Updated silver stock comps, page-27

@stelios

actually it is true but i know precisely to what you refer

it generally turns on the cut off grade the boards are willing to go with

so - theoretically - low grade projects get better resource to reserve conversion the higher the metal prices go

but because the downside risk of planning a mine around taking in more low grade material rise the higher metal prices rise - what you will typically find is that experience boards are unwilling to overextend their mine plan assumptions

have a look around atm - youll find experienced boards typically might use say a $us1400/$us1600 gold price for mine planning - but strike their revenue projections off much higher pricing to reflect current spot

The higher metal prices go - the more experienced boards typically do that

So what happens with low grade vs high grade is

- high grade project boards are more comfortable planning a bigger mining envelope based on high metal prices

- low grade projects will typically lag the high grade projects in terms of what they are willing to assume is safely mineable over full LoM - but their project metrics become better because they have higher operating leverage at a cashflow level (ie they start making more per mineable ounce/waste fraction)

The tradeoff is that - if you get a gestalt shift in metal prices - you may find low grade projects are willing to use much higher base case metal price planning assumptions - with the tradeoff that usually capex vaults higher at the same time - because every man and his sog suddenly has a viable project in their back yard