Banter and general comments, page-36979

Regarding restarting mining at Grants, there is only one obvious capital item and that may be deferrable. There is no Concentrator plant (its built and operating). There is no tailings ponds (they are built). There is no site offices (they exist). There is no moving equipment that needs to be restored to working order (its a pit in the ground thats on C&M not moving equipment). There appears to be no huge stripping exercise before reaching any ore - the stop point was price based/weather based (or getting rid of Lucas based) not because all available ore had been removed and the southern pit walls were at max slope. There is potentially the cost of buying diggers / haul trucks. Core's financial statements already show them using leased mining gear so leasing is their most likely route towards more mining equipment. IMO Grants restart has minimal capital costs before at least some ore is being produced.

ROM to Concentrate conversion efficiency
Pilbara's last half year statements noted a head grade of 1.3% (but I'll assume its just below the rounding threshold at 1.34%). PLS had recoveries of 66.2% meaning 1,000t of ROM to a 5.2% grade would generate 170.6t of SC5.2. Core's AR showed 28.8kt of contained Grants open pit ore reserve over 2.0Mt which implies an average grade of 1.44% (the stated figure was rounded to 1.4%). The December quarter recovery was 63%. On those metrics, if Core took 1,000t of ROM it would generate 189t of SC4.8 (or for comparative purposes 174t of SC5.2).

Core basically has an identical ROM to concentrate efficiency as Pilbara. Pilbara is clearly incredibly financially viable. If Core has similar ROM to concentrate efficiency as PLS, it doesn't need to do Flotation while finances are tight to get back to a financially viable processing operation, its already there. Flotation is in the want to do, not need to do category. The wildcard is whether BP33 ore is materially worse than Grants but on the released testwork (from some time ago) it may actually be better!!. If Core only wants to do, rather than needs to do Flotation, it has greater flexibility around timing so the project can be started when cash flow is sufficiently robust. Until that time, Core just stockpiles fines that will later go through the flotation plant. As Fines are currently "waste" the flotation plant arguably has perhaps a A$300/t cost basis (using GL1's scoping study operating costs). Its possible that Core's DMS plant designed, built and operated by Primero has much higher operating costs than PLS DMS and flotation plant combination built by Primero. Given flotation has a higher operating cost than DMS only, I'd find that unlikely.

There is clearly wide speculation on the capital cost to get BP33 running. If Core's DFS and July 2022 ore reserves update are even remotely close to correct around the underlying tasks requiring capital expenditure, most of that cost is actually in the early works package and the residual capital cost to get BP33 operational is small. This will only become clear when the BP33 DFS is released.

Core's cost problem (if its even real) exists in the Mining space. Within that space GM is doing work to reset the cost base. IMO expect some market surprising numbers when they start to emerge on restart. If this is correct, it would be silly to go down the JV arrangements pathway when Core is in a weak negotiating position. MinRes expects a high return on capital so you aren't getting cheap finance by entering a JV with them.