shadowless24 Nov 2020 19:18
nice read couple bits stand out initially
Once its TEO is completed towards the end of 2020, Amur will then have the opportunity to upload the results into a western-style bankable feasibility study (BFS) (should it be necessary) and based on the source of project financing. On current company estimates, this will take one more year (ie projected for conclusion in late 2021).
SHOULD IT BE NECESSARY
Other opportunities
In addition to the potential to generate a separate copper stream, a number of other opportunities present themselves to Amur, which are likely to be considered in its TEO and/or any subsequent western BFS. These may be summarised, briefly, as follows:
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Altered/improved offtake and/or funding arrangements with traders, offtakers and/or joint venture partners.
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The potential for the Russian authorities to contribute to the infrastructure spend required to develop the project and especially the 338km access road. To date, the assumption in all of Amur’s economic studies has been that there would be no contribution from the Russian authorities at all in any form.
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Potential capex savings by using non-branded capital goods.
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The consequences for initial capital expenditure and cash-flow of using leasing mechanisms to secure the use of capital items (eg especially the mining fleet).
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The potential to expand the operation beyond 6Mtpa.
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The potential to enter into streaming arrangements as an alternative financing mechanism.
In addition, since Kun-Manie may be deemed a “regional project”, with collateral development benefits to the immediate area, there are a number of other potential opportunities available to it, including:
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A profits tax reduction.
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A royalty reduction.
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A reduction in social taxes for employees.
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A reduction/exemption from fuel tax.
In addition, there may be potential to optimise the production schedule and thereby to move revenues forward and generate enhanced early cash flow during the first 10 years of production. The biggest opportunity in this respect is the potential to merge the pits relating to the Ikenskoe and Kubuk operations into a single ‘mega-shell’, thereby simultaneously creating economies of scale and operating synergies as well as reducing the overall strip ratio of the operation. Additional enhancements include the potential to reduce the magnesium oxide content of the concentrate on which penalty fees are levied via additional metallurgical test work.
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