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Karora Resources Inc T.KRR

Alternate Symbol(s):  KRRGF

Karora Resources Inc. is a Canada-based multi-asset mineral resource company. The Company’s portfolio includes the Beta Hunt Underground Mine, Higginsville Gold Operations and Lakewood Mill. It owns 100% of Beta Hunt, a gold-producing mine located approximately 600 kilometers from Perth in Kambalda, Western Australia. It owns and operates HGO, which is located approximately 75 kilometers south of the Beta Hunt Mine in Higginsville, Western Australia. HGO has a mineral gold resource and reserve and prospective land package totaling approximately 1,900 square kilometers. The operation includes a 1.6 million tons per annum (Mtpa) processing plant, 192 mining tenements, including the Aquarius, Hidden Secret, Mousehollow, Two Boys, Baloo, Pioneer, Fairplay North, Mitchell, Wills, Challenge and Mount Henry deposits. The Lakewood Gold Mill is located just outside Kalgoorlie, Western Australia and approximately 60 kilometers from the Beta Hunt Mine, has a processing capacity of 1.0 Mtpa.


TSX:KRR - Post by User

Post by Farquaron Mar 06, 2022 9:34pm
230 Views
Post# 34488903

17 months to build the 2nd ramp and upgrade mill

17 months to build the 2nd ramp and upgrade millI was checking out Karora's latest presentation.. It shows a graph demonstrating the projected window of time to complete not only the new ramp but also the mill upgrade to 2.5 million tons/yr. It shows both major projects being started January /2022 and both completed by around May/2023.. Thats about 17 months...but Let's say that they complete everything by late June and call it 18 months or 6 quarters....Huet mentioned it would cost approximately 90 million $cdn to pay for the two projects..But with all this inflation impacting the cost of everything, let's say 100 million $ cdn instead.....So 100 6 quarters = $16,666,666.66 cdn per quarter...So let's call it 16.67 million$ per quarter... This Q1 will be over in about 3 weeks...(We know that the costs associated with these 2 projects are not going to be exactly 16.67 mil per quarter as some quarters might see them spending alot more depending on what phase of the projects they're in or not ) but for the sake of argument I'll stick to 16.67 mil...So, as of April 1st/2022, in theory Karora will have only $83.3 million cdn left to pay for the 2 projects, by July 1st, it will be down to about 66.6 million cdn ...etc.etc. They also have budgeted 20-23 million $ cdn for drilling in 2022 which is 5 to 5.7 mil per quarter for exploration which means combined with the capex for the 2 projects, they will be spending about 22- 22.5 million cdn on all these things.. This 22.5 million should easily be paid for from the gross profits and free cash flow they will be generating each quarter in 2022 and 2023.. In other words, they should not even need to dip into their 90 million $ cash reserves unless they have a whopping upfront cost to pay for, but all in all , these projects should be easily funded and not impact their bank account as time elapses.. As each successful quarter sees krr reduce and eat away at their long-term costs associated with these projects, the more likely they will finally get that new credit facility without a gold price hedge attached to it...As the banks will feel better lending to Krr as they become less and less of a credit risk to them because of continual trustworthy ,reliable meeting of financial obligations by karora... It would be a great day if and when Karora can acquire a new line of credit of let's say 100,000,000.00 cdn at a very low interest rate and with no gold sale hedges!! Imagine what Huet could do with 90 million in cash and growing and 100 million in credit to borrow from to buy out stuff? My goodness...They could buy some more prospective nickel and gold properties in the area, they could perhaps buy out Northern Star's 1.3 million ton/yr Jubilee mill which is about 10 kms north of Spargos and Beta Hunt... Northern Star paid about 72 million $ cdn for the mill and 4 million ounce gold land package from the previous owners : Westgold.....Maybe Northern Star would sell the mill and land for under 100 million$ cdn to Karora of which Krr would be able to pay cash for by then ... I think, Huet wants that mill.. He hired a former Northern Star board member to join Krr's board in Shirley in't (international house of pancakes) Velt to hopefully facilitate that aim....There's also the money from a dumont sale that could instantaneously fatten up their bank account to the tune of 35 million $ or so.....This year should see Krr make some interesting moves....Each month that goes by, sees krr de-risking their operations...but also perhaps being able to make incredible shareholder accretive big moves that could send the share price rocketing higher ...Should be an interesting rest of the year...
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