RE:Commercial ProductionJust a reminder that commercial production just means that depreciation starts on the asset and revenues/costs start going to the P&L instead of being capitalized. Even if you look back at the last update in Feb., they were at (and in my opinion had exceeded) the 70% of the design capacity in terms of mill throughput and recoveries. They are being a bit conservative in declaring commercial production because of the metalurgical issues the mine has in the past; otherwise, I think they could have declared commercial production if they really wanted to. Meanwhile, concentrate is still being produced and sold.
According to the CC transcript, the steel balls are arriving this month, APRIL. That will certainly help the Zn recoveries increase from 71% closer to the expected recoveries of approx 84%. It won't take 3 more months to see the impact on recoveries from the smaller media. That will be seen in a few days (or weeks). As far as the "new grates" go, it is a design modification, not a complete re-do. While they're not expected till the "second half of the quarter" it will NOT be the determining factor in whether commerical production at Caribou is declared. Modifications are always ongoing at all mines, regarless of whether they are still in development or whether they are producing at capacity. That's just part of the mining industry.
Bottom line:
They don't have to wait to get to 100% mill design throughput and/or 100% of their design recoveries to declare commercial production, as some have implied on this board. Commercial production will be probably be declared this quarter, probably in June effective May 31st. Per the conference call transcript, their stated definition is 70% of these metrics. They were almost there at Feb month-end, and those numbers should have improved since then. Per the Conf call, we'll have an update before mid-April and you will see that they are about there.
Per the conference call transcript, their stated definition is 70% of these metrics. They were almost there at Feb month-end, and those numbers should have improved since then. Per the Conf call, we'll have an update before mid-April and you will see that they are about there.