re: News: Ampella Mining answers some key que...
This is a solid presentation. Kitto is a good speaker.
It should bring back interest in AMX.
Two things are of some issue to me.
Firstly they still need to do a lot of drilling to prove up a reserve of, lets say, 1.6 million ounces. Fortunately they have plenty of cash on hand which may be enough for this. Without a reasonable sized reserve they will not get the funds to develop the mine.
Secondly, I can not see how they will get production of 200k ounces per annum if their plant is 3 mtpa capacity. Lets assume they use the higher grade ore averaging at 2 grams per tonne in the first few years to build up a cash reserve for plant expansion, then they could only produce 183k ounces p.a at the maximum recovery rate of 95%. By using up their higher grade ore they effectively lower the average grade for the future (unless they find lots more higher grade ore), and they would need a larger plant in future to maintain production levels over time. This is not a criticism, just an observation which one needs to factor in.
By way of comparison, if they used an average ore grade of 1.6 grams/tonne and a recovery rate of 84%, then the 3 mtpa mill could only produce around 130,000 ounces.
Their plains look achievable, assuming what they are saying about the ore is correct.
loki
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