Optionality4 Apr 2026 21:35
Hi guys I have a word for you… optionality… it is a word used a lot by Jason Reid at Fortitude Gold, more about him some other time.
The chat here has been about what will happen with the Runruno Plant, extension drilling, other MTL Nicaraguan land assets and similarities with Equinox, who have plant and spoke operations in the vicinity of the new La India mine complex. Opportunities for MTL in Nicaragua abound.
Optionality in business refers to the strategic ability to adapt to changing conditions by maintaining multiple paths forward, rather than committing to a single, inflexible plan. Nick Candy is big on optionality and I presume Darren and his team are also. Nick has taken some flack in the British press for meeting with representatives from the Nicaraguan government recently. He knowingly did this to get a deal… but not what some in the British press have been writing about… it was to get MTL optionality.
Large projects need infrastructure and the major outstanding element , which was outside of their control for La India, is power. This is controlled by the government and we here were worried about the power line being built on time to meet the Q4 deadline for production. I’ve written recently about the program and changes to the overall project progress which has been revised but without much explanation… this I believe is due to the electrical work a securing some optionality.
La India, as designed, needs a 34.5kV substation. However the supply line substation to be built is a whopping 138kV.
Now what could this be used for?
Reread the latest RNS (key part copied below).
Electrical Infrastructure - The Company has agreed a collaborative arrangement with ENATREL, Nicaragua's national electricity transmission company, to construct the 138 kilovolt ("kV") substation at a total cost of US$6.2 million, representing a saving of US$6.2 million against ENATREL's turnkey proposal of US$12.4 million. Under the agreed structure, ENATREL will be responsible for engineering, design, equipment supply and commissioning of the 138kV substation and transmission line, with the Company undertaking civil works and electromechanical assembly. The total revised electrical infrastructure budget, inclusive of the La India 34.5kV substation (US$1.6 million) and processing plant switch-rooms (US$4.0 million), is US$11.8 million, an increase of US$5.6 million against the original budget, contributing to the revised total Project CAPEX of US$171 million.
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