Hi Quester,I would think that initially it is more prudent to...

Hi Quester,

I would think that initially it is more prudent to dig up the higher grade ores from HUB and truck them to the mill. This trucking model has been used very effectively by RMS and there is no reason why DCN can't emulate this model. Also who knows by 2023FY, GP may rise to the point where the extra trucking cost can be easily absorbed.

The build of another mill is probably justified if there is enough ores in the ground. However to build a mill is going to take time and it is probably at least a 2-3yrs time-frame before such a mill can start producing even if the decision to proceed is made today. Frankly I don't see LJ making the call now. He would probably want to see the 5yrs plan being executed for at least 2 yrs(to build up the cash position) before a new mill is considered. If you look into his track record, he does not like debt and therefore it is very unlikely that he will go into debt again if it can be avoided.

Also LJ is preoccupied with the need to find the base load resources to feed the hungry Mt Morgan mill. Any extra cash flow is likely to go into exploration until this base load is secured. Obviously if more gold is found in Redcliffe, then the build of this new mill can be fast-tracked.

Cheers.