Ok, now we know why this has been delayed by 3-4 months. They basically had to redo the feasibility study with a new mine plan & layout. Orecorp had opted for a combined open pit and underground op, probably trying to target the higher-grade areas, whereas Perseus are going for a larger scale open pit with a lower cut-off grade and more bulk operations. See how the Killimani pit has now been combined:
Orecorp DFS:
Perseus FID:
This results in a higher strip (3.68-->5.7). This must be a logistical choice and give optionality for potential UG operations later in the mine life. Look how they call the Open Pit "Phase 1"
Orecorp also nominated 4Mtpa of processing, whereas Perseus are going for nameplate 5Mtpa plant....
Fundamentally, it's a positive project with a late teens post-tax return. I don't think this includes the acquisition costs of Orecorp though... and I wish they'd shown the NPV on the 80% basis, especially given they absorb 100% of CAPEX and OPEX. There's A LOT of leakage with the 18% VAT, 30% tax, 6% royalty & 1% inspection fee... Tanzania is certainly getting a good deal as a whole.
I'm neutral on the project today, but with all things Perseus, they tend to under promise. A couple of years ago I heard that Silverlake (now Vault) & Perseus are the only two ASX gold miners to have earnt more FCF than invested capital. To that, on we go to Tanzania.
(20min delay)