Ann: Bald Hill JV Tantalum Concentrate Sales, page-93

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31/10/18

14:18

Post #: 36333651
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Originally posted by El Jefe ↑

Do you expect ramp up production costs to be equivalent to LOM averages?
LOM averages (excluding TA+Fines) are approx $650pt from FS.
As with many companies, once production starts you can through the studies out the window to some degree. I fully believe they can be massaged quite heavily to reach an acquired outcome. Im not saying all do it but I have seen what I believe points to that often.

Im not agreeing with your $1000 pt figure because i can't remember the details (not saying your wrong) but I don't think that's unreasonable given where we are at but want to see it dropping as per my last post.

If we are to take LOM averages from FS at face value we are/were currently 50% above that by your figures. What does that tell you? It tells me either the studies were totally wrong (too early to say) or we should be producing at a lot less than $650pt towards end of next year after ramp up and pre-strip (we will be anyway because fines + TA will be fully online so will be hard/impossible to tell). Especially when FS was only considered on LOM of 3.6 years. If someone wants to work out $900-1000 pt for first year and what average cost per ton is needed in year 2 - 3.6 to get to $650 go for it.

Also not sure if you are getting confused with the two cashflows, the production is higher in the second one not because it was actually higher but because development costs can be accounted as production costs until the company reaches nameplate or commercial production. Either way its still high, just lucky we have had a good production ramp up.

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Hi El Jefe, here is my post when we first discussed it, just so you know where I got $1000t from
https://hotcopper.com.au/threads/ann-quarterly-cashflow-report.4332580/page-15?post_id=34659708

So my comments are really more that there was no explaination provided for this, not that there is no explaination. From memory you and Henry covered off issues such as high pre strip, lower grade initial ore etc.

Anyway, I am off to read the AJM announcements. Sure we will see some feedback from yourself.

TAW Price at posting: 24.0¢ Sentiment: Hold Disclosure: Held
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