RE:brd versus sas
Josa:
As we look at the most recent company presentations.. All in costs are $1100 for BRD and $1210 for SAS. Recall the SSL stream at BF is now a 8% of LOM production for $503/oz. With GF and the potential for some sort BRD/SAS of co-production a 0% stream will result in all (say) $1325/oz going to the Option C JV (where Option A is BRD-GF alone, Option B is SAS-Hislop alone). The potential savings could come from an amalgamation of pits and/or properties.
Lurk and Learns .... Still confused? Well draw a vertical block of 400m (assume the "party wall" to be 20m) to scale. Then add a pit slope to the north side (Option A) and a pit slope to the south side.(Option B). You should should see a trapezoid (?) shaped as the "sanitized" (aka stranded) block of ore between the two properties in a non-JV. In an Option C scenario, this block could obviate this loss of ore, by eliminating (and hence sharing the non-streamed/spot potential cash flow potential from) this "sanitized" wedge all together. Recall, Hislop metallurgy would suggest that GF ore would require similiar back-end (wet mill) processing.
Thus, to reduce the all-in costs to both entities (even if the decide that the best option is operating independently) the BRD GF ore could be treated as custom milled to the SAS HM mill. In addition, the use/sharing of the SAS Hislop surface infrastructure, equipment for stripping of the OP may help to advance the project (regardless of Option selected) until the BRD spread is available post BF OP Phase III.
The decision to expedite the expansion of the BF UG reserve speaks volumes in this very uncertain environment for the POG.
Thus, once Phase III of the BF OP is exhausted, a high grade UG operation to the 400m level could support an orderly transition to an Option A or Option C.
BWDIK? A good technical report of actuals (vis a vis p 21 table of the latest presentation) should footnote the 19 days lost in the Q2 numbers.
Cheers
Stanley