artificial market, page-27

agree its a bear market

you have to remember the money is being spent on a fixed asset....PP and E.

its not like they are spending it all on exploration and evaluation which yes, can be carried to zero in this market.

the plant being built has a carrying value and this plus cash. just as it has a sale value. you cant just say that the plant suddenly has zero value even as it is being built.

i do disagree that a project is not unprofitable till it pays of debt.

carrying debt is a good thing as cost of debt is so much less than cost of equity. i spent years optimising projects and they all should have some layer of senior debt as part of an efficient financial model.

where debt can be problematic is when technical and price risks are extreme...neither applies in this case.

anyway if kangala were not fully funded and UC id be giving you a v diff answer!

but it is