RE:RE:RE:Thanks Bloomfield Skyline,
I think the political risk in Congo is substantial. There is no safe way for Kabila to step down. Government forces have massacred whole villages. If he steps down now he risks being charged with war crimes. Or alternatively, whoever takes over could simply eliminate him. That's why being a dictator tends to be a lifetime position. How do you tack that onto NPV? Beats me.
If you have a financial background, Skyline, you are in a better position to determine highly accurate free cash flow multiples than I am. My background is geology. One word of caution. These studies are not completely reliable. Feasibility studies are often off by 20% and prefeasibility can be off by 50%. I've seen projects shut down when it became obvious feasibility was way out. Engineers have two competing tasks. One is to provide an accurate report. The other is to gain a repeat customer. They must try to balance the two, and often err in favour of the company. I'm not saying this has occurred in the particular case of IVN, but it does happen in general. We won't get a firm fix on all the financials until actual production is well under way. And that is years away.To be on the safe side I'd increase all costs by 10%. RBC recently put out a $5.50 target on IVN, but said it could fall as low as $2. It's not any easier for the financial pros.
I have no idea where metal prices are going. It's a strange economy we live in these days. It's hard to predict where we'll all be in a few years. I don't trust soaring debt, both public and private, and the stock and housing bubbles. Mostly I stay at cash, unless doing short term trades. If and when the music stops, I don't want to be left holding the bag. My own emphasis is capital preservation over potential profit. That's my preference. It's a very defensive posture. Others see things differently.