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Denpal says

"Remember VRE has a $236/oz capital expenditure/mine development cost, which added to the cash cost of say $580/oz means total ongoing cash and capital costs are $816/oz leaving $200/oz available before admin costs come out. Looks like about $15M pa after tax at current POG?"

Firstly, I dont know too much about the mining industry however will address the forum my question.

Is it common to include the $236/oz capex costs in the whole scenario?? I understand it is an upfront cost, but for the purpose of analysing the project, is it reasonable?

I reckon VRE's bankers would have looked at it this way.

Thinking out loud, $236/oz x 120,000oz pa x mine life 4yrs = $113M. I think this was the cost of the plant (?? pls correct me) which would still be sitting there at the end of the mine life, worth $100k (allowing for depn and R&M capuitalisation. However, it may not be worth anything if theres no resource to process.

Any thoughts??