Charles,
Use of independent smelters to treat ore concentrate is the usual path for base metal miners. The cost of a smelter is huge and they tend be independently owned by specialist operators and take concentrate from a number of different mine suppliers of concentrate.
What you are seeing with LAF is standard practice and should not be seen as negative.
The price they recieve from the smelter is dictated by the grade and impurities of the concentrated provided by LAF, as well as market conditions such as availablility of concentrate stock around the world and base metal prices.
It is very positive for LAF to have offtake agreements signed already.
Getting the concentrate to the smelter can be a killer cost for a lot of projects so LAF's reference to this seems to indicate their costs are low in this area.
I am yet to see a NPV valuation for LAF but think they will now be an excellent 12 to 18 month hold. Need to see valuation first but market cap still looks low.
cheers
acturtle
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