Total capital cost of $153M including $25M contingency.
I think this time they will use the contingency fund given the exchange rate that they use is 4 to 1 instead of 3.2 to 1 currently.
They make a comment regarding "underground access activities will be funded from existing cash reserve"
how much of the $153M will be funded from the existing cash reserve? depending on how many $M, they should be able to borrow money to fund the rest of the project, however the current calculation doesn't take into account any interest cost. so the IRR between 28.6% and 59% is actually 13.6% and 44%.
as there is high chance that they will use the contingency, its not likely that they will get 44% IRR more likely on the lower side. also regarding the future copper price that they use in the assumption which is significantly higher than the existing price, there is a chance that this project is a low IRR project unless there is a turn around in copper market.
all just IMO. however i still think that 5c a share is cheap
AVB Price at posting:
5.1¢ Sentiment: Hold Disclosure: Held
