RE:RE:Goldman Sachs: “Green Metals: Copper is the new oil”
I Posted This September 18th, 2019 bases on those values at that time. Yes, i would think I'm using consevative resource amounts with Kwanika/Stardust merger!
Kwanika Open Pit Concept for First 5 years
2017 Preliminary Economic Assessment Highlights
Annual metal production of 50.4 million pounds of copper, 70,100 ounces of gold, Initial capital cost of CDN $476 for a 15,000 tpd (5.4 million tpa) mill and combined open pit, underground mining operation.Direct cash cost of production per pound of copper net of gold, US$1.20/lb Life of MineMetallurgical yield 91% copper, 75% gold.
Kwanika NI 43-101 Update 2019 Highlights
The Measured and Indicated (M&I) Mineral Resource is estimated to contain:
1.32 billion lbs of Cu, of which 500 million is in the open pit = 100 million/yr
1.83 million oz of Au of which 700,000 is in the open pit = 140,000/yr
Identification of higher-grade domains within the open pit has doubled the annual metal production, which will form the basis for PFS mine planning
Convert to Canadian Currency.
US$1.20 = $1.59 Cdn, , cash cost of production per pound of copper, net of gold
Price of Copper - US$2.62/lb = $3.48 Cdn/lb
Gold - US $1500/oz = $1,975 Cdn/oz
100 million pounds of copper/year x ($3.48 - $1.59) x 91% yield = $172 Million/year
140,000 oz of gold/year x $1,975 x 75% yield = $207 Million/ year
Total of net $379 million/year
Project Financing
Capital Costs of $476 Million, including underground now can be updated to an Open Pit 5 year plan to approximately $350 Million and defer underground costs according to the new resource estimate.
$350 Million/5yrs = $70 Million/yr + 10% Interest = $77 Million/yr the cost of borrowing
Summary for 5 year Open Pit
According to my calculations, a total of $379 million/yr minus the cost of borrowing of $77 million/yr is approximately $300 million Profit per year for 5 years is $1.5 Billion Profit
Also, the balance of 800 million lbs of copper and 1.13million oz of gold still remain in the underground which would generate approximately another $2.2 billion net, minus the cost of Approximately $126 Million for underground costs will also be Approx. $2 Billion Profit.