Hey all, like many, I watch/hold other stocks in the sector.
One announcement that I felt was particularly pertinent to BDC this week, was another stock (CAI), securing debt funding for their plant build, which will basically commence in the June Q next year (so closish to what BDC hopes for).
CAID project has a total capex (including pre-production) of $120m. New plant, strip the main pit, fill the ROM pad, get the plant running.
They were able to secure debt facility of $110m AUD.....
Calidus secures debt funding
I was surprised they were able to achieve this amount, they already have approx $25m in cash (but... a recent acquisition will cost them $15m), so for all intensive purposes, they have $10m right now. Very close to being fully funded (perhaps 90%). I hold CAI, I like them.
They hedging was also not particularly erroneous.
However, compared to BDC, their reserves and production profile are smaller than BDC by perhaps 30%.
BDC is going to have a lower payable due to their product and sales, but... that should only reduce the overall projects profitability by perhaps 5%.
I know BDC is saying they are aiming for 60/40 debt/equity, but I do have to wonder, if they could indeed swing that a little more in favor of increased debt.
I guess above all, I find what CAI has been able to achieve, as a overall positive, for BDC going forward. CAI had a large number of financers make offers to them... lots of money is wanting to fund development projects (good ones). BDC is going to have close to double CAIs reserves when the DFS comes out. Again, this must enable the board to bargain quite hard.
CAI and BDC have different projects in some ways, but... obviously, they are both gold projects etc.
Looking forward to the next few months. BDC has lots of room to move.
