Member Info for corradus

I'm with you on that Cobrakai.
Don't quite understand why we should be in a rush to sell 25% Hav off the back of an initial MRE. I would have thought 5% at FMV will give the required cash going forward if needed for SW (or borrowing if needed) and then sell Hav after MRE revisions (IMO upwards) subject to having a better idea of the SW prospect... ie it looks good.
I know explorers take risks, but surely Hav means we can afford to be a little more cautious before divesting it.
Personally I'm confident that at least one of the other prospects will be viable... just need to make sure that whatever happens re Hav the finances to find and sufficiently develop it are available IMO.

The only concern I'd have about a sale of Hav to NCM would be its timing. Personally I'd like to see a bit more positive news (drilling) on some of the other prospects before that happened... but maybe I'm being overly cautious?

Hi MKumar
Doing it the way I did it - due to lack of Bed&ISA - I ended up avoiding losses (small granted) due to spread and trading charges. After buying in ISA my plan was to then wait and sell same number of shares when buy price (per share) plus costs (pro rate per share) in ISA fully covered by sell price. Only thing is I still haven't sold the shares outside of the ISA...

I had the same issue with HL and was informed that bed and isa had been withdrawn due to coronavirus...
I was fortunate enough to have funds available to buy GGP shares into my ISA with a view to then sell those outside once the price had moved up (a risk granted, but was confident).
It then did... but still waiting to sell...

For info HL charges:
0 - 9 deals £11.95
10 -19 deals £8.95
20 or more deals £5.95

Hi All.
I've finally got hold of the H&P pdf! :0)
A few things puzzling me. They quote end of mine life as 2032. In the Havieron model key parameters they say LoM Au prod 3485 koz and LoM tonnes mined 21,150 kt, but in the table immediately below they then give figures from 2021 to 2032 inclusive. But the figures don't tally. There looks to be a year missing from the table, ie. 2033. E.g. tonnes mined per year is 1 at 0t, 1 at 150kt, 1 at 1Mt (50%) and then 9 at 2Mt (100%) giving total 19.15Mt. Similarly for the gold. I thought it might just be the pdf missing the column, but elsewhere in the doc it says "until the end of the mine life in 2032." Is there a way to confirm the key parameters were used in the valuation (I'm sure they were but just wondered how to check)?
I also can't get the copper figures to come out. I'm getting about 10.2ktpa not the 9.2ktpa. Probably me but I can't see why (0.6%, 85% recovery, 2Mt and ???).
The FCF figure for 2025 in the table looks "odd"...?
And a slightly naive question - why is the ore body grade 6.7g/t and the head grade 5.68g/t ?
Thanks for any help/clarification.
C

Thanks mineralholder. Appreciate that.

Hi.
I've registered, but am still waiting to get access to the site. Please would somebody be kind enough to provide the following data if it was published, in arriving at their 12.9p SP estimate:
Price of gold and copper used
Recoverabilty rates for gold and copper
Discount rate factor used in NPV analysis

Struggling with getting to grips with their figures and the less gaps I have the better!

The following H&P figures are puzzling to me and if anyone can help me out I'd be grateful:
"Of the US$1.67bn valuation, Hannam attributes US$540.8mln to Greatland" - 1.67 * 0.3 = 0.501?

"We model a 12-year, two million tonnes per year operation" - 12yr * 2Mtpa = 24Mt
But
"we have estimated a mineral inventory in the high-grade sulphide zone of 4.4mln ounces grading 6.7 grams per tonne" - 4.4mln x 31.1034768 / 6.7 = 20.4Mt
Why the difference of ~4Mt?

"Our annual steady state production estimate is 330,000 ounces per year of gold" - 2Mtpa x 6.7 / 31.1034768 = 430,820oz pa => 330/ 430.82 = 0.76 (possible I guess - low?)

12 yr @ 2Mtpa? - From Newcrest "TECHNICAL REPORT ON THE TELFER PROPERTY IN WESTERN AUSTRALIA AUSTRALIA " March 2014 (good read)
"The original design production capacity of the redeveloped open pit production was 17Mtpa with an additional 4Mtpa scheduled for production from underground mining. The feasibility study recognized that the mining rate could achieve in excess of 18Mtpa when softer ore was being mined. Since commissioning, the production from underground operations has increased to approximately 6Mtpa..." so 2Mtpa maybe low?

Thanks
GLA
C

Hi Schlemiel.
Interesting read. I find it amazing how tech and innovation is improving the ability and efficiency to mine, and Newcrest appear to be at the forefront of this...
This is about the right level of explanation for me...
https://www.youtube.com/watch?v=ePgCZ583Og4
C

Hi Magic.
Thank you for the quick reply. Appreciated, and I will be revisiting the calcs at some point. I was perusing some articles re: mining cost and there is some interesting info regarding the cheaper cost of bulk mining disseminated ore bodies compared to vein/reef style (stoping I guess?). It's all mostly over my head, but here's the link and perhaps you might be willing take a look when you have some free time and perhaps see how if it might relate to GGP?
Cheers C

https://www.researchgate.net/publication/319058774_Understanding_the_Sustainability_of_the_Australian_Gold_Industry_Where_does_Geoscience_meet_Mineral_Economics

If the link gets removed have a Google for:
Understanding the Sustainability of the Australian Gold Industry Where does Geoscience meet Mineral Economics

Hi All.
I have confused myself with some of the figures I have and would appreciate any help / pointers.
I'm sure I read estimated dimensions of the HG ore body - unofficial estimate (thanks Paddy I believe) - as being 60,000m² by 900m depth. Is that correct or have I got my wires crossed? Did this include breccia as well as sulphide zone, and Hannam have used solely the latter?
Also puzzled by Hannam figure of 2Mt per year (interestingly the upper end of SB quote) over 12 years. I assume 2Mt is the amount of ore processed pa that they are basing their 4.4Moz estimate on. The gold and copper work out from that with around 77% recovery I think... similar to what they had at Telfer March 2020 qtr. What I don't understand is why that throughput figure of 2Mt - that seems quite low (to me)? They treated 771,000 tonnes in the March qtr ~ 3Mtpa from the Telfer underground mine. What sort of figure would be realistic for ore mined Mtpa for mine at Hav, taking into account mining limitations (if relevant?) and also that NCM will presumably be mixing it with the ore mined at Telfer.
I guess when SB was talking about 10x grades at Telfer he was referring to the open pit grade at around 0.75g/t (which is around what Hannam have used) rather than anything else, ie. average or underground grades.
Thanks in advance.
C

Thank you for the kind words. I hope to revisit the AISC calc assumptions at some point, but removing all credits & leaving all debits I believe gives a worst case for now. I will re-calculate as new data comes along.
I've calculated GGP percentage at 30% btw.
tom_the_bomb - the share price using the parameters as before is 30.59p at $1700.
GLA
C

Thanks for all the comments re figures used for NPV model. Appreciated and helps to get a more realistic minimum figure.

Copper price - I've decided to lower this as both Goldman Sachs and Citi lowered their 3 month price targets in March 2020 to $4900 and $5000 respectively (GS down from $5900). I'm going to use $4800/t.

Gold price - good point about NCM ore and resource prices. I'll produce figures for a range of prices, including these.

Au Moz - not a direct feed into the calcs as ore tonnage, AU/Cu grades and throughput used, but it is calculated so I'll list it.

Recoverabilty - I have used 85% as the recoverabilty for both Au and Cu (working from NCM March 2029 qtr for Telfer - used underground recovery figure for gold).

Shares - Good spot! Yes I'd included the Pacific Trends figure twice... So the correct figure is 3670891766 (in issue) + 132155405 (remaining warrants) + 259500000 (options) + 145530000 (shares to Pacific Trends if mine developed. Did wonder if this is due if Hav is sold to NCM pre-mine. I would assume not?). This gives a correct total of 4, 208, 077, 171.

AU grade - I used 2.5g/t based on the fact that the March 2020 qtr figure for Telfer was only 0.97g/t, and given SB comments re 10x grades I don't believe 2.5g/t is unreasonable...

Specific gravity - although not commented on I have revised this up from 2.9 to 3.0 as I revisited a Mining Maven (Elephant in the room) article where they state that 3 is "broadly expected in the regional geography".

I have little idea of the discount to NPV NCM might receive on a sale or what the tax implications and impact would be on any sale. Maybe others may have a better insight into this?

So what does this all do to the figures? With all other parameters being the same (copper grade, throughput, mine lead time, mine life, NPV discount rate, etc.) this gives:

Au Deposit size 13Moz
AISC $995 / oz sold (excluding by-product credits, and see below)

Au ($/oz) - Share price (p)
1000 - 7.86
1200 - 13.62
1250 - 15.06
1300 - 16.50
1500 - 22.25
1750 - 29.45
2000 - 36.65

The AISC $/oz sold was calculated using NCM March 2020 qtr "Net Cash Costs" base figure ($1016), and then removing ALL credits including by-product credits (which I calculate separately and then add-in later), leaving ALL debits unchanged, assuming no inventory movement, and finally adjusting mining/milling cost based on ratio of assumed new grade to old (current) grade at 0.97g/t (the basis is that mining/milling low grade ore is pretty much the same cost per tonne as mining/milling high grade ore...)

I am hoping these are worst case figures (if not let me know and I'll change them...)... an increase in gold grade to 3g/t adds more than 25% to share price, an increase of one third to the ore body size adds 16% to the share price, an increase of one third to the copper grade adds just under 20% to the share price... Lots of scope for improvement.

Ran some numbers through NPV model - ore body 156MT, throughput 15.5MT pa, grades Au 2.5g/t, 0.45% Cu, discount rate 9%, Au $1750, Cu $5000, 11 yr mine life, 4 yr mine lead time, Au & Cu recovery at 0.85%, AISC $996 / oz prod (excluding by-product credits, ignoring all other credits), shares 4,353,607,171 (incl warrants, options, shares to Pacific Trends), 1.25 $>£

Got 28p per share for 30% Hav, but was after comments on Au/Cu grades, ore body size used etc. I'm still working off 60,000m² x 900m depth - is that still good or bigger now? Is Telfer throughput at 15.5Mtpa too low?

Thanks and GLA.
C

Magic
Good post and things looking...golden. Not sure if the 20MT was tonnes or tons, but if the former then figures are better as only need to convert to troy oz from g - divide by 31.1 I think... not that it makes a huge difference... around 10%.

You mentioned the AISC. For March 2020 qtr that was $1160/oz sold at Telfer which includes the copper credits. Majority of AISC is mining/milling costs so if you assume 5 g/t grade then that's about 5x higher than current March 2020 at 0.97 g/t. So mine/mill 80% less ore to produce same gold...or another way, process (mine/mill) same amount of ore to produce 5 times more gold. AISC a lot lower for each oz gold produced. Copper credits are important, but current grade (March 2020) was only 0.17% so anything around 0.6% isn't going to change things much (if copper grades were also 5 times higher - c. 0.85% - then credits remain the same for that 80% less ore processed to get same gold).
Hope that makes some sort of sense.
I've ignored inventory movements, and have assumed gold produced is sold.
These are my own interpretations of the figures, but hopefully I've not made any mis-steps.
GLA
C

Hi Paddy
...10 times better than what they're treating at Telfer now...
Agreed. Quite a statement. Even if you assume a lower multiple than 10 that's still great news - the head grades at Telfer were 0.97 g/t for March 2020 qtr and 0.93 g/t FY 2020 YTD...!

If nobody got in the Q&A will be quite short...

It would be nice to know if just one person managed to get on....!!

Hope so. Doesn't create a great impression if not...

There was to be a Q & A session too... :0(