PMY - SILVER INVESTORS DREAM at start of BULL RUN, page-405

@Verily1
taken literally you could - but that pfs number was too low for me to feel it was realistic. i started from there but expanded it to be in line with the output levels my optimised concept called for - based on my experience. ie So i opted to use $125m but have that represent PMY's 75% share not 100%

the point of what I was doing isnt to mirror the company specific study outcome. Only their detailed process can do that

its to use a standardised approach to evaluate one project's likely economic potential/returns vs anothers before you know what a DFS shows - using relativities ive historically found to be broadly true - for a given value of truth.

the more conservative the assumptions the better it makes the probability of the analysis being correct in a relative sense - ie picking the right stock

companies tend to understate the capital demands in docs - real life inflation tends to take its cut - esp as few mines get funded during a bear market.

when bull market comes the engineers up their prices. they are notoriously greedy in bull markets because its slim pickings during a bear

companies also tend to put up understated/non optimal output targets in bear markets - because its based on bear market metal price assumptions

the 2 things i dont generally question are resource and met

but for eg if PMY had their druthers theyd probably ask me to drop the zinc. But my feeling is it should be recoverable at similar levels to the lead - the question is whether the extra capex to do so is justified

similarly IVR would probably tell you a small operation could be done for $60-70m. After all its notionally half the size. - but I dont think so because that resource has 3 different geochemical zones - meaning they likely need extra processing circuits

im not trying to be right in an absolute sense

im trying to be right in a relative sense of picking the project most likely to offer best commercial returns - before theyve said what they are

behind all this is that I havent seen any commercial mines built for less than $100m in a long time. refurbs sure. but not new mines

every company i saw say they could in past ~10yr seemed to fall over. have a look at MOY and TRY as examples

im sure there are some that have. I just dont know of them - its a wide wide world out there.

until a DFS is out - i dont take any study outcomes at 100% face value - and not even when a DFS comes out sometimes

this is what i was doing ~5 months ago with some adjustments to my thinking as time has passed.

Im just outlining it now as i thought it might be of interest as more people look at the stock now we're shifting from bear to bull