$ 2.00 plus by Xmas, page-37

Great interest piece, here are some of my thoughts related to comparing Hemi and Hillgrove and why using this transaction as in-situ value will not be viable.

1. CAPEX requirements at HEMI are going to be somewhere between $1.8-$2.2B AUD based on expert consensus. The payback period from FCF for this I believe will be 3-4 years of full guidance production. Based on FCF from Hillgrove including ramp-up there is likely only a 9 month payback. This extends out to the fact that Hillgrove's AISC will be net zero or even negative at current pricing where HEMI will sit between $1300-$1600 USD/oz (still no doubt T1 cost profile).

2. DEG HEMI will not be a multi-commodity a mine. Hillgrove will not be as leveraged to Au prices. Of the $12b you mention (I've got $11.874B close enough), Sb will account for $7.067B or approx 59.5% of resource based at pricing of $47,500USD/t. This works both ways in terms of volatility as an ease of global tension and new Sb supplying coming online could see Sb halve. There is not a conceivable scenario where this would ever be the case for Au. Therefore, conclusion to take has to be a larger downside risk in commodity price volatility.

3. Scalability. Even with HEMI's 500kozpa production plans and 11moz+ resource there is still the potential to increase the plant size and mine life. They are not bound by the environmental issues and cautions that Hillgrove must juggle. Tailings is the first thing that comes to mind and the second is the nearby town and water bodies. Whilst Hillgrove may comfortably have a 10-15 year lom with 500ktpa throughput I cannot see them being able to increase this considerably unless the plant is reconstructed or moved offsite which is borderline insane. The last inhibiting factor is related to the nature of the ore bodies. HEMI is a bulk tonnage, low strip ratio open cut mine with optionality to extend underground after year 10 (I believe). Hillgrove consists of many thin high grade veins which in its later years will need large amounts of stoping to access if economically viable. This will in hand limit how large a mine Hillgrove could ever become.

Based on the above, there is not enough to compare the 2 mines and make any sort of consolidation between. The only common factors I can draw between the pair is that they are based in Australia and will process Gold in some capacity.

Hillgrove is very unique and if there was any recent mining transaction in Australia I would think would be of remote similarity it would be Evolution purchase of Northparkes.

I hope you find this informative. Some reasons work in LRVs favour and others don't, but the roadmap has been laid out for a very lucrative mine if management can execute in the 12-18 months ahead nonetheless.