RE: RE: CEC feasibility$174: production cost unrel
Quote from CEC Tech Report "The Project base case is financially attractive with an estimated pre-tax NPV (8% discount rate) of C$378million (100% basis) at an average realized coal price of C$174 per tonne (prices are FOB Port Alberni).
The Project returns a non-leveraged, pre-tax discounted cash flow-internal rate of return of 28.7 percent.
Selected financial analysis results are summarized in Table 1-3".
So how financially attractive is the present approx. $115. average price, not to mention it is unlikely given the grade of coal at theRaven site will be 50% metallurgical.
Costs are based on 2010 figures that have increased substantially and do not include significant costs for mitigation (Quinsam just ordered by Environment Canada to develop a "large scale mitigation program" to deal w/ evidence of arsenic and AMD seeps into Long Lake and Quinsam River watershed; security bond to clean up AMD expected to be similar to QM $7,281 million, millions for finance charges especially as Copper Mountain prices appear to be dropping again, compensation to FN for loss of fish revenue in polluted watersources, subsantial transportation increases and production cost increases. CEC has failed to address the high liklihood that AMD will be same as UnionBay coal pile that has been seeping AMD and heavy metals - --and Quinsam Mine seeps that carry $$ to mitigate. Claiming studies are ongoing to determine if Raven soil has AMD potential, therefore, can be interpreted as misleading and a way to avoid for increasing budget costs that are considered substantial economic burdens.