C1 figure for copper after adjusting for gold credits: SFR per pound of copper 1.28 Ozl per pound of copper 1.56 Ozl's costs are 22% higher than SFR!!
OZl's copper costs will rise rapidly as it goes underground.
Per Crdit Suisse Research Report:
While mine life extension appears likely, an open-pit resource needs to be discovered to provide base load for the 10mtpa mill. An underground mining rate cannot yet be speculated, but feeding half the mill capacity would be an optimistic outcome. The shape of the ore body suggests that sub-level open stoping may be more likely than lower-cost, more productive caving methods.
Any reduction in mill tonnage has implications for unit milling costs and fixed site administration cost allocation. Underground grades appear to be 1.2-1.4% copper, a little higher than the current pit grade, but not sufficient to offset likely higher unit costs.
OZL Price at posting:
$14.65 Sentiment: Sell Disclosure: Not Held
