RE: SP predictions April next year?2 Apr 2022 13:30
Here's my 2 penneth worth
Take Ka****u
500k tons approx 25% Zinc
50m tons At 2-5% zinc
Option A
Current plan to pay 3rd party to mine on our behalf and sell rock. 500k tons At 25% zinc is comparable to SZ maybe 100k bigger (Sz had 72k tons of contained copper), and when it was our plan to pay a 3rd party to mine this for us, the earning would give us $60m over 5 years at zinc price of $2500....which it was about 3 years ago.
So straight away that's an estimate of $60m. Just for interest I believe it was the sniff of this that saw us jump to about 2.6p......
Then there's the 50mt at 2-5%. S0 bottom end, 1mt of contained copper.......tbh no idea how to scale this up due to low concentration. But say our target of $100mcap to get our emotive 10p ish sp. Then $60m from the small pit and then the remaining 50m tons At 2-5% would have to be worth $40m, which seems plausible.
Even more simplistic, CB in an interview said Kash was 5 times bigger than SZ (MM quoted 8, it may be, but let's be reserved in this instance). SZ $60m over 5 years, therefore Ka****u $300m over 5 years.
Option B
Sell on like we did SZ and gain a royalty. Sale price 5 times more so $2.5m....maybe
Small pit
500k tons 25% zinc using SZ royalty formula (price of zinc $4200)
4200x0.25x0.09x500000 = $47m
Remainder ( 50m tons at 2-5% assume 3% concentration)
4200x0.03x0.09x50000000 = $567m
If I'm honest now iv got to the bottom of this post and calculated that, I didn't think it would be so high.
But anyway total in Royalties $47m + $567m = $614m
I doubt we will get anything close to either option A or option B numbers
But even at a small percentage of them that's still a h*ll of a lot of money and multiples of today's MCAp of $11m
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