The Mill, page-21

Hey Sabine,
sorry for the delayed reply. Regarding the plant, as you have pointed out, it has a throughput capacity of over 3mtpa (they hit 3.2mtpa in the second year from memory), but this won't be repeated unless they find a huge open pit. Not that they need to run the plant that hard anyway.

As for costs, just take a look at AUC for example to get a rough idea of what it would cost to build from scratch Dalgaranga (let alone all the permitting and drilling, pre-production that would need to be done, camps, air strips, roads etc etc). Plus for AUC, they have to buy a few more farms on top of what they have already acquired (I think they have spent $5-10m so far on farms!). Plus more drilling, another year of studies etc etc etc etc....



Cheers for that @plough
Such an interesting 20m or so. Strangely echo's my thoughts almost 100% in regards to funding projects.... we just have to look at the litany of failures across the ASX developers and their debt which has brought them to their knees again and again... and again! Though... I think one small thing they failed to link together, was how important management are in actually building mines, as EMR and CMM both took on debt, yet succeeded (though... CMM still did further raisings, so was not fully funded, hmm...). Perhaps this might go against many investors thoughts, but I don't see much benefit to debt, when it basically just adds risk (fine if you have the cashflow to support and pay it down, but, very different when you are a single mine asset). Especially, when as they mention (the fundy was SUPER keen to only raise!), if SPR was worth, perhaps $1 billion. Raising the full $100m needed to be 'fully funded' to production would seem very sensible since it's only 10% dilution.

I liked the bit about the fundies forecasting SPR to be sub $1500 AISC. That is market leading, and unlike RMS and it's Penny sugar hit, the low cost will last for a decade plus (they also mention 1m+ ounces in reserves as a solid target for Spartan). Head grade of 5-6g/t was also a very bold expectation (not complaining if it happens, though interesting, the head grade of Never Never is likely to be above 6g/t, as for now, they keep including the Gilbey's North/NN open pit ounces, which brings the total NN grade down).

Also interesting to hear Matty profess just how exciting it will be to mine NN and it's sisters... plus... the fundies 'call' that SPR will out do BGL grade wise in future years... uh, yeah.... they are clearly bloody bullish on SPR.

Looking forward to SPR getting the decline started as that then means... drilling from U/G.