DCN dacian gold limited

Merger Dacian & NMT - Discuss: Good idea or not?, page-6

  1. 4,626 Posts.
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    Greenflint - I disagree with your take on having a standalone plant at Redcliffe. Hauling from satellite mines to a central processing centre is a model that has seen Ramelius go from 6 cents a share to at one point $2.53 a share. By putting high grade shallow Redcliffe ore through the plant at Mt Morgans they save perhaps $100m in capital expenditure, bring forward production by 12-18 months, pay off the acquisition super fast, and/or allow them to mine what would otherwise be marginal ore. Of course the operating expenses go up a tad but Ramelius has shown that you can have low cost operations even with substantial hauling. There is a slightly increased risk in relying on the one processing plant but Dacian's plant is all but new.

    Also a bit of history: I am fairly sure that one of the nearby operations, I think it was Sunrise processing centre, was initially fed high grade ore from Mt Morgans for a while. It is a proven way of getting a mining operation on its feet.
 
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