Ann: Completion of Pre-Feasibility Study for Zapu, page-3

re: Ann: Completion of Pre-Feasibility Study ... Heya TKTrader. I'm not pgamble, but I too, am interested in his opinion.

Meanwhile, I'll give you mine. I was in GLA in the past and still keep an eye on her.

The PFS is a milestone, for sure. Someone seems willing to pay 10% more than the current share price, and we know GLA can be thinly traded- not much news flow with this one. Re the PFS:

$455m capex is a fortune. Hopefully, they can develop the project @ the reduced figure of $200m mentioned- still a fortune, but this, from the report seems positive:

"Grant Thornton in Uruguay was commissioned by the Company to undertake a review of the project. The review
assessed the potential for the Project to access the Uruguayan Government’s investment incentive schemes, the
impact of potential taxation changes in Uruguay and the overall Project cash flows and financial returns.
Based on the review a substantial portion of the capital investment is eligible for consideration under the
investment scheme, which will provide tax advantages for the Project."

On the internal rate of return, the bear case is 14% after tax and the bull case is 24%, with the median 19% IRR. I don't know if the IRR can be lifted with the lower capex figure of $200m or if opex costs keep the IRR figure constrained? Does the 19% figure include potential Uruguayan tax benefits?

A 19-year mine life is pretty good, I think.

The document says they have "major end users indicating
interest for off-take contracts". They need to get some of this signed off, I reckon. It would be good if they got Noble on board. Noble loves all kinds of commodities supply, so it's not out of the question.

As to funding, would they do a 60:40 debt/equity? Have they got other assets to flog off to get some capital? They do have a few assets, but sale of those wouldn't go close to the cash requirements. Off-take agreements could provide capital assistance at the front-end, maybe. We also have our deep-pocketed major shareholder. They could chuck in some money.

Dunno what will happen now. If/when it goes forward, it will be a major project. A tiddler like GLA with capex of $455m, or $200m best case... mind boggling figures. Hopefully, the major shareholder will buy the company out. The assets are only valued at a few $million now, not including cash. The capex is at best, 100X that.

Your thoughts?