AGM 0.00% $1.60 australian governance & ethical index fund

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  1. 88 Posts.
    Aspect Huntleys view on AGM:

    Resources total 158,000t of nickel grading 0.97% at a 0.4% cutoff. The grade compares unfavourably to Kambalda miners like Sally Malay and Mincor where grades are typically 2-3%.


    Impact

    Our initial AGM valuation is $640m or 80c a share fully diluted. This assumes long term US$10.00/lb nickel, an A$/US$ exchange rate of 0.80 and a 10% discount rate. It incorporates expected of exploration success. We include the mooted expansion to 1.5Mt from FY10 forecast life to 2020 based on mining 110% of resources.

    Low grades suggest reaching estimated cash costs of US$3.00/lb will be problematic. Mining and milling costs will need to be about one-third of the Kambalda miners per tonne
 
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