Ann: Hermosa Project Non-Cash Impairment, page-29

The holding costs and capex should already be considered in the carrying value of the asset so should be part of the writedown.

The whole question of where in the life cycle you should buy an asset is complicated but I rarely find buying into development-ready projects is a good decision. Generally the revenue side of the equation is well-constrained, the mineral reserves are well understood so you end up paying full price for them. But the gremlins in the development plan haven't come out yet - or, if they have, the seller is aware of them but isn't exactly putting them in the sales brochure. So the revenue rarely surprises to the upside but the costs often surprise to the downside.

And that's exactly what's happened here. The irony of it all is that S32 held off for so long buying an asset because they were wary of overpaying, they wanted to do full DD.

I think if you want to buy an asset, you're better to either buy it cheap at an earlier stage and take on risk, or wait until it's operational and the bugs have been ironed out.