@ Discoveryman. A typical offtake agreement includes the price...

@ Discoveryman. A typical offtake agreement includes the price at the time of delivery, normally with a large percentage paid upon delivery, with the balance paid once the exact assays of the concentrate delivered is know. Delivery can be agreed as at-gate, free on board (FOB), or at a harbour close to where the offtaker wants it (CIF). Further terms agreed are minimum specifications beyond which the offtaker can reject or impose penalties, amount payable for certain metals at a particular grade with minimum deductions, penalty elements and penalty levels, credits for certain elements and levels beyond which this is applicable.

The importance of having an offtake agreement is that it is an indication that an other party has sufficient trust in the project to commit itself to reserve a portion of its treatment capacity for it.

To agree to a fixed price is unusual, but sometimes imposed by the financier(s) to minimise their risk against the project not being able to pay off their debt should the metal prices take a downward turn. Given the very high grade at Rupice in the early years, this risk is virtually non-existent for ADT.