Constructive Dialogue: Copper M&A the Cupboard is Nearly Bare, page-24

"I recommend that you read the independent analysis of Kalkaroo that was undertaken by BDO/AMC. This is an independent assessment by experts who look at a lot of projects. The document was released by Havilah on 31 July 2019. BDO/AMC applied a higher copper price but ended up with a lower valuation for Kalkaroo than Havilah did in their PFS. They came up with a mid point valuation of around 23 cents."

@Truthordare


With respect to the Kalkaroo Project Pre-feasibility Study ('PFS') released on 18 June 2019, it was originally prepared for Wanbao by RPM Global ('RPM'). RPM is a competent and independent firm that has provided consulting and advisory for over 50 years in the delivery of over 14,000 studies and reviews across all key mining regions of the world.

As set out in its Independent Expert's Report dated 30 July 2019 (page 41), BDO concluded "the value of Kalkaroo to be in the range of $240 million to $280 million, with a most likely value of $260 million" at an after tax discount rate of 11%.

Looking at Table 5 in the Kalkaroo Project PFS released on 18 June 2019 (page 10), RPM said the post-tax NPV_10% of the Kalkaroo Project was $258 million.

Lastly, for Kalkaroo BDO never came up with a mid point valuation of around 23 cents! Do not get confused with BDO using its somewhat clunky mechanism of a 'notional capital raising'. No rational company would develop a mineral project this way. As Peter Strachan said in his StockAnalysis report on Havilah dated 19 August 2019 (page 2) "This [notional capital raising] might be a good base value for putting up on a whiteboard, but it has no relationship to how projects are actually funded in the real world and how much value can be captured for shareholders with more innovative thinking."

You should remember what the former Havilah CEO Walter Richard said in a 18 June 2018 Tweet, "Kalkaroo's Ore Reserve clearly indicates the significant value of this copper-cobalt-gold project ... the large Ore Reserve estimate highlights Kalkaroo as a standout amongst the very few open pit copper development opportunities presently available in Australia."





Reminder: RPM concluded that “the [Kalkaroo] Project has no significant issues that would prevent successful mining and processing of the ore. Furthermore, there are a number of opportunities to increase the Mineral Resource, increase product output and add value to the Project.”

One of the objectives of the updated PFS, if feasible, is to sufficiently increase ore block values such that a portion of the large Kalkaroo Inferred Resource can eventually be incorporated within a larger optimised open pit design. This could potentially increase mine life and also total life of mine revenues. In turn, this could also have a flow on effect to the Kalkaroo Project's NPV, IRR and/or profit margins.


P.S. You obviously missed the point of that Hudbay slide. Also, the reason why many have not been developed on that Hudbay slide is NOT because of their low grades. As Hudbay pointed out on that slide, many have material impediments to development (i.e. technical, permitting and community relations).

None of those 'material impediments' currently apply to Havilah's Kalkaroo Project.

Cheers

These are only my thoughts and it does not constitute investment advice. Before acting on any information you read and before making any financial or investment decisions, you should always consult your advisor(s) or other relevant professional experts.