RE: Duck Pond TodayToo busy watching the Suns/Mavs game to compare our numbers, but my earlier post is a bit easier to follow on Duck Pond:
"Just read the info on Duck Pond: Firstly, it reminded me that AUR grabbed the property from Falconbridge and that AUR will ONLY be responsible for paying Falconbridge a 2% NSR (after paying 3 million bucks on start up). I wonder if Falconbridge or whomever ends up acquiring Falconbridge might not one day want the whole project when they see the cashflow the project generates (upwards of US$150 million/year for between 8 to 12 years IMHO). As for the project:
-Duck Pond is expected to produce about 41 million pounds of copper, 76 million pounds of zinc, 536,000 oz of silver and 4,000 oz of gold a year during its expected life. I would argue that its mine life will be far greater than believed as AUR was using a figure of 50 cent zinc, $5 silver, and $275 gold to determine its viability (The increased prices in silver and gold alone add about $5 million year to the bottom line to say nothing for lead (that's Campine's).
- As for costs per pound, it is 41 cents/pound using an average zinc price of 72 cents for a full year production of 76 million pounds of zinc. Of course, if we extrapolate and only look at 3/4 of that as hedged at the average of 72 cents and give the other 1/4 the spot price of say $1.42/pound and if we use current spot prices for gold and silver (based on an assumption that the cost per pound calculation relates to feasibility study figures of $5 silver and $275 gold) I come up with an additional $13.3 million from zinc plus another 5.6 million from gold and silver for a total of about US$19 million added to by-product credits (I add nothing for the increase in lead as those figures are not presented). Dispersing that 19 million over 41 million pounds of copper a year I get an additional credit of 46 cents/pound which, when subtracted from the estimate of 41 cents/pound, makes Duck Pond a less than zero cents/pound producer of copper (minus 5 cents/pound). At a copper price of $3.35/pound I get $3.40/pound from Duck Pond multiplied by 41 million pounds for a figure of US$139 million or about CAN$160 million or about $1.65/share. How's that?"