The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
Again I would agree with you,there had to be an exit strategy from Manica due to the volatlty of income due to weather,location,ground conditions ect.
However having paid $12 m for the resource would you say that was a fair return on the investment.
The spread of payments over an extended period of time that are not guaranteed makes the future uncertain.
This share now is a gamble on Zambia. I am reminded of a quote “the definition of a mine is 'a hole in the ground with a liar standing next to it.'” sorry that should be 'ole.
I don't think it's right to make a comparison with GGP the RNS it raises expectations.
The fact is Haiveron is 600m below surface block mining at huge expense.
2km of mineralisation at a shallow depth can be commercial.
Will Newcrest stump for a drilling campaign or will there be further dilution.
The Aitik mine was referenced today as a model for a profitable high tonnage low grade 0.2% ore
open pit mine.
https://copperalliance.org/resource/peak-performance-bolidens-aitik-mine-teams-with-metso-to-boost-production/
https://www.ericsson.com/en/blog/2022/3/private-networks-enable-automation-at-the-boliden-aitik-mine
*** packet out
512mt at .22% = 1.1264 mt copper equiv
191mt at .33%=630,0000 t copper equiv
A capx of of 1bn $ processing costs of 3$ -6$ per kg $8000/t copper
1.1264 mt at 90% recovery is say 1mt
Total value of contained copper equiv is $8bn
From the above we have more than half the contained copper in the higher grade core.
Taking not account 90% recovery we have 567,000t with a value of $4.536bn
Weighting the capx on he higher grade say $1bn we have a value of $3.536bn for half the mine to balance the books on lesser grades.
The production costs can vary but take the average $4.5/kg we have a cost per tonne of $4500
I note colin mentioned the mine in Sweden which I believe is fully automated so production costs could come down considerably
that would give a profit of $3500 per tonne copper
Going back we have 567,000 contained copper with a $3500 /t profit equivalent of $1.985bn profit for half
the mine.
I could go on with lower grades but my point is that there is a feasable mine no one has a crystal ball and predict prices but with fixed capex and production costs any incease in poc puts multiples on the bottom
line.
As you can see anyone can come with what they want by manipulating data.
I stand to be corrected on the above and put out for discussion.
At the bottom of the article John Cornford gives an update on his current veiw of extract.
Just waiting like the rest of us.
https://masterinvestor.co.uk/commodities/does-lithium-offer-hope-in-a-tough-mining-climate/