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03boz

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17/03/18

19:44

Post #: 31831243
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Originally posted by blister ↑

hey mate, welcome aboard. thats a tough question. ill work it this way to achieve 10c wed need an MC of 170million. lets assume a market multiplier for resources is x10... then we'd need to generate 17 million in bullion sales profit per year. the reason why this is at .007c is there is no jorc and no aisc... which would be laid out in a dfs which we dont have as a cost saving exercise as they have all the infrastructure they need so no need to shop around for capex investors. it was previously estimated morningstar was 910,000 ounces at 11.6 g/t...but we are driving a different approach

the best aisc ive seen recently are $900 an ounce. At $1600 oz AUDZ lets be generous and say $1000oz aisc given its pretty artisenal with targeted drilling. so to achieve 10c theyd need to produce 28,000oz annually. scale that to get 7c, 5c, 3c, etc. can they do this?

they have a 80,000 ton per annum processing plant which youd assume would be at capacity... now we have to assume an average grade 10 g/t. getting us a total output of 80,000 ounces per year... so a little over twice our 10c estimation. so at full capacity, with assumed aisc of $1,000... they could pump out to 20c... all subject to a change of any input data.

heres the reason we are so low, its all guess work til they actually start producing.

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Great analysis there Blister.
I would like to add that IMO there is a very low chance of a Jorc drilling program at RoD and MS. A Jorc drilling program would be totally cost prohibitive at RoD and MS due to the structure of the resource.
If your sitting back waiting for a Jorc resource from AUL, well, IMO your going to miss the boat.

Last edited by 03boz: 17/03/18

AUL Price at posting: 0.7¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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