The thing is I think number 1 is more of a stick than a carrot. Currently it is a 2.5mtpa copper concentrator that would sit there and do nothing but cost them $1m per month, plus the eventual rehab liability of god knows what.
Number 2 is attractive, but not if you have the anchor of number 1. Even if you discover a resource in number 2 that is economic, how much money have you poured into continuing to maintain number 1? They haven't even discovered a resource yet, so even if they have a discovery it will be years before it would be drilled out to the point where they can make a decision to mine. Why pay C&M for 3-5 years for some old infrastructure that may be a couple of hundred km's away from whatever you may find out there?
Nobody would buy Nifty unless they believed they could run it profitably based on the resources in the Nifty tenement, with the hope that they find something else in the exploration ground. Otherwise you are better off just taking the exploration ground and in the end if you make an economic discovery then you build a new plant, optimised to the ore you have to process, at the optimal throughput. Better economics
MLX Price at posting:
8.4¢ Sentiment: Hold Disclosure: Held
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