The implications of this announcement are profound for Avanco.
Firstly the balance of $250,000 ($100k already paid) would have been banked by AVB in the last few weeks. Very handy. The requirement for Vale to drill 2500m in the first year is absurd now. I mean with FIVE rigs hitting it hard??!!! FIVE rigs! unreal.
Provided they get the results, and it appears that they are, they will simply complete the drill program to the point of confidence, and take Trindade North or not take it.
With the good weather they are going flat out to resolve it one way or the other. None of this feeding a few dollars to AVB every year I reckon.
So there is a good possibility that provided good and economic results are there, that the payment of (up to) $40m to AVB (Woody talked about $30m) will be dramatically brought forward.
IF they really like it, then a new deal will be struck very much in Avanco's favour to make a quick sale... I suggest.
That means next year's AVB mining, plus a vast new drill program, could well be fully funded by Vale !
It was a brilliant deal by Tony. Extremely astute.!!
Trindade North always belonged to Vale in the sense that their rail line ran through TN and AVB was never going to be an iron ore miner... ever. So a good deal was the best outcome.
The only fun will be if copper is found too..... now THAT would be interesting to say the least. So inspect those cores carefully for chalcopyrite..
AVB Price at posting:
16.5¢ Sentiment: LT Buy Disclosure: Held
