DCF-update (part 1 of 3)Updated: April 2, 2007. Designed and evaluated by: delta. Sources: Info from company, competitors, market statistics, Pareto, other publications
NORTHLAND RESOURCES INC. (NAUR)
Basic assumption: a strong commodity cycle over at least the next decade driven by strong demand from developing economies (BRIC)
Obs! High risk - may be to optimistic - time will tell. But high potential if successful
Links to 2 updated DCF-sheets:
https://farm1.static.flickr.com/170/443545403_b6dd30ba31_o.jpg
https://farm1.static.flickr.com/170/443545427_3ed4580db1_o.jpg
Notes:
DCF:
DCF: Discounted cash flow according to formulas in the spread sheet and calculated on basis of the model input.
Calculating going concern value as per Dec 2006 in a "base case" scenario.
Other potential value projects than Barsele, Stora Sahavaara and Hannukainen are not included in the above calculated DCF. Other future NAUR-exploration projects are expected to materialize in adding to shareholders value. NAUR have 18 other IOCG-targets for exploration with historic resource indication of accumulated more than 100 mill. tons of IOCG. I.e. DCF YE06= NOK 5/share for a new 100 mill. ton resource base producing pellets only from 2015, NOK14/share if the same resource base is expanded to 200 mill. tons.
Content of formula for DCF of Hannukainen:
C68
1-C32/100)*(NÅVERDI(C66/100;C16;-C63)/(1+C66/100)^(C17-2006-1*1)-(C18/(1+C66/100)^(C20-2006)))-(C21/(1+C66/100)^(C17-1-2006)-C21/(1+C66/100)^(C16+C17-2006-1))*1
Resource base assumptions in DCF-calculation:
Stora Sahavaara (IOCG): 145 mill. tons according to NI 43-101 Resource Calculation + additional target during the coming years 55 mill. tons = 200 mill. tons.
Hannukainen (IOCG): 66 mill. tons according to Finnish Geological Survey (GTK) + expected additional indication 34 mill. tons = 100 mill. tons expected declared according to NI 43-101 during Q2/2007 + additional target during the coming years 100 mill. tons = 200 mill. tons.
Barsele (Gold): 0,83 mill. oz according to NI 43-101 Resource Calculation + additional indication 0,17 mill. oz = 1 mill. oz expected declared according to NI 43-101 during 2007
Yield of finished products (pellets, copper, gold) from resource base according to earlier experience and analysis of samples from drilling.
Iron ore pellets production over mine life (mill. tons) - content of formula for HK: C49=C10*C11/100.
Gold production over mine life (mill. oz) - content of formula for HK: C51=C10*C12/31,103*C13/100.
Copper production over mine life (1000 tons) - content of formula for HK: C53 =1000*C10*C14/100*C15/100.
For copper: converting from kg to lbs: multiply by 2,205.
Concentrate grade copper and gold for HK: Assuming yield as a weighted average grade of results from 42 holes published so far for the Laurinoja-body and multiplied by 2 (ref. "Mag' Sep' should yield con with +/- double this grade" according to p. 33 in NAUR-presentation of March 2007) and deducted by 30 % as a projection to a resource base estimate expected upgraded to 200 mill. tons for all 5 bodies in Hannukainen during the next years.