Agree, ALK should have provided this sort of update and change of guidance weeks ago, but it's done.
Now it's all about the 5 year plan. Which of course, is instantly a step back from the 10 year LOM plan released back in 2021. I mean, it's a huge step back from a 10 year plan, but hopefully, profitability is the key driver in the decision making process. For what it's worth, I still think the open pits will stack up even with the higher costs for the highway move.
Tommi LOM extensionSuffice to say, I am not willing to add to my position, even though over the long term, I think ALK is very undervalued. As this is what they had planned to do... we already know that the highway diversion is well behind schedule (I mean, it has not even gotten to having a secured contractor to do the job).
My guess is the open pit will end up being 2 years behind what is below. So perhaps FY25 & FY26 will be purely based on production from Tommi U/G and Roswell. Which likely means production will be curtailed to 70-80k p.a. ALK has not been very forthright in regards to how many ounces likely remain in the Tommi U/G, though my guess is around 20-30k going from the reserves report. Which gives ALK some wiggle room, though I really do hope they can provide a much clearer picture of whether they have successfully added to any of the Tommi U/G, like Caloma, Wyoming etc... having these as a second source of ore to supplement Roswell is surely incredibly important.
Here is my meagre attempt at forecasting what will be announced. Mind you, the ounces are not lost if the open pit is deferred, just pushed out, which is prudent IMHO.
I note the production drive, backtracks very closely to McLeans and it's 70k U/G resource. Perhaps if they can even just access 50%, that gives them a further 35k ounces to bolster Roswell and further pushback the open pits, which in turn, gives them more time to drill out U/G extensions not just at Roswell and McLeans, but.... also San Antino, which currently has zero U/G resources.
Yet when I look at this model... there are ounces below San Antinio. Would not take much to extend the development drive south to S.A.
The LOM plan mentions they simply have struggled to drill S.A due to the highway location.... which leads me to think again that extending the drive and then drilling from U/G makes a lot of sense (bold due to it being done without reserves, but it's paid off at Roswell.
I still have no idea whether ALK are able to reduce the depths of the open pits, and move more ounces into U/G, but... not long to wait I guess.
Good luck to all holders.....
(20min delay)