Hi @semiretired the take out from this
has implications for other projects IMO...
Lets have a look at the
5 year term unless either repurchased or redeemed....This gives 5 years capacity to pay back in full plus interest or either repurchased or redeemed...
View attachment 1824961
After
Pareto have done all due diligence and after all their discounts modeled they still backed the project and have agreed to a long 5 year term.... From the DFS based on the 40,000 TPA
self imposed startup the project will deliver US $43 million free cash flow...
The project underpinned by Premium Expandable markets differentiates to peers whom aligned their projects by vanilla markets and are underpinned by those markets with no free cash margin's...With the suppressed pricing of vanilla markets has these projects back at the drawing board and not knowing quite what to do...
To date projects running at 20,000 TPA and grades of 5-8 % TGC have followed the path to
care and maintenance status...One can draw by way of logic these
up and running projects integrate with down stream processing markets if possible. Producing more tonnage only presses back on basket price with no free cash margin and implication of higher capex...
New projects underpinned by vanilla/refractory will not be so lucky as they now enter the dreaded
warehousing of project stage...IMO
These posts of commission per word basis demonstrate the anxiety of those peer projects out their as real reality begins to set's in...IMO
Walkabout Resource has done well to differentiate from those unlucky projects and a strategy to grow into known markets with certainty....They have turned disadvantage to advantage in 4 years since discovery...It has the lowest capital intensity per ton mined with built in redundancy of plant... The plant can produce around 63 TPA IMO with out the need of bottleneck alteration's...Extra cells can easily be retrofitted to the plant improving scale....
Further to de-risking the project it can high feed grade the plant @ grades >than 22% TGC in first years of life of mine..That's 2 methods that can be used to derisk the project delivering 40,000 TPA
To improve scale has implications for peers IMO as these can be easily adapted and grow into known markets with certainty...IMO If these are simple adjustments projects with large scale will not be funded IMO as we can grow quicker than the competition can adjust or acquire funding...These commission post's have their own agenda but will leave that upto readers to determine..
Croc
