As we are now talking about the lovely Freida again, I will repost what I wrote 13 months ago on 28/04/2015 about Freida value to us as HIG shareholders/owners:
"Now we have the PANAUST (PNA) independent expert's report to help re our assessment of the value of lovely Freida.
On 100% basis from prelim work to date (and using target values):
Average annual Cu production: 125,000tpa
Average annual Au production: 200,000ozpa
All-in Sustaining cost: between US$1.70/lb and US$1.80/lb (after gold credits)
Current Cu spot price: US$2.71/lb
Profit (using higher AISC and current low spot price): US$0.91/lb being US$255Mpa
Profit (using CRU set. long term price of US$3.16/lb): US$1.36/lb being US$380Mpa
Mine Life: 20 years initially (utilising less than 30% of identified mineral resource tonnes) with target initial capex of US$1.7B.
The US$255Mpa operating profit would produce (at AUD=0.78USD) AU$262Mpa to PNA (40cpspa per PNA share), and to HIG AU$65Mpa (7cpspa per HIG share)
Now Freida does require feasibility studies, BFS, funding and development and so is a few years away, but the likely value is very high for PNA and HIG.
Even currently:
Unrisked Broker Value: $636M (Risked is $245M)
Unrisked Broker value of Freida for PNA shareholders (80% share): $509M being 80cps (per PNA share) - about 46% of GRAM bid price
Unrisked Broker value of Freida for HIG shareholders (20% share): $127M being 14cps (per HIG share)
Freida is of major importance to future of both PNA and HIG, and should not be under-valued!
