Chromecorp is in the business of mining chrome. Chromecorp has...

Chromecorp is in the business of mining chrome. Chromecorp has acquired the Bathlako Chrome mine in South Africa.

Production is expection to commence as soon as the BEE partnership is signed off (and license being issued which I assume would be a formality). Currently, ChromeCorp is talking to 3 BEE companies. I assume we should get an announcement regarding the successful partner very soon.

Total development cost is estimated at $5m.

Total production costs US$70/t

Current spot premium prices is US$200/t

Profit margin is US$130/t

Production rates 300,000 t/year

Mine life is about 6 years based on these rates

NPAT of US$39m/pa

Now how much would the shares be valued based on these figures?

Note that the infrastructure is already in place as the mine ceased production in 1996 due to the low chrome price. Since 2000, the price of chrome ore has tripled.