As many of us having been saying since the very first their forecasts of recovery were overly optimistic. Simple logic says if it was so easy to make such a large amount of money out of a known resource with all the capital in place then why did MMG walk away? The idea that a couple of blokes from Collins St knew better is silly. To release the zinc that wasn't liberated the first time around requires a regrind. Regrinding costs money. If it didn't they would just regrind it to atoms and announce an amazing recovery rate.
The things that Blake Stone has pointed out I hadn't even considered because in my opinion this was dead in the water at recovery. But everything he points out is true with regards to the water balance in to the mill. There's no way it can work.
If you take in to account that treatment charges are well in to the $300's and zinc prices are super low the maths says they can hardly afford the corporate overheads let alone make a profit. In regards to Equaliser'a comment that $100m must be found within a month I don't even think this will help. It will keep the door open so they can pay themselves a but longer but no amount of money will solve the underlying flaws in this project.
The only hope was upside from the other exploration licenses but at the moment that's all there is. There are plenty of other explorers out their with good licenses and much lower market caps.
This thing can't stay at $130m market cap. Expect it to halve by Christmas.
NCZ Price at posting:
24.5¢ Sentiment: Sell Disclosure: Not Held
