Good feedback - and plenty of ways to skin the cat and perform ones analsis.
To your first point of "How about we wait for a resource size, more metallurgical work, a PFS, a DFS, a BFS instead of trying to guess how much revenue, what the AISC will be" We'll obviously that's the only way we'll know for sure - I am however happy to do calculations on known items and input assumtions.
You yourself contradict yourself within your own post by postulating a back of the napkin calculation on resource size. Should i tell you not to make estimations of this and to await the JORC compliance resource release - or would I think it's good analysis for someone to take the effort to understand the size and grade of the resource.
For what it's worth the "useless concentrate basket" only needs 1 figure of input to define the companies revenue which doesn't currently exist. It's the front end mined tonne rate. That's it. That mined tonne rate I used gives a high level indication (aka an estimation) to some degree on what the revenues could/would be at that rate. (This also answers your second point in regards to IXR as it's their full capacity production rate.) Thus it shows what MEI's revenue would be comparable to IXR's revenue - if they built the same sized plants and threw their different products in.
If anyone wants to convert it back to a mined/t figure (if that's your preference of visualisation) you can. divided the revenue ~$452M by the mined/t 12,500,000T mined. = 36.16usd per mined/t. Note that this figure doesn't vary greatly from my greatest critic first principal figure either. Just 2 different methods to arrive at the same outcome - mine at least with some supporting evidence to support it.
The composition of the elements is based on the current reported data.
When the JORC comes in i can update it.
The recoverable revenues are based on the met results from the sighter test work.
When the comprehensive composite sample extraction method comes in i can update it.
It takes many years and then a team of full time experts to develop a feasibility study to determine the profitability of an operation to +-30% accuracy or higher depending on the confidence targeted. At times we're talking between 2-5 years of refinement, defining, studies etc.
The problem people make with taking the value within the ton is that there's a lack of understanding of the saleable value of the end product. i.e. One can compare a 2700ppm ionic clay in ground value and then 2700 hard rock in ground value.
The assumption from some is that the 2 end products are the same if you recover the same amount of material. That's only part of the equation because there's also a beneficiation factor. i.e. a hard-rock project would likely produce a 40% MREC against a typical ionic clay product generally being 92% MREC. (One has double the contained REO) - both still can have identical ppm and composition - both in ground and post-processing. Then they have different payability (depending on the state they are in). (Although the ionic clay's don't recover the stuff all that linearly.)
It's an analysis method for me. One that's worked fairly well. The more detailed the inputs the more detailed the outputs. When we get to the study phase, we'll can pressure test the revenues and see to what degree of accuracy I was able to land on.
Do agree on potential and we're talking about the same figures in principal.
My figure is what you get on a payable tonne of product. (need to multiple by saleable tonnes)
Your figure is what you get on a mineable tonne of product. (need to multiple by tonnes processed)
Both of these are typically reported in in feasibility studies or can be derived as they are deduced from the same inputs/outputs.
SF2TH
MEI Price at posting:
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