npv, page-100

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For starters, you have run with annual production of 'only' 320000 tonnes per month.

Given the incremental production profile they seem to be implementing, it is highly likely that once steady state production is achieved in 2016, that 400kt pm is the rate that should be used on an ongoing basis.

So, effectively you are 'robbing' the project of annual cashflows (using your inputs) of 80,000kt pm or 960kt per annum.

Using your cash margin of 720 per ounce that equates to about USD 93m per annum cashflow not included in your NPV calcs.

Over 35 years, that's some USD 3.2 BILLION (undiscounted granted).

Further, the fact that the NPV is positive by ANY amount is, in theory, a green light for the project. No doubt you are aware of that fact albeit it seems others are not.

With NPVs (and not even attempting to enter the argument of the validity of such 'valuations' for projects of this nature at this stage of their development) the discount rate is the means by which you factor in the risk of the project..... you don't work out the NPV then start to subtract amounts to see how positive the number that results.

more later, but the point is made.