Jetjono you asked 2 questions - my take on the g/t and approx costs to recover gold. They are obviously inherently intertwined.
They are also total guesses until the company is in a position to release what they think noting that they cant without JORC say such things to the ASX. All they can do (announce) legally is what they got, not what they project. They can project costs per tonne but not grams per tonne matched to that.
However going on what I think and this is not at all actually what they thing IMO and perhaps modified between what I think the GMA/WMC guys got in the 60's (the old timers cost and g/t structure from 100years ago is completely irrelevant.
1. g/t: For nuggety VIC deposits and this one in particular there is always definitely an uplift between drilled grades and mined grades (not considering mining dilution) aka the uplift in real insitu grade as Vs drilled grade because drilling has a much higher probability of missing a nugget than hitting it. Also historical 1960s mining showed that was the case and the old 1mt JORC relied on that. So assuming that the increase in gold price since the 60's equals roughly the increase in costs as a basic start point, lets assume that what they got then is what we need now to roughly make money. So we think here on the forum that we want a 15g/t head grade fed from the mine to the plant (the plant head grade and the Run of Mine ROM grade). Assume a 50% dilution overall (low grade development material (not ore as not JORC) high grade development materian plus actual retreat mining vein material). Thus one would need 30g/t insitu, which possibly means a 10 - 15g/t drilled grade? See how many assumptions there are already and why everyone should take a breath, await the mine to announce all these things when they have enough consistent data aka after 3 months mining.
2. Costs as you would note from the lead in from the g/t discussion are complex. Think of it the other way (aka this is a zero based build up from mining to haulage to process costs, but what is our target? Gold price is currently in a US$1200 - US$1400/oz range being held probably by the global control fight between China and US and central bank sales driving broker speculation. If we assume the A$ will keep that at say a AU$1600 - AU$1900/oz range so lets say gold is A$1600/oz. Say the mien and plant could operate at 50,000t/yr (the 80,000t/yr nameplate is a furphy because its real capability is based on how much hard dilution it deals with so its all about grams put through, not tonnes. Anyway assume we could put 50,000t/yr through at 15g/t at 80% overall (gravity to site dore plus offsite sulphide recovery) thats 50,000 x 15 x 0.8 = 600,000g / 31 = around 20,000oz x $1600 = $32million revenue. If AISC (including all corporate costs) was $1000/oz the cost would be $20mill. Assume this year of the remaining $12mill we pay no tax due to tax loss forwards. So $12m /billions of shares??
So, we know nothing of all this but the Qtr Cashflow will provide all costs spent in the relevant Qtr and as the mine has already been built there are no upfront capital costs so the AISC (all costs beyond initial captal) will equal what they announce.
So when the Qtr rpts come out, one will give us the total ounces produced and sold and the revenue and the other will give us the costs. Revenue minus costs = cashflow and one can then divine by oz sold to get some numbers relevant to your question.
But the real takeout from various of my posts is that the VIC ops and especially MStar rely for success on minimised drilling costs and decisions to mine a defined area for say 3 months and then look back at the average result from that area - because the nugget effect means some weeks you mine for low gold at a loss and others you mine ultra high grade for windfall profit.
If you really want to help AUL and the team get to profit and then major profit you need to just watch the quarterlies and let them mine the 3 months without bombarding them and this forum with day by day questions. This mine must run in 3 month chunks, its NOT a daily cashflow mindset.
Do you now trust the team - have they consistently and more importantly carefully in a staged manner got to each next step.
I do and I have no reason to be positive to them due to the history between us but they are professional as Vs a few other similar companies that come to mind (both in admin right now) who tried the same stuff (one next door and one in Sth Am).
Finally to get back to your question, without zero based buildup, I aimed for a A$1000/oz AISC from this mine underground.
If the mine feeds the plant mainly quartz hosted gold with minimal hard diorite dyke dilution, then the plant should look for 15g/t feed to return about $10m free cash per annum as a starting minimum.
If an ore sorter ($1m was installed first n surface and later underground, and if they found reefs at drilled 5g/t, then they could end up mining 15g/t or greater, diluted down at the face with host rock to 10g/t and then sorted up to maybe 30g/t to put to the plant.
30g/t to plant at 80,000t/yr at 85% recovery at AISC $1000/oz = (30 x 80,000 x .85 x (1600 - 1000))/31 = $40mill EBITDA
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