mnc still in asx 300, page-6

AlbertE,

The total CAPEX has been a big hit to the financials.
At current copper prices for the 31 year mine life and an 8% discount rate I get an after tax NPV of ~300M and an IRR of ~10% (That is after factoring in corporate taxes, royalties, super profits tax and statutory employee profit sharing). Sure adjustments can be made here and there on the appropriate royalty rates and superprofit tax rate (depends on operating profit margin), but don't think the end result would be too different.

To put it in other words, for the project to have a positive NPV you need a long term copper price of about $3.25

I am sure there are some other projects out there that will get built first.

Sure there are opportunities to improve on this, can't understand why the mining inventory for the open pit has actually a lower grade than the open pit resource - shouldn't we be able to select higher grading areas?

At this point probably best to see the investor presentations that the company prepares for the different conferences to see what their selling points are - low opex is probably one of them

I regards to the prefeas study, I would hold from committing to it at this point, better to see what interest the announcement generates.

Alejandro
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BDR, HCH, MNC