very bullish, page-85

A few back of the napkin scratchings;

Assuming an IO price of US$100p/t getting into production in late 2013, and an OPEX of US$30p/t.

Current IO prices are at US$170+, but expected to fall somewhat as new supply comes online & SDL has been using OPEX costs of US$22. I think a sale price of US$100p/t and an OPEX of US$30p/t are quite conservative.

Let's use an output of 5mtpa DSO.

5mtpa x US$70p/t (US$100 - US$30) = $350m per year cashflow margin.

Current market cap ~$300m.

Let's change the output to 10mtpa, as EQX has stated the rail could haul up to 11mtpa currently.

10mtpa x US$70p/t = $700m per year cashflow margin.

You would expect CAPEX costs to be relatively low considering the rail runs right past the mine site and connects to the deep water port. The free cashflow can be used to upgrade infrastructure to allow for greater output than 10mtpa, and develop Badondo as well.

For mine, this is a long term beauty, just the thing I will be looking to pour some of my SDL profits into.