"Conservatively we believe free cash flow over this financial year should be around $25-30
million at the current A$ gold prices. So it’s lived up to our expectations."
This financial year started July 2014, so that includes lots of ramp up costs (earth removal) in 2014, the lower ore grade area mined in December etc. Looking forward, 40-60 mio (depending on gold price and US$-Au$) seem realistic.
"All we know is that PAC is compiling the report to get back to the Minister for Planning and
Environment. Internally we’re budgeting for full approval to be received in the April to June quarter."
That's the decision by the minister - which could come sooner but nobody knows. Anyways, the PAC report will come sooner (like any day now ... I hate waiting ... again ... grumble ... just like Tomingley ... grumble ... oh well, that worked out in the end, too)
"We are often asked why we are continuing the process test work and why we continue to
operate the demonstration pilot plant (DPP). It’s because we are continually finding
improvements which are all very positive for our expected revenue. Running the DPP also
continues to de-risk the process flow sheet and improve the financial return."
Really looking forward to see the next numbers on improved REE recoveries. The last improvement was worth about 50 mio in revenues (above the DFS). If we can repeat that (and there is still room, especially for the HREEs), it would be really helpful.
"hafnium film can be applied to glass and have the impact of working as an “energy free” air-conditioner by reflecting the radiation from the sun from buildings without compounding the greenhouse effect when it reflects back into the atmosphere. Early days but an interesting development.
Hafnium metal price has moved from a couple of hundred dollars a kilogram to around $1,000/kg currently. We don’t anticipate producing metal, this is a very specialised field, but probably hafnium oxide which, though it sells at a lower price will still be capable of adding substantial revenue."
This sounds like they are looking at hafnium with a lot more intensity than I thought. Still, I expect them to add such a circuit only once the DZP is already up and running. OTH, if Boeing etc are really interested in a reliable hafnium source, they might be willing to chip in with financing the DZP ...
Are you intending increasing exploration at any project now the TGO is generating good cash flow?
Managing Director, Ian Chalmers: No, not really. We’re very careful about capital management and TGO is currently funding our activities at the DZP, pre commencement of construction. We are doing some small programs of a couple of hundred thousand dollars at Kaiser and Elsienora. Kaiser produced some exciting results and exploration gets underway at Elsienora in a month or so. We regard Elsienora as a ‘McPhillamys style’ target, McPhillamys being the multimillion ounce gold deposit we sold to Regis Resources in 2012.
I think that's a mistake. 10 mio cash more or less won't change much wrt financing the DZP. OTOH, being able to sell another McPhil for 50-100 mio (or to use as security for a loan) would be really helpfull ...
Company Interview question: In a Company Interview late last year, you estimated the value of the TGO and the DZP. Have these estimates changed with the higher Australian dollar gold price and lower Australian dollar exchange rate?
Managing Director, Ian Chalmers: They should, shouldn’t they? In that interview we mentioned a potential value of ALK could be around $250 million, with TGO being the major contributor. The DZP has an NPV of around $1 billion but obviously the market still substantially discounts this. We’re mainly concentrating on progressing the projects rather than continually adjusting our internal valuation numbers.
FINALLY! The pumping LTL has been warning about for weeks has arrived !!! (well, except for the fact that our management has stressed for years how undervalued we are ... oh well ... maybe it's a continuous pump? /s )
(20min delay)