capital needed

On my calculations CDU will have about $180m once the current placement is completed. The estimate for the mine is about $200m. On the assumption that some of the mine costs have already been paid, then the $180m is about enough to do the mine.

The predicted start date for production is about mid 2013. To be prudent, allow two years from now before the mining revenues begin to flow.

CDU therefore needs cash on top of the above to last those two years. The required cash is as follows:

1. Admin and exploration activities run at about $20m per year, so 2 x 420m =$40m needed here.

2. Buybacks seem to keep happening so allow about $20m for cash burn on this item.

3. General contingencies for cost over-run and any change of plans would ideally be about $20m.

In broad terms, an additional $80m in cash still needs to be raised.

CDU has said it wont borrow and it wont do a share issue to existing holders, so one or two new big investors are still needed for this additional $80m.

The Europe situation and slowing Chinese economy suggest that the sooner the cash gets raised the safer the CDU position will be.

Get ready for the next episode of cash raising. Will that need another trading halt as well?