Ann: Procurement of Long Lead Items for the Great White Project, page-592

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Roch2077

10,189 Posts.

1986

01/09/22

10:19

Post #: 63455234
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Originally posted by szopen: ↑

It's good to talk about numbers and projections.

In my back of the envelope numbers in previous post I have excluded the cost of MEP acquisition (just under $4 million cash costs, what a great deal...) from cash burn rate. Looking at the last quarterly staff costs, corporate and administration for last year was about $6 million and exploration and evaluation also about $6 million for a total of $12 million. I can see exploration and evaluation costs reducing over time the staff, corporate and administration will increase. Based on this the $12 million a year of total non mining related costs looks about right.

The mining, processing and shipping costs per dmt of product sold in the DFS are estimated over the whole 7.2 million ton of product sold over LOM so actual costs for a much smaller start up plant would be significantly higher but for the sake of this discussion I think we can use slightly increased numbers as per your calculation.

In my opinion the problem shows up in the difference between $1.5 million costs of staff, corporate and administration in your modelling and current cost of $12 million per year. DFS estimate of these costs for Stage 1 is over $15 million per year.

Capacity and capex numbers.
My rough estimate of $60 million of capex is 20$ mine start and $10 million general (road, water, power) and $30 million processing for first train at 100,000 tpa of feed. Each additional train of 100,000 tpa may be around the same price so another $60 million to get to DFS Stage 1 capacity for a total capex of $120 million.

Based on the above starter plant will not generate revenue and will be making a loss unless significant reduction in costs happens ($1.5 million a year may not even cover directors remuneration).
This may make finding the $60 million of funding difficult.

All of the above are my back of the envelope numbers and opinions and there is a very good chance that I'm wrong.

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Company is not going to make a plant at a loss. Seriously let the company do it’s thing. People complain to much like they know what’s going on when they don’t know anything your a fool to sell at this level

ADN Price at posting: 5.6¢ Sentiment: Buy Disclosure: Held
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Ann: Procurement of Long Lead Items for the Great White Project, page-592

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Ann: Procurement of Long Lead Items for the Great White Project, page-592

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