RE:RE:RE:RE:RE:RE:TREVALI EXTENDS ZINC HEDGING PROGRAM OUT TO END OF 2021The high cost of Caribou production was caused by the geotechnical issue, and the mill didn't have enough feed.
When bluenote ran the mine, the mill recovery was low, as a result high cost.
What I see the management will do two things before deciding to re-start:
1 Hedge 25% more zinc production or whole Caribout's production, so the revenue will be guaranteed;
2 Make sure to have enough feed for the mill or trucking ore from other properties nearby.
If Zinc is still at the current price between 1.20 to 1.30, then Carobou is a go.
tiger
kramaswamy wrote: You might be right, but I feel it's a bit too much of a gamble to be worthwhile.
Remember that starting up and shutting down a mine isn't free; if they decided to resume production at Caribou, and zinc price started falling, they'd get hit on both ends.
My expectation is that they'll only restart Caribou if zinc spot shows signs of remaining above $1.25 for at least a few years, or, if they could guarantee spot sale from Caribou for several years.