Hi Panda,The CAPEX figure for STB is for a 1 MTPA operation...

Hi Panda,

The CAPEX figure for STB is for a 1 MTPA operation which equates to $739 per tonne.

The CAPEX figure for ELM is for a 1.8 MT operation which equates to $930 per tonne.

You need to compare the per annum tonnage so the difference is not as much as you make out.

That aside, of more concern for STB holders imo is the omission of any OPEX figures in their latest presentations.

In past STB presentations, it was mentioned that OPEX would be in the lowest 25% quartile but this statement has been removed in the latest presentation.

It is reasonable to conclude that the OPEX is not low at all.

You cannot assume low OPEX just because it is open cut. If you look at ELM's latest presentation on page 16, you will see that the only other Open pit Greensfield project is Verde which is located in Brazil, not Africa. Their K20% is 9% compared to STB's k20% of 11%. STB is only marginally better than Verde.

However, the disturbing part is that Verde's OPEX is estimated to be a staggering $286 per tonne making the company very vulnerable to being squeezed out of the market during times of depressed Potash prices.

So given STB's reluctance to reveal their OPEX figures, I think it is reasonable to assume that STB's OPEX could be pushing the $200 mark which would also make STB vulnerable as well irrespective of STB's low CAPEX. Their are several other developers with much lower OPEX figures than this.

STB management have a proven record of being strong promoters so I have no doubt that if their OPEX figures were impressive, they wouldn't have hesitated to release them.

Doesn't matter how cheap your CAPEX is, if you can't operate profitably it is of no use to you.

In saying this I wish you every success. It's a tough time for potash shareholders atm that's for sure.