The cost is wrong. In the mining process you need to shift 3 tonne of dirt to get one tonne of ore. Therefore you need to add $3.40 x 3 to the cost of the ore rather than just $3.40.
Administration and exploration run at about $20 million per year rather than $5m.
You have ignored the funding costs for the mine construction which may run at about $50 million per year assuming a 10 year life.
The production wont run at 3 million tpa until about 3 years into the mining process which is still about 2 years from now.
Apply all of that and no doubt some other missing factors, (eg EPS of 4 or 5 rather than 7 as the high % stuff runs out fast) and the worth slides back fairly quickly.
CDU Price at posting:
$2.09 Sentiment: Sell Disclosure: Not Held
