brokers coverage ....who to believe ?, page-19

Bouhr

Two parts to the equation but I look at it as SDL being purely a miner.

Mine – 35MTPA

First part can be 75% debt funded – So would need close to $200 to $250M.

Whatever equity interest is sold they would need say minimum $250M. The rest can be financed.

If NPV of Stage 1 is around $4-$5 Billion and if their dilution of the project goes down to 76% after the governments take then we can work on round numbers at NPV being $3.5B for SDL’s share

How much of the project do you give away when the deposit is no longer stranded and you have a viable Rail & Port solution and full offtake for life of stage 1 if all we are doing is mining?

If they sold 50% stake for $500M, project would be free carried with no further finance required and no further dilution.

If we then retain say 50% - NPV 1.75B – discount it by 50%-75% for risk then I get a rough value of around 12.5 - 25C per share.

With such low costs for stage 1, I would be very disappointed as a shareholder if they gave more than 25% away. Payback is too quick not to use some sort of debt funding on 35MTPA operation

If more was sold then I would want some stake in the Port & Rail Infrastructure as well.

Cheers