Woulfe Mining Corp WFEMF

RE: RE: RE: Define 170/mtu break even

[Flow23]

Junior_miner, have you read the Valuation Report from Aug. 2011? Interesting read with some more realistic numbers than the scoping study. Available at Woulfe homepage --> Milestone documents

With 375$/mtu: 575 Mil.$

With 400$/mtu: 649 Mil.$

With 450$/mtu: 798Mil.$

with following parameters

• underground mining, with decline access
• mine production rate of 1,200,000 tonnes per year
• mine operating life of 21 years
• average mill feed grade of 0.41% WO3, with 0.45% WO3 (and 0.04% MoS2) in the first 4.5 years, and then 0.40% WO3 (and 0.04% MoS2) for the next 16.5 years9
• commencement of production in 2013
• WO3 recovery of 81% to concentrate and MoS2 recovery of 85% to concentrate
• 96% recovery of WO3 from concentrate to APT (containing 89% WO3)
• APT conversion cost of $20 per metric tonne unit of WO3
• conversion of MoS2 to MoO3 at a cost of US$1.50 per pound of Mo
• a long-term constant-dollar WO3 price of US$375 per metric tonne unit, and a long-term molybdenum price of US$1511 per pound of molybdenum contained in MoO3
•  royalties of 2% of the net smelter return (Woulfe bought that out)
• no income taxes for five years, then 10% for five years, and subsequently 20% of taxable income
• initial capital of US$141 million12 (almost 20% of which is for the APT refinery) plus ongoing capital of approximately US$5 million per year (plus an additional US$22 million in 2016/2017)
• working capital of US$10 million
• average operating costs of approximately US$44 per tonne of mill feed, excluding royalties
•  constant-dollar discount rate of 8%

About market valuation:

• For projects that have completed scoping studies, the adjusted market capitalizations of companies (adjusted for other assets and liabilities other than the property itself) are typically in the range of 15% to 30% of the calculated scoping study after-tax net present values based on long-term projected commodity prices at the time of the study. For those projects with pre-feasibility studies completed, the range is generally from 25% to 40%. For projects with bankable feasibility studies, the range is typically 35% to 65% of the calculated after-tax net present values. It should be noted that most of the other comparable projects are not as advanced as the Sangdong Project, since there is already considerable infrastructure in place at Sangdong, and the project has a history of production (thus reducing technical risk). Due to the foregoing, it is Glanville?s opinion that the Sangdong Project is equivalent to other projects at the Feasibility Study stage, and that one should utilize a percentage of about 50%.