TXRogers wrote: wwadehammer wrote: Does anyone believe that DL, QH, and ES believe that Radio Hill will be upgraded for anything but gold? Ya, they'll use the crushers for cobalt and nickel because the gold isn't worth as much:
So they can process 1360 tpd at say 15 gpt = 650 ounces per day (you can plug in any gpt you want). Let say cash cost of $400 U.S. per ounce and sell at $1,200 U.S. an ounce for a pre tax profit of $800 an ounce so after tax profit of $500 an ounce. So 650 ounces per day times $500 = $325,000 of profit per day. Cost of $10 million U.S. to get the mill running so payback in 31 days of full mill operation.
Yup if I were DL, I'd forget the gold and go for the cobalt.
Good on all you Aussies who are eating the Canadians lunch
I wouldn't look at it as a Canadian vs Aussie issue. It has to do with two very capable businessmen (who are both quite international in their scope), looking out for their own interests.
Now with regards to the gold issue: Of course this whole Radio Hill refurb announcement is being kicked off by gold production - and gold only - and it must be aimed squarely at NVO. If it weren't the case, then Radio Hill would not have been shut down in the first place and would be processing other base metals today. So I imagine it was never profitable to do so in the absence of gold.
Here is why I think it's directed at NVO. Based on the JV agreement, the profits of the mined gold is to be equally shared between NVO and ARV. And the expenses to develope and mine the gold are to be shared by the two companies as well. And according to the JV agreement, once NVO has completed the $2mil exploration cost earn-in, the JV is officially in place. Based on all the Purdy activity, that would be pretty close to now. So why the timing of the official Radio Hill And OscarWits announcements for today?
One key part of the agreement: It is Karratha Gold (a local %100 owned NVO subsidiary) that is to manage all aspects the JV . As stated:
The joint ventures will be managed as one by Karratha Gold. QH of NVO is on the record stating that Radio Hill is a junk pile and the NVO would not utilize it. However, DL is stating that Radio Hill will be refurbished to put into production to process gold. Since NVO (and Karratha Gold ), made no formal announcment about Radio Hill processing the JV gold, we must assume it's a unilateral decision by DL. Furthermore, within the JV agreement (the details in the May 26, 2017 NR) it states that:
Item 14) The joint venture parties agree to assess the possibility of utilising Artemis’s 425,000 tpa Radio Hill treatment plant for treatment of ore from any new Gold mine pursued by the joint venture, with the view to fast tracking project development; and
So where is the agreement? Answer: There doesn't appear to be one.
This is where it gets very interesting. DL has every right to unilaterally refurbishish the Radio Hill Plant on the condition that it does not process JV gold (for which there should be a NVO agreement). And it looks like that is exactly what DL may be doing with the pursuit of "Mt OscarWits Conglomerate Gold Confirmed Over 14km" - which is ARV gold only.
Once again, I must give DL credit. It must be driving ES and company up the wall.
Tx