Agree with your thoughts calm. The more I look at RMS 10 year...

Agree with your thoughts calm. The more I look at RMS 10 year mine plan, the more I see why RMS is not actually in a position of strength, but weakness, in fact (though obviously the current cash flow generation is it's greatest strength). As while it has purchased two 'lovely' assets in Rebecca and BRB, those assets are simply years away from being in production and will likely have a production profile of 100-120k p.a at reasonable costs (neither asset stood out for their MREs, which is why stayed unloved for so long), and were only valued at a pittance by the market before RMS took them over and, from what I can tell, this has not changed. RMS seems to have it's full $2.1b market valued based on Mt Magnet and Penny, but... why is their script so strong?

After another morning obsessing about all things SPR (and... by default, RMS), whilst I know I am biased, I cannot help but come to the conclusion that SPR is... undoubtably going to be incredibly profitable to a decade or more, versus RMS with their.... I know they want to call it a 10 Year mine plan, but... 20% of the ounces off the bat, are simply 'exploration targets, that is not even inferred (another 10% is inferred), so... 70% of the ounces are in indicated (see below in Graph 2a). I also have some questions about Cue U/G and any Eridanus expanded open pit versus U/G (see the Gantt chart).



On first glance, yes, RMS is in it's sweet spot for production in FY 24 particularly, as Penny has been able to fully ramp up. The RMS 2023 3 yr mine plan has been very accurate, except it excludes that half way through FY25 (end of this Calendar year), Edna May turns off. So CY 2025 will be... 239k ounces as shown below (graph 1). If we look out to FY27, over 30% of their production guidance is.... exploration target ounces.... This would make the chart look more like this.... (see graph 2b)












Suffice to say, whilst I was very much trying to be realistic about my expectations in regards to a potential deal being done and the value of any offer. I particularly look at what occurred with both SLR/RED and WGX/Karora seem to have been able to achieve (though both are basically a merger of equals, though obviously there was a lot of debate on the HC threads regarding how uneven the deals were perceived to be, plus deals have seen the larger producer give away a large amount of percieved value to acquire a better asset), I am slightly less optimistic about what might come from RMS. Without doubt the the main qualifier is that SPR is not in production yet, versus the two deals I just referenced.

I can only imagine @Undaunted rolling his eyes! It would be an extremely interesting to discussion in regards to whether SPR would be more highly valued if they were getting close to production right now... albeit, not having Pepper in the mine plan, nor any of the other U/G resources.... a short mine life, more dilution, perhaps debt taken on, higher risk etc. I genuinely think... SPR would be worth less than it is right now.

Some of the above critiques may well made against SPR when they release a mining study, except, Never Never is... indisputably a 'gold mine', versus RMS aged and higher cost deposits across Mt Magnet. In saying that, RMS have proven themselves....

I can only imagine how challenging any discussions being had at a board level are about how valuable each companies script is....

As always, all.... of the above is purely speculative and should not be read as anything more than the ravings of a sleep deprived father.