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0.4¢ antilles gold limited

In addition to offtake agreements with smelters, AAU has also...

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capriccioso

752 Posts.

168

06/03/22

07:12

Post #: 60009867
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Originally posted by capriccioso: ↑

Yes, from a risk management perspective it makes sense to get LD operational first and then tackle an Albion plant. A particularly good funding deal from the Dominican Republic, say as part of the damages claim settlement, might change the timing and risk of building a plant. If the deal results in a joint plant with Rosario Dominicana SA, then the costs and risks could be shared.

Another consideration is if the plant is at La Demajagua instead of DR. Then the 'just few million' difference becomes US$10 million per year because of the US$6.5 million concentrate shipping costs that would be avoided.

So I still think it could go either way, depending on how the DR government behaves and whether AAU can get additional funding easily enough. Funding and sovereign risks aside, the technical risk should be low as AAU already knows how to build an Albion plant.

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In addition to offtake agreements with smelters, AAU has also mentioned selling to a metals trader, which should mean that it is possible to sell concentrate while an Albion plant is being built or is ramping up production. Even when the plant is operating at full capacity (say 75,000 tonnes per annum), any extra production by the mine could be sold to the metals trader.

AAU Price at posting: 7.4¢ Sentiment: Buy Disclosure: Held
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