value comparison, page-34

Thanks frogga. So that is for 1.15mlbs. To who will we sell the other 27.85mlbs and at what price? ;-)

Pingu, thanks for your comments, I'm interested in what numbers exactly you think are "conservative and robust"?

I keep reading comments from various posters saying things like this: "The volume available at spot is pathetic, not at all possible to be a forum to cater for total demand at any price", yet I'm not sure this is the case in reality.

For example, Paladin's average sale price over 2012 was $55/lb - only a little above the average UxC spot price of 2012 which was $52/lb.

Their full year report released this morning states they have mid-term contracts for 2.8Mlbs from 2012 to 2016 "from mid to low US$60's/lb" and that they have mid-term contracts to deliver "6.3Mlb from late 2012... Pricing will be determined predominately by the market price at the time of delivery".

So they have contracts in place for 9.1Mlbs from 2012 to 2016. Just under one third of that is for a price around the current long term average (low $60's/lb), so just over two thirds will be at a price "determined predominately by the market price at the time of delivery".

So this seems to me that the reality is in fact that the current market price does have significant influence over price of sales.

I guess it's possible Paladin are just terrible contract negotiators and can't get a good contract... but they've been doing this longer than PEN (and actually have mines that are actually producing/selling).

Do you have any other examples of contracts (like the one you mentioned) for significant resource at prices significantly above current spot price?