RE: RE: RE: news today "With CAPEX of ~$3.5 billion and a NPV of $10.4 billion, we are a more viable project than both of NML's projects (~$4.5 to $5 billion CAPEX For a NPV of ~$6 billion). We have a larger resource than BKI. We are also "superior" (in most senses of the word) to ADV's project which has a CAPEX requirement of $1 to $1.2 billion and a NPV of $3 billion."
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Capex doesn't scale proportionately. I'd rather invest in a project with $500 million in capex and an NPV of $1 billion, rather than a project with $3 billion in capex and $9 billion NPV.
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Projects with mega-capex get delayed all the time because of credit crunches, commodity price decline, reluctance by banks or the senior partner, etc. Sure everyone can see a project is a good opportunity but putting together the financing isn't easy. Every year tons of iron ore projects are planned but only a fraction of them ever reach production.
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I'd prefer a low-capex DSO project with existing infrastructure (and low volumes of production) over the mega-project with high volumes of potential production.