why abu, page-7

Thanks Scorpion, good luck to you too.

I'm only very confident in ABU for now, although I am having a good look at MML at the current price (and bought a few over the last week).
Unlike ABU it has had quite a few issues over the last year or two- not least of them being a fire in a shaft and maintenance issues with the very old mill.
Despite these problems causing lost time and bottlenecks and the fact that they continue to work on underground development with resultant lower grades, their cash costs are still incredibly low for an u/g operation.
Last quarter, on production of just 14,021oz, recoveries of 89%, recovered grade of 6.76g/t and with underground mining, they had cash costs of just $296/oz after royalties, local business tax and development costs. We do have much higher wages here for ABU, but we also have no u/g development work or open pit pre-strips, an expected head grade of at least 10g/t from open pit, likely higher recoveries and much cheaper gravity only processing. It’s difficult to imagine ABU not being a very low cost/high margin producer. I do see good upside potential with MML from here as well, albeit with much stronger political risk in light of new taxes, royalties windfall taxes and profit sharing being considered in the Philippines (although established operations are said to be exempt from proposed changes- if you can trust that!).