Banter and general comments, page-1758

I'm skeptical about your figures here.

For starters, you have assumed the ongoing costs of mining are 1.2 billion. The cost per ton for mining is 300 USD for a 700 USD Spod price. Your figure literally cuts it in half the 2.4 billion you estimate the mine to gross but the costs should be closer to a billion dollars not 1.2 billion in cost to start with if the ratio is 400 to 700 (which is not 50/50). This of course also assumes the starting estimate is correct which you haven't explained how you reached?

Then there is your basic halving or more of the left over amount of profit to 400-600 million. I have doubts about this too. Obviously the taxes and royalties are not cheap but having just done some googling of what the average actual rate mining companies pay in taxes after deductions (17%) and Royalties (20%) so 1.4 billion in profit minus the cost of the mine at 85 million and your left with 1.315 billion once tax and royalties have been taken into account your left with about 870 million dollars.

This calculation of course depends on the Spodumene price staying at 700 for the duration of the 10 year life, along with the costs and average effective tax rates and royalties but in any case, that's a substantial difference mate and it takes no account of increased life of mine and resource growth, a higher spod price than 700, or the other minerals we have in our possession just to name a few factors. Or as Bread has pointed out, the fact that the market can also irrationally value companies.