RED 2.44% 42.0¢ red 5 limited

JID,I have modelled with extended open pit operations, as a...

  1. 10 Posts.
    JID,

    I have modelled with extended open pit operations, as a starter pit under current plans and a cut back. It paints a much better picture and is why I hold.

    My point is just that RED needs to clarify what it is going to do, in a release that will be picked up by analysts. It is time to move forward now that the project is up and running and put out some new reserves. Based on whatever waste position is tenable. It does not even need to be based on the new drilling, the existing resource would be enough to go on.

    It is not the capex that I model hurting the UG operation, but the need to mine the ore via road header and effectively paste 50% of the tonnes extracted. In Australia ore development costs circa $85/t for standard bolt and mesh, excluding fixed costs and we don’t use road headers even in soft ground. I have modelled $90 per tonne for the road header, assuming fairly intense ground support and that there will be some labour savings but it will be machinery intensive. I’m not a road header expert.

    I have assumed $35/t for placed paste including separation from tails, prep and cement, walls, placement. Level by level placement, top down mining means stop and start on the tails. I have no paste plant capital, or recurring capital in terms of extending and replacing pipes and have left all this covered in the tonnage rate.

    I assume $1,500 gold at parity. Another whole argument, but for me gold has broken down through what I had as my long term increasing support line and I’m cautious for the next couple of years.

    Cheers
 
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