Updated BFS, page-104

Having worked in Zinc concentrates, the price structure is based on incentives.

A smelter works with small margins, generally 5 to 10%. As a consequence, they earn money through a treatment charge, a price paid by the miner to process their material. This TC is a benchmark decided on a yearly basis by the leading smelters, in addition to a spot TC. The 15% is essentially "free metal" which is an additional incentive to process the metal. Within this you have price escalators and de-escalator depending if the purchaser / buyer think that the price is in contango (future spot price is higher) or backwardation (future spot is lower). You have also penalties on impurities etc. The lower the Zinc price, the lower the TC because the miner is earning less money for every MT of mined material and they need an incentive to continue mining.

The main reason why the IBG never took off between 2008 and 2020, is that zinc prices has never retuned to the highs of 2007 (4450 per /mt), around the time that IBG started. The zinc price crashed to 1121 per / mt in 2009, and has been below 2500 per / mt during the 2010 to 2020. Most established mines struggle to make money between 1500 to 2000 per / mt. As a consequence, I suspect that is why this project went no where.

However, there was always an narrative regarding the "super cycle" for zinc will return. This goldilock zone is what IBG needs to move forward. They probably need a zinc price of 3k plus to make the project a viable concern. Moreover, most the concentrate mines are at mid to end of life, so you have 2 options now you can either re-open moth balled mines or invest in new projects. The reason I invested in IBG, is that I calculated the latter.