Metal prices realized?Threecpx - Regarding quarterly production #'s, revenues and Ni & Cu metal prices, I believe you are "off" since you are not taking into account the fact that Q4 production (not good) shows up on the Q1 books, Q1 prod (good) on the Q2 books etc.
I believe that the attached two tables from the QI financial report will help explain and clarify this:-
| Item | 1 st Q 2008 | 1 st Q 2007 |
| Ore Delivered to Mill (tonnes) | 39,686 | 21,564 |
| Nickel Mill Head Grade (%) | 1.43 | 1.90 |
| Copper Mill Head Grade (%) | 0.82 | 1.06 |
| Payable Nickel (pounds) | 930,854 | 699,622 |
| Payable Copper (pounds) | 611,537 | 433,409 |
| Payable Cobalt (pounds) | 17,018 | 11,821 |
| Mine operating cost per tonne | $238 | $354 |
| Cash cost per pound of nickel (i) | $10.23 | $10.42 |
| | Q1 2008 | Q1 2007 | Change |
| Sales by Payable Metal | | | |
| Nickel – pounds | 620,944 | 471,659 | 149,285 |
| Copper – pounds | 480,639 | 299,761 | 180,878 |
| Cobalt – pounds | 12,571 | 7,837 | 4,734 |
| Ave. price received – US$/lb | | | |
| Nickel | $12.24 | $16.67 | $(4.43) |
| Copper | $3.07 | $2.70 | $0.37 |
| Cobalt | $45.90 | $25.77 | $20.13 |
| Ave. Exch. Rate Realized | | | |
| US $ 1 = Canadian $ | $1.0031 | $1.1704 | $(0.1673) |
From Kitco historical metal price charts for copper & nickel below, $12.24 would appear to be the average nickel price/lb for the three month period Oct/Nov/Dec 2007, and similarly $3.07 for copper.
From examination of these charts it would appear that Ni price//lb in Jan/Feb/Mar 2008 applied to revenue from Q1 production (seen in Q2 financials) will be more or less the same as the previous quarter (perhaps a little higher @ $12.75/lb), but the Cu price/lb should be significantly better at around $3.75/lb (these are just guesstimates from quick examination of the charts).
Remember too that the Cobalt revenue, @ $45/lb (around $0.5 million) is not chump change.
With current margins so slim, in my opinion what is also hurting the financials is the significant nickel bonus (a fact of life for Sudbury mining operations) as almost $4 million was paid out in 2007. Remember that no nickel bonus is paid when a quarterly loss appears on the books (as in Q1).
Note: "Cash cost per pound of nickel is a non GAAP measure and is net of other metal credits, and does not include amortization of mining properties and equipment, but does include the nickel bonus defined in the Company's collective agreements which is tied to the price of nickel."
Regarding the Premiere Ridge feasibility report, this is of course a technical report, so as you state there probably will be a lot of "fluff" from a lay-persons perspective.
Compared to current metal prices, the price/lb quoted in the report for Ni, Cu and Co (see below) are "mine life" figures, and if you look further back historically at the Kitco metal charts, you will see that these #'s are perhaps more reasonable.
Ni - $8.61/lb
Cu - $2.22/lb
Co - $9.11/lb
Keep up the good research, and DD of course, but I don't think you will see your $0.30 target entry price!
Victor