance of this in isolation, especially that AFAIK WRES have not paid it.
I did calculate, pretty sure I’m correct, will post later if I get time.
Superflymo - "Per quarter" Not ever. Explain your calculation rather then picking a number out of the air
Per quarter
Wasp - "I never mentioned 100 tonnes anywhere" No, you didn't. 100t W was Q4 Production. I used the latest numbers we have for comparison.
Superflymfo - "It’s 130-140 dmt" Yes, something like that PER MONTH
Toungueston - "For comparison purposes with Wasp it makes sense but 33t of tin would make a significant difference to overall income for the quarter even though they missed their tin production numbers by some way."
Yes it would, but the post is "How much tungsten to break even" You cannot count Tin Income as revenue if you are using it as a "Tin credit" to lower the W production cost. You have only one or the other. Suggest you read the FID to see how they arrive at the cost per mtu.
Hi wasp,
It’s 130-140 dmt depending upon the grade and the price per mtu.
Cheers
I never mentioned 100 tonnes anywhere
So keeping it simple then. How much Tungsten do we need each quarter to cover the interest on the loan?
Sorry I missed a direct answer to your final question. The tin is reflected as "tin credit" in Wasps numbers to arrive at the $100mtu cost (Too low)