Under valued, page-190

Hey Crab,
McPhil's PFS back in 2017 expected the AISC to be just under $1000 AUD. Not surprising considering its open pit with a low strip ratio (4:1), though the strip ratio is higher earlier on... I think the AISC will be be more like $1200 AUD, but... perhaps not much more than that, as... it's a good project. In W.A it would be worth $1b+ alone... (if being developed, like CMM for example).





I do find it interesting that the ore reserves was priced at $1400 AUD. Most now use $2100 AUD. That does not include anything from DIscovery Ridge/Bob Hill.



At this point though, I almost wonder if the market ascribes any value to McPhil's....?

With an E/V of just $1.5b... even I dipped my toe in today and added a few (had not planned too, but... at a 26% discount to the recent raising, it feels fine to be buying. Sort of like buying the Tropicana asset for 26% less. Pretty sure the market would have been happy with that). The out performance is quite glaring, though... other good gold produces are falling too (RMS for example), but not all. CMM for example is powering ahead.

My positive view on RRL last year (before the dividend cut), was dashed, yet... at this point, even with the crap hedging, somewhat short mine life (only half the reserves are for W.A), RRL is going to be making a lot of cash in the next few years.

Perhaps RRL would be best to hive off McPhils to the Chinese for $500m, and the share price would probably double versus developing it, but of course, longer term, developing it would be a give RRL a new long life mine.

Anyway, never possible to buy the very lows, but... it sort of feels close.