This will tell us just how good of a project Mayoko is.
The key here will be Capex and Opex. Capex being how much it costs to get into production and Opex being cost of production per tonne mined.
Capex is more important in the short term as it requires immediate funding. Long term viability however is dependent on the OPEX.
I am hoping to see an OPEX sub $50. This will essentially mean even in the most bearish scenario ($80 Iron Ore) we will be profitable. Keep in mind that based on the metallurgical test work our ore grade will come out at around 64/65% which should mean we sell at around a $10 premium to the stated Iron Ore price the media reports.
Keep in mind BHP and RIO produce at sub $50. FMG and AGO are closer to $70 when everything is added in such as royalties. Also I believe FMG and AGO have a product that is sub 62% which means they sell at a discount to the benchmark price. This is why a long term Iron Ore price of $80 or $90 means profits for these guys are quite thin.
Can't wait to see the numbers...if they are good we should see a very nice re-rate.
EQX Price at posting:
77.0¢ Sentiment: Buy Disclosure: Held
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