romania copper privatisation, page-3

Hi Dogboy1 and du,

du - excellent find - well done. I am impressed.

Dogboy1, I will try and answer your question.

Grade is 0.36%. It is currently producing 11,000tpa of copper. There is 900,000t of copper in the resource. It is open pit. It has been a government owned enterprise.

Negatives.
Grade
tonnes per annum of copper.

Positives
Location
Open pit
resource size

Can a neg be turned into a positive? Cannot change the grade. I suspect though, that the tpa can be increased quickly with some private rather than public management. If OZL can apply the knowledge it has gained from running P Hill to this open cut mine, then it could, with some capital expenditure and process improvements, quickly get the tonnes up.

So does it fit the OZL strategy? Not as it stands. If though, OZL can see that this is an unloved and un-cared for resource, it could be bought for say $100m, and be upgraded to fit the strategy.

It cost OXR/OZL about $1.3B to bring P Hill to production. That is about $130m for every 10,000tpa of copper, so the price is not outlandish. It would also (assuming OZL can ramp up the tpa of Cu) provide some short and medium term growth in copper output for OZL while OZL continues to extend the mine life of P Hill and bring C to production. At 50,00tpa, this mine has an 18 year mine life. I suspect though, that OZL would have a plan to ramp up production to something like 75,000tpa (any more and the capital cost would be too great for the mine life)

I would be really interested to know what the C1 cash cost is.

HT1