To expand on the possible significance of the updated met...

To expand on the possible significance of the updated met test-work that should be due shortly. If you were to rationalise the recent SP in this way:

- Using the 2Mtpa scoping (e.g. 5.8% concentrate)

- Assume an eventual 5Mtpa operation (1.1Mtpa concentrate)

- All-in sustaining costs of US$297/t (no discount for the 2.5x larger operation)

- Base-case concentrate sale price of US$644/t (US$920/t -30%)

- Current exchange rate of 0.72

- 60% stake

- P/E ratio of 5 (very low, especially considering Manono's potential 100+ year mine life)

- Risk discount of 89% (to make the maths work - location, government, future dilution, etc)

- Fully diluted (2.393bn shares)

You get a SP of 7.3c. The maths:

1.1Mtpa concentrate x (US$644/t - US$297/t) / 0.72 exchange x 60% stake x PE 5 x (100% - 89% discount) / 2.393bn shares

If AVZ can produce a 6.3% concentrate and you apply the same equation to the extra US$75/t, then you get an extra 1.6c per share.

The above could be seen as a bit of pointless exercise, but it's worthwhile tweaking the inputs to your own expectations and reminding yourself of what you think this project is worth.

It is the risk discount that makes the biggest difference - which is a mostly subjective number - but if you stick with the 89% and use, for example, the scoping study's US$920/t sale price and a probably more realistic P/E ratio of 10, then you still get a very different outcome.