A bit of a lay comparison that may be of interest.
As per 26/07/16 Quarterly, RDM's Maronan project (Silver-Lead and Copper-Gold) is in front of select 3rd parties for review/JV funding.
We have discussed the
inferred resource of 30.75Mt @ 6.5% Pb, 106g/t Ag (3% Pb cutoff grade), and 11Mt @ 1.6% Cu and 0.8g/t Au. [equating to
2Mt Pb metal, 104.9 Moz Ag, 170,000t Cu & 300,000oz Au] here often on the thread, trying to make investment decisions around this resource estimate in conjunction the project update from the same release : "(the) Scoping Study together with the down-plunge geological potential provide a strong economic and geological case for further infill and step-out exploration drilling as a pre-requisite to firming up mining plans. Recent silver and lead price increases, if maintained, will enhance the projects short term development potential."
The 08/03/16 Mining Scoping Study release gave "strong impetus to the project" whilst holding back specific economic estimates such as production targets or financial forecasts derived from that data obtained in the study. However, those estimated capital expenditure and operating costs
do exist using assumed figures typical of ore processing in that North Queensland area that gave cause for "strong positive cash flows" potential for both project options investigated in the study (off site trucking, or stand-alone mining).
Although the scoping study lacked specific figures, and RDM was singled out and commended for this scoping study on that basis
here ... where does that leave investors in assessing Maronan as an RDM asset?
Over the weekend I looked at listed company PNX Metals, (formerly Phoenix Copper) code PNX.AX, market cap of ~$9.5 M.
Stated by the company to be in possession of a "near surface, high grade deposit", PNX's Hayes Creek project is : 2.81Mt at 5.02% zinc, 2.11g/t gold, 143g/t silver, 1.17% lead, and 0.3% copper - and exists over two locations 3km apart. I am not interested in rehashing the PNX mining scoping study here (it is available
here as a PNX release), but the combined open pit and underground mining scenario that was released presents a depth of estimate that has $ costs for open pit and underground costs per tonne of mined ore along many other mining estimates for the deposit:
-7 yrs of mine life
- upfront capital costs to commence production of first concentrate from Mt Bonnie open pit ore is estimated at $54 million. Development of the underground operation at Iron Blow will commence late in the first year of full production and is estimated to require $10.9 million of capital to reach first ore with no additional processing capital requirements beyond normal sustaining capital
-Life of mine revenue (net of Treatment and Refining charges of $58.7 million, or $20.89 tonne of ore) is estimated at $631 million, split between zinc - $259 million (41%), silver - $214 million (34%), and gold - $158 million (25%)
-project pre-tax Net Present Value (NPV), at a nominal 10% discount rate, is $109.4 million.
-The Project Internal Rate of Return (IRR) is 58%, reflected in the 1.8 year period to payback upfront capital costs
Are these figures to be taken with an huge grain of salt? possibly... I am not familiar enough with PNX to make that call, I am far more familiar with what we have going at Maronan.
The above isn't a comment on PNX, just food for thought in as much as we are able to slightly compare the two potential operations whilst both are of "low confidence level" and far from identical.
NOTE: Hayes Creek has technical components of a Pre-Feasibility Study (PFS) now fully-funded after the Company secured $1.6 million via the signing of two agreements for the forward sale of silver from the Project (08/06/2016 Market Release).
(20min delay)