More than happy for posters to disagree with my views below or...

More than happy for posters to disagree with my views below or point out where I am wrong.

BGL cost to get into production was about $400m with half raised as equity and half as debt.

Compare this to SPR which I believe is heading towards a a similar production profile to BGL ie circa 200k Oz pa over 10 years, which I believe is much more likely based on the NN ET and more drilling at other deposits (the other deposits have an MRE of 750k Oz and I see that may get to exceed 1m Oz at the next MRE bring the total MRE at the next update of 2.5m Oz or more.

I have seen numbers that SPR needs about $100m, maybe a bit more say $120m to restart production - let’s assume that excludes any for more drilling during the period from FID until they are cash flow positive.

SPR already has $300m sunk cost in the existing plant and needs another say $100m ie about same total cost of $400m as BGL.

Banks agreed to loan BGL $200m about 2.5 - 3 years before BGL is cash flow positive. This is more risky than loaning SPR $100m since SPR has lower cost blow out risk, much shorter period to production, an existing plant that has been tested and with the current POG would probably be cash flow positive at a grade of only 0.9g/t.

If SPR came out with a DFS with an ASIC of $1,300 or even $1,500 (BGL DFS ASIC was $1,000 to $1,100) and a significantly higher gold price than BGL of $3,300 or higher, than at their DFS (I think POG was about $2,600) then a bank is exposed to a lower risk for a $100m or even a $150m loan than loaning BGL $200m. Then consider the lower risk items from the previous paragraph.

In conclusion, why would a bank not loan SPR $100m to $150m to restart production as it seems a lower risk than loaning BGL $200m? What is stopping SPR from totally funding its restart of production using debt especially as POG may be a lot higher than $3,300 in 9 months to a year when they would probably need to start hedging? While I am not a fan of hedging, and while I am speculating, SPR may end up hedging up at a POG up to $1,000 more than BGL’s hedging price.

I expect SPR to fund its restart of production totally from debt as the numbers more than stack up but it will probably need to raise equity to fund additional drilling in the 3rd quarter of 2024 until they become cash flow positive. So for institutions wanting provide capital for an SPR equity raise, they may be quite disappointed as the SPR may not need to raise much equity before it goes into production. That would be quite beneficial for the SPR SP.

PS when SL makes comments about organisations wanting to provide funds don’t assume they are all wanting to provide equity as there may be a number wanting to provide debt.

PSS- with the NN ET target the MRE grade for Dalgaranga will probably get to 3 g/t or even more which will improve the projects economics ie lower ASIC.