Hmmm, the term strategy, by definition, is long term in nature....

Hmmm, the term strategy, by definition, is long term in nature. Therefore, to contemplate any assessment by Xstrata based purely on the financial and geological outcomes of the Garatau BFS (no matter how positive) is somewhat misleading and only half the story.
What Xstrata will do, is assess the outcomes of this (what i'll call upper cap BFS, in the sense that it appears to include the upper range of cost outcomes which are still going through optimisation) and compare it to what it has already worked out for itself in terms of the project economics.
Let's have a look at what's changed in the BFS when compared to the initial assessment of Garatau and assume that the same will hold true for Tubatse. All that changed was a slight decrease in grade of extraction and an actual decrease in operating costs. Life of mine is 40 year plus with an essential 9moz contingency of inferred production, which seems a safe bet to say that 50years will be achieved.
So, for the purposes of independence, i wont include my figures, as they simply introduce another set of financials to this thread. I refer back to Edison's Research, which proposed a DCF of $3.55 per share for NKP on a fully diluted basis of 634m shares. I, personally, come up with a 25% premium to that figure and i consider my assumptions to be conservative also, but as I said thats merely another set of numbers.
I actually think your post of: #5020957 was on the right track and positive on the outcomes but you seem to have changed your thought process mid-way in direct response to certain posters. Perhaps its just my interpretation.
In any case you also stated
1.the discount rate is the host company cost of funding of debt & equity blended together. I agree

2.NPV is the "best" outcome based on the assumptions used. I agree

3. you then devalue the resultant NPV based on the hurldes still required to get the project to full production, to come up with the EV. This is why NKP is in the 40 cent bracket. RISK adjusted. I would have to disagree as you cant have it both ways to suggest that if the assumptions agreed to for the NPV hold true you would still need to factor in such a savage risk adjustment again at this point to derive the Enterprise Value.

Also you mentioned that:
And those assumptions would have been based on the "preferred" mine layout, logistics, as determined by the engineers. I would expect that the costs published by NKP did not use a "blended" cost for the various possible ways of mining the ore
I think they have already stated that they are currently going through optimised view which will see cost containment further enhanced so their preliminary BFS I would say is a classical model, for sake of a better term, to be in a position to inform the market now rather than final as you suggested. I dont hink that point would be open to serious rebuttable as it is clearly stated in their announcement.

I said i wouldnt enter the room again until after Xstrata has made a decision, but I was bored and doing other research, so thought what the hell. Oh yeah, just so there is no confusion, this is not a disagreement with you Homebrand, as for the most part I think your arguments offer some rational counter-thought. Im merely doing the same.

Thats it...............im gone