Ann: Adriatic Metals Corporate Presentation, page-148

After re-reading the Hod Maden PFS and consulting others, I need to point out an error in my analysis with regard to this statement:

"EVEN if they recover 77% of the gold, nearly HALF of that may not be marketable and the pyrite cleaner circuit may be removed!"

Gold recovery is in fact 77% in bulk flotation after fine regrinding (30μm).  All of which report to the copper concentrate.  However, gold recovery is 39% in bulk flotation (open circuit) after primary grinding.  Below is the cost curve for various grind sizes:

  

My 85% Cu recovery and 50% Au recovery is still a standard assumption for primary grinding/re-grinding.  My thesis remains the same with regard to Rupice - that the cost/benefit trade-off favors a flow sheet incorporating primary grinding/re-grinding to minimize CapEx/OpEx, as the marginal gold recovery will have minimal impact on cash flows. Incorporating fine grinding and/or leaching the tails would have a negative impact on the Net Present Value.

Here are operating metrics at Hod Maden.  Assuming underground mining, Rupice should have higher mining costs (ramp, room and pillar vs. cheap long-hole stoping at Hod Maden) but offset by much lower ore processing costs due to energy savings (Again, refer to the energy cost curve above):



The above noted, I've always assumed the high end of the OpEx range at ~US$80/t for underground mining (vs. $66.5/t at Hod Maden) in efforts to keep my models conservative.

Hope this was helpful to all!