just quoting, page-35

jumpstart, I agree with you, they won't get it "on the cheap", it all depends on the terms of the offtake agreement. This was negotiated almost three years ago, and is for a 20 year term. So presumably the scale of prices is set firmly. OW have to pay a certain amount based upon the LME price, quality, % of concentrate etc. Possibly with floor and ceiling prices ...

Anyway - set in concrete. Shouldn't be any transfer pricing questions arising.

However, there is a lot of mineralisation beyond the initial 10 year plan which is, at current prices, pretty marginal through the 3mtpa plant. You can expect divies in the first three or four years if the head grade is maximised at 3% Cu, but you're robbing divies from the future.

If you were in OW's position, wouldn't you want to make sure that the mine was profitable enough to keep producing for the 20 years of the agreement, thus maximising the profits you are making on on-selling the concentrate/NCu whatever is included? Which would be best assured by dropping the head grade to, say 1% copper by mixing it with mineralisation from the < 0.8% cut-off zones and spreading the higher grade stuff over the life of the offtake agreement.

No transfer pricing problems, although there would be the possibility of a case for oppression of minority shareholders arising.