Recent Gold M&A in Australia - Big Premiums on Acquisitions, page-48

Hi Shines,

I'm being conservative and only taking 20 of the 33Mt resource as not all of it will be convertible and a large portion is in lower confidence ranges etc.

A question I asked myself...."What savings $/OZ would Telfer generate from processing higher grade Minyari Ore?
Suggested answer = $420/Oz, as such if Telfer paid this they would be acquiring it for zero incremental cost.
$250/Oz should be a no brainer

Here is my logic....

Telfer needs to process 66 tonnes from the West Dome to produce 1 Oz of gold.
With Minyari ore they would only need about 15 assuming a 2.4g/t head grade.
That's a massive 50 tonne reduction in processing to produce 1 Oz of gold, at $12.90/milling cost this is $650/Oz saving.

Assume similar pre strip and mining costs for Minyari to West Dome (I don't have any basis for this one)
Apply $15/t toll costs (seems right for the distance), = $230/Oz

$650-230 = A$420 an Oz in total savings from displacing West Dome ore with Minyari Ore.
For directional purposes it is clear there should be a attractive value proposition to all parties.

In addition, more ounces for the same amount of power, which means on a tCO2/Oz basis, their metrics would improve....this is 10% of the executive teams STI bonus rating....

If I was at NCM and looking at this, I would make a move before the scoping study came out while prices are somewhat depressed.......I think I've talked myself into buying more AZY...