RE: LBE vs ISMaatozz feels a need to post on this forum, to pump the stock of her choice. Nickel77 took the time to respond to the convoluted calculations. I'll paste a comparative of the two methods. Those familiar with the reality of converting estimated resources through to revenue from sales, and some of the economic reports done to NI 43-101 standards, will quickly notice that Nickel77's approach is rational, and can see the weaknesses in the efforts of our amateur hour forecaster.
Nickel77 took the time to set out a response to Judy's convoluted mining profit demonstration, and Nickel77 set it out in a format that indicates an understanding of the issues, and one in which Judy could respond to the differences, if she was so moved. Judy doesn't seem to discuss the differences between her effort, and that of Nickel77's. I wonder why? Let's have a look at some of the differences. Reminiscent of Judy's first effort when she assumed there was no tonnages losses from in situ to saleable. This go round Judy, having been shown as completely ignorant on the subject, has again been
very optimistic (that's a kind way of saying completely unrealistic) on the ease with which indicated resources become net smelter revenue. Lets compare the two models, and maybe someone familiar with the mining process could discuss the realities with Judy. Maybe Judy could start the conversation by explaining the reasoning behind the bolded items.
One thing that's evident, is Judy meets all the requirements of the ISM pumper. Like Darcel and drillbit, she's out by a factor of ten (likely more!)
| | | Nickel77 | Judy | Judy |
| | | L2 | L2 | L1 and L2 |
| Tonnes in resource | | 8,324,000 | 8,324,000 | 10,000,000 |
| Expected reserves % | | 60.00% | 100.00% | 100.00% |
| Expected reserves | | 4,994,400 | 8,324,000 | 10,000,000 |
| Average grade | | 0.40% | 0.400% | 0.419% |
| Metallurgical recovery | | 55.00% | 80.40% | 80.40% |
| Smelter accountability | | 75.00% | 100.00% | 100.00% |
| Price of Ni per pound | | $8.00 | $7.00 | $7.00 |
| Net Smelter Revenue | | $145,367,006 | $413,220,048 | $520,000,000 |
| Pit cost per tonne | | $4.50 | $4.56 | $4.56 |
| Underground cost per tonne | | $35.00 |
.00 |
.00 |
| G&A | A | $3.50 |
.00 |
.00 |
| Milling cost per tonne | B | $16.00 |
.00 |
.00 |
| Environmental cost per tonne | C | $1.50 |
.00 |
.00 |
| G&A, milling, environmental | A+B+C | $21.00 | $25.00 | $25.00 |
| Tonnes in constrained pit | | 2,000,000 | 8,324,000 | 10,000,000 |
| Total mine and mill costs | | $218,686,400 | $246,057,440 | $295,600,000 |
| Cash flow before taxes | | -$73,319,394 | $167,162,608 | $224,400,000 |
| Taxes | | 32.00% | 31.82% | 31.82% |
| Earnings | | -$73,319,394 | $113,974,505 | $153,000,000 |
| | | | | |
| Note: if there were no pit constraints | | | | |
| Mine & mill costs would be | | $127,357,200 | $246,057,440 | $295,600,000 |
| Cash flow before taxes | | $18,009,806 | $167,162,608 | $224,400,000 |
| Taxes | | 32.00% | 31.82% | 31.82% |
| Earnings | | $12,246,668 | $113,974,505 | $153,000,000 |
| | | | | |
| Capital costs | | | | |
| Mill on site | | $60,000,000 |
|
|
| Mine development | | $50,000,000 |
|
|
| Equipment | | $10,000,000 |
|
|
| Total | | $120,000,000 |
|
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