METALS-Tin hits 22-month peak, page-2

Hi Chestermemate,

good to see someone else on the thread ,

SRZ are looking at a fast start restart - please see my previous posts re links and prices - the restart under this model is approx. $43M or $47M from memory, producing 200,000t per yr rather than 600,000t, at 1.3% approx., and at about 80% recovery this gives us around 2,080 tons/yr. They etsimated cash costs of $A14,500 and tin is currently approx. $A27,500 ($US20,875/0.76), giving us a profit of $13,000/ton, or approx. $27M/yr (on a pe of 5, this puts us as $135M mcap). This would mean we could pay back debt in around 2 yrs (if bank financed or offtake agreement financed or both rather than CR), and then using cashflow for further development. This fast start model is more share holder friendly and results in getting the company back into production but may not result in a huge spike in share price as we are profitable but not producing at levels we could be producing at but means we do not have to get anywhere near as much funding. At $US30,000 ($A39,500), our profit becomes $52m/yr at production of 2080. Using cashflow to increase to 600,000t/yr (6000/t/yr+), our profitability hits $150M+/yr! and we are valued at $13.5M???? LME levels are near all time lows (2745 as against 2985 currently) and despite the rate of price appreciation, the previous two big tin price run ups went up quicker. As Hottin suggested, tin will simply be forward contract sold as it comes out of the ground shortly. Based on current levels and continued shortages and Myanmar appearing to be peaking and declining from now on (20% of world supply currently), then this is why some are talking about prices as high as $45,000/ton US!!!,

kind regards, SEAH.