RE:New to this boardNegatives
1. Alot of ounces are still in the inferred category or what I like to call pretend ounces as they are not really their until they do more infill drilling.
2. It is a PEA which by definition is very preliminary
3. The project economics using base case scenario are not that good!
- The payback period is almost half the length of the mine life. Between 4 and 5 years for a 10 year mine life. Generally speaking that sucks should be no more than 2.5 years with such a short mine life. So they need to expand the in pit resource to extend the life greater than 12 years!
- The IRR is OK at base case but really not all that good! I have not seen the full PEA yet but suspect the total costs to be in the $1200 and ounce range.
4. Typically, PEA's assume 100% equity financing! In other words debt and debt financing is not included. Again will have to pour through the PEA to be sure.
5. Higher risk given country and infastructure!
So higher gold prices will be good for this one as it is leveredged to price. On the other hand until it progresses with more drilling and a PFS it will likely head down to the .50 level should gold prices be flat!
Just one mans opinion!