The preproduction expense at k2/phb/k1 is another can of worms but let's open it. After Superior spend $3mm capex on K2 then Superior earn 50% of two, potentially three k2 tenements and vango then got to split all costs thereafter with Superior on 50/50 basis. K2 underground dewatering need 3km pipeline, pumps, generators, diesel, wages, just to get water out. After k2 underground dry she will need lots of shotcrete for safety of miners and a bunch of drilling to firm up resource. Big preproduction cost. Four phb open pits permitted by Barrick in 2005 have like 100meters of overburden to be removed before ore can be accessed. Moving 100m overburden going to require lots of wages to be paid up front as well as diesel and lots of expensive machines. Will proceeds of 2yr note cover these preproduction expenses that must be paid prior to first revenue from pour of k2 gold dore?
VAN Price at posting:
2.9¢ Sentiment: None Disclosure: Not Held
