I'm more accustomed to investing in gold stocks. I bought my first tranche of RVR when zinc was $0.97/lb. Today it's $1.25/lb. To give a gold analogy, that's like today's gold price increasing from $1200/oz to $1500/oz. If gold did that, every gold junior would have their SP go ballistic. I think there are less bees around the honey pot here, and with a couple of CRs there is some overhang to deal with. But at the end of the day there must be a revaluation when RVR becomes a producer. And I have a strong expectation that the Zn price will continue to appreciate. Lowest smelting charges on record at refineries in China in December. That means a significant shortage of concentrate. Inventories of concentrate at smelters are at record lows - 2 weeks supply only. This time last year it was three months supply. No sign of Glencore turning supply back on.
Yes there are things that can go wrong. The plant might strike unforeseen issues and be more costly to restart than initially estimated. There could be issues with the mines or the mining contractor. But on a risk adjusted basis it seems like a very good proposition to me. Really asymmetric. And management with experience and skin in the game should minimise these possibilities.
And as many have posted on these threads, there are plenty of things that can go right too. The last drilling result at Far West was not factored into previous calculations, I'm sure. Who knows what size Liontown East will be once it's been thoroughly drilled? Plenty more targets for future drilling also.
Cheers,
Tim.
RVR Price at posting:
22.0¢ Sentiment: Buy Disclosure: Held
