Using the $2bn NPV of vista to value 25% @ $500m is logical.
As you suggest this reduces CPL's share of peak funding required from $894m @ 100% to $671m @ 75%.
The $500m cash on hand then implies only a further $171m is needed to meet funding requirements. This can be reduced further by using contract mining equiptment. It appears this is the direction we are heading given Genes comments in the BMO conf regarding having an agreement in place sometime this year for contract mining.
This is exepcted to shave $250m - $350m on 100% basis, or $188m - $263m on a 75% basis. Phase one production is 5mtpa, so lets say that contract mining would reduce peak funding requirement for CPL by $94m - $132m (i.e. linear relationship between mining equipment cost saving and production rate)
From this we can see that the remaining funding required would be in the range of $39m to $77m. Which would easily be debt funded. Importantly from this it appears under this scenario no more share dilution is required.
What should this do to the share price?
I would think that the combination of no more share dilution, plus funding certainty and importantly the JV partners willingness to transact on the deal @ NPV value, one would hope the market would assign a share value at least equal to the NPV value of Vista.
This would be a share price of about $2.90. (note we would still be valued at 100% of vista as the NPV of 75% would no longer have the CAPEX deducted as we would then have contributed this amount = 100% of vista without CAPEX contribution). Of course this value is for vista only, vista south + + should also be assigned some sort of value at some point.
All eyes now to what we get for our 25% of vista.
All IMHO only
Good luck to holders.
CPL Price at posting:
$1.52 Sentiment: Buy Disclosure: Held
(20min delay)