I don’t really think about it as how much left to spend because...

I don’t really think about it as how much left to spend because there will always be spend doing further development, ventilation etc.. it’s more a question of when does the revenue start flowing to offset the spend and then add cash flow.

From the quarterly they state the power upgrades and primary vent fan were completed which allows for a second jumbo to come in. This should materially increase development, opening up new mining areas and improving productivity. This mining equipment would be brought in by the contractor Redpath so no really lumpy upfront capex just added ongoing costs. I think site costs will move from $20m per quarter to $30m per quarter as mining ramps up.

It seems to me that maybe the last decent piece of capex is perhaps setting up the paste plant (I recall bringing that from Dargues) and then they mention road upgrades. I don’t think theyd be doing upgrades to intersections etc unless they were confident the approvals would come through.

You’re right on the plant expansion though. Peak is doing around 130kt per quarter which leaves around 70ktpq for Federation to add before you start hitting limits at the mill. But some extra stockpiles to optimise blending for improved recoveries etc doesn’t hurt for a quarter or two.

They milled 16kt in December quarter. My “guess” is maybe that climbs to 30kt this quarter, 60kt in June quarter and then 90kt in Sept quarter.. so I don’t really see it hitting major plant limits until the December quarter.

The throughput expansion needs a jaw crusher at the front end and a ball mill as a tertiary grind.. the latter is coming from Dargues, how long a jaw crusher takes to order and both to be installed is anyone’s guess but maybe only 6mths ?? If they get permits and hit FID by March maybe okay?

My dumb math is the ore is worth around $400/t net revenue.. once you start to get up to 60-70kt per quarter ($24-$28m) you should be covering costs and hit commercial production which was expected around September quarter. In 12mths time you’d hope they are at nameplate 150kt per quarter ($60m+ net revenue) which will be a nice $30-$35m margin.

At the risk of being shot down again - MAC have a 1.7mtpa copper mill of which they are using 1.1mtpa. You could send the copper ores from Peak North mine over to CSA freeing up capacity at Peak mill and run Peak as solely a Pb/Zn float mill with Federation and South mine ores (plus CSA have some high grade zinc lenses they can’t process). Huge synergies.