how skaergaard could unfold

Done some more research into this one.

Using info taken from

http://www.galahadgold.com/PDF/EquityDevelopmentReport-GalahadGold-30June2004.pdf

I have attributed today's values, and assumed AUD/USD = 0.83

Using my own assumptions I have suggested that these days, it would cost US$800,000,000 to establish a 30,000 tonnes per day operation at Skaergaard. Guessing that US$240m would need to be raised to go it alone in Greenland.

Inferred Resource (oz) Price (oz) Recoverable @ 80% Per Share (USD)
Gold 10,900,000 $690 6,016,800,000 194.0903226
Paladium 35,100,000 $385 10,810,800,000 348.7354839
Platinum 3,000,000 $1,320 3,168,000,000 102.1935484
19,995,600,000
IGV per share US$645.0193548

AUD/USD 0.830
Shares Issued 31,000,000

IGV (AUD) 777.1317528

Cost to establish 30,000 Tonnes Per Day mining operation in Greenland 800,000,000 USD

70:30 Debt: Equity Structure
Equity Needed To Be Raised 240,000,000

Assuming 80% of 30,000,000 tonnes a year is mined at current spot prices, and assuming the tonneage is mined in the proportions of the in ground resource, for 180 days per year, the company brings in revenues of US$2,203,596,734 per year. Not including any little extras that occur as a by product.

So IN SUMMARY if the inferred resource is correct (and if anything, we can assume it is conservative) at some point in time PGM will need to raise around US$240m (probably a little more in a few years) to establish a mining operation at Skaergaard. The operation would then bring in US$2,200m per year, minus annual expenses (which will probably be a drop in the bucket, maybe another US$200-300m?).

So you're looking at approximately US$2,000,000 per year for around 6 years (the mine life at 30,000 tpd for 180 days per year would be about 5 and a half years).

Not a bad punt at a A$30m market capitalisation?

Thoughts and feedback for where I've gone wrong, please.