Let’s just focus in on NN… • Current resource is 5.16Mt @ 5.74g/t Assume they get to 1.5Mozs and average grade drops to say 5g/t. Current price of gold is about AU$3100/oz Say, total cost of production (excl. tax) around $1800oz. My feeling is this is conservative given the higher grade, happy to be corrected.
So, You’re earning $1300oz x 1,500,000ozs equals $1.95B.
Tax on $1.65B (remember $300 accrued losses) is $490M. Leaves $1.16B. Assume $100M to restart mine (hopefully less) and we get close to the billion dollar mark. Obviously some big assumptions re cost and potential resources and no discounting of future cash flows. All this balanced, I believe, by exploration upside and potentially lower costs given the high grade nature of NN. Other promising lodes (4P, WW, SF) also not included.
My opinions only.
SPR Price at posting:
50.5¢ Sentiment: Buy Disclosure: Held
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